The History of the Lottery


Lottery is a game of chance in which players purchase tickets for a prize. The prizes can be money or goods. In most countries, the money is used to fund public services. While lotteries may have some social costs, such as attracting problem gamblers and increasing poverty, they are often popular with the general population. In the US, the lottery is an industry worth over $80 billion a year.

The first state-sponsored lotteries took place in the Low Countries in the early 15th century. The word “lottery” probably derives from the Middle Dutch noun lot, meaning fate or destiny; it also could be a calque on Middle French loterie, “action of drawing lots.”

A state-run lottery begins with the legislature passing a law creating a monopoly for itself (as opposed to licensing private firms in return for a percentage of profits); establishes an agency or public corporation to run it; and starts out with a modest number of relatively simple games. Under pressure to generate revenue, it then progressively expands the size and complexity of the games.

Generally speaking, the earliest states’ arguments for adopting state-sponsored lotteries revolved around their value as sources of “painless” revenue. They were seen as a way to raise money without increasing taxes on working people or cutting public programs.

But, because lotteries are businesses with a focus on maximizing revenues, their advertising necessarily focuses on persuading targeted groups to spend their money on them. In fact, studies suggest that the bulk of lottery players and revenues come from middle-income neighborhoods, and far fewer proportionally from lower-income areas.