Public Good and Lottery

A lottery is a form of gambling in which you pay a small sum of money for a chance to win a larger prize, usually cash or goods. Many types of lotteries exist, including state and national lotteries, charitable and civic lotteries, and commercial promotions such as sweepstakes. The lottery’s basic system involves a random drawing to determine winners. It has been criticized as an addictive form of gambling but can also be used for public good, such as funding construction projects and schools.

The roots of lotteries date back centuries. The Old Testament instructs Moses to divide land among Israelites by lot, and Roman emperors gave away property and slaves via the same procedure. In the early United States, lotteries raised funds for colonial-era infrastructure, including paving streets and building wharves. Benjamin Franklin sponsored a lottery to fund cannons for defense against the British, and Thomas Jefferson held one to try to alleviate his crushing debt.

Lottery revenues typically expand dramatically after the introduction of a new game, then level off or even decline. To maintain or increase revenues, lotteries introduce a variety of innovations, from scratch-off tickets to keno and video poker.

Because lotteries are run as businesses with a goal of maximizing revenue, advertising necessarily focuses on persuading target groups to spend their money. This raises the question whether promoting gambling is an appropriate function for a government, especially since it can have negative consequences for the poor and problem gamblers.