Is the Lottery Good For Public Purposes?

A lottery is a game in which numbers are drawn at random and people who have the right combination of numbers on their tickets win prizes. Lotteries have a long history, and they’ve been used to award everything from slaves to land to public works. They are popular in some countries and not others, but they’re often regulated in some way. The modern lottery has its roots in the late nineteenth century, when a growing awareness of all the money to be made in the gambling industry collided with a crisis in state funding. As Cohen recounts, in the nineteen-twenties, when inflation and population growth started to drain state coffers, many states found themselves unable to balance their budgets without raising taxes or cutting services. This is when the lottery first appeared as a solution.

The casting of lots to determine fates and property has a long history, with instances in the Bible and in ancient Roman emperors’ use of them for party entertainment—a favorite during Saturnalia celebrations was apophoreta, in which guests were given pieces of wood with symbols carved into them and, toward the end of the evening, the winners were chosen by lottery. Lotteries were also common at public events in the early colonies of England and America, where gambling was allowed despite strict Protestant proscriptions against it.

In its modern incarnation, lottery is a state-sponsored and regulated form of gambling in which participants pay a small sum to receive the chance to win a large prize. The prizes are largely cash, but they can be goods or services as well. Many of the same arguments that apply to other forms of gambling can be applied to lottery gambling: it is addictive and can damage financial health; people who are poor are more likely to buy tickets than those who are rich; the odds of winning are slim; and, most importantly, a winner’s victory doesn’t change their overall financial picture.

Despite these warnings, there are still some who believe that the lottery is an effective means of raising funds for public purposes. This is especially true in places where taxes are high and where voters are averse to raising them. The lottery, they argue, can make government coffers appear full of money when they would otherwise be empty. And although they acknowledge that lottery proceeds are not as consistent as those from sales and income taxes, they argue that the draw of the big jackpot entices people to play. They are correct that the large jackpots do attract people, but they should be careful not to underestimate the impact of other factors. For example, the wealthy spend on average only one percent of their annual income on lottery tickets, while those earning less than fifty thousand dollars buy thirteen per cent. This difference can have real economic consequences. It can, for instance, make it harder for the poor to buy a home, or for their children to attend college.

Categories: Gambling