Public Benefits of the Lottery


The drawing of lots to determine property or other rights has a long record in human history, including several instances recorded in the Bible. Lotteries have also been used by governments to raise money for towns, wars, and public-works projects.

When a lottery prize reaches an enormous size, it generates a great deal of interest and news coverage. But the truth is that most of the prize’s value comes from a small group of “super users,” who buy large numbers of tickets, often more than a hundred per week, and win big prizes on a regular basis. The rest of the money, or most of it, is spread out to the other ticket holders who have purchased fewer tickets and won smaller amounts.

Many states use the lottery to finance a variety of public programs and services, from paving streets and building wharves to supporting universities and hospitals. In colonial era America, lottery revenue was used to fund the first permanent English settlement in Jamestown, Virginia, and to help finance the construction of Harvard and Yale. George Washington sponsored a lottery in 1768 to build a road across the Blue Ridge Mountains.

State governments have been using lotteries for over two centuries to fund a wide range of public needs and programs, from roads and schools to prisons and hospitals. The popularity of lotteries is widely perceived as a way to reduce taxes and avoid raising other forms of taxation, while providing an opportunity for people to gain wealth through a simple act of chance.

But despite this common perception, the popularity of lotteries has nothing to do with a state’s actual fiscal health. Rather, it is the perception that lottery proceeds benefit some specific public good – education in most cases – which wins and sustains broad public approval for the games.

The argument that lotteries are a form of painless taxation has proved remarkably persuasive in winning popular support, and this is especially true in times of financial stress when people fear higher taxes or cuts in public programs. Indeed, studies have shown that lotteries are even more popular in such periods than when they are not.

Nevertheless, the promotion of gambling does have some significant negative consequences for poorer citizens and problem gamblers, and it is not clear whether the lottery’s primary function – generating tax revenues – serves the greater public good. Moreover, since state lotteries are essentially run as businesses with the goal of increasing revenue, their advertising necessarily focuses on persuading target groups to spend their money on tickets. This raises serious concerns about whether promoting gambling is a proper role for government.