Public Support for the Lottery

The lottery is a game wherein participants have an opportunity to win prizes, typically in the form of money or goods. While casting lots to decide fate has a long history (there are records of lotteries dating back to ancient Rome), the modern state lottery originated in the United States during the early colonial period, as a way to raise funds for public projects without increasing taxes. The success of these state lotteries has inspired many other countries to adopt their own versions, and today lottery operations exist in 37 states and the District of Columbia.

The majority of tickets are sold by convenience stores, with the remainder sold by grocery stores, gas stations, nonprofit organizations (such as churches and fraternal groups), service stations, bowling alleys, restaurants and bars, and newsstands. About half of all retailers sell tickets online as well. The National Association of State Lottery Directors reports that approximately 186,000 outlets sold tickets in 2003.

Lottery games have broad public support, with a substantial portion of adults in states that operate them reporting playing at least once a year. Some of these people report playing frequently — about once or twice per week — while others play only occasionally, such as once every few months or less. Regardless of how often they play, most people believe that winning the lottery is an acceptable way to spend their spare time.

A significant proportion of the proceeds from lottery sales are used to pay for education, which has contributed to the widespread acceptance of lotteries as an effective public funding mechanism. But studies have shown that a state’s fiscal health does not appear to influence its level of lottery participation, and that the popularity of a lottery may be driven by other factors.

In addition to promoting educational opportunities, the proceeds of some state lotteries are dedicated to other public purposes, such as law enforcement and social services. This is important, as it reduces the perception that the lottery is a “hidden tax” that disproportionately burdens lower-income households.

The public messages promoted by lottery commissions aim to convey two key points. First, they promote the notion that lottery playing is fun and a “game” that should be taken lightly by people who buy tickets, in contrast to other gambling activities such as slot machines, which should be treated as a serious financial risk. Second, they encourage people to believe that winning a prize in a lottery is the result of chance, which is true and which has influenced the widespread belief that the odds of winning are quite low. These messages obscure the regressive nature of the lottery and have contributed to its continued success despite declining interest in other forms of gambling. NerdWallet writer Adam Chartier is an economist who specializes in the economics of consumer behavior. He is also an experienced entrepreneur and business owner. You can follow him on Twitter at @NerdWallet.