The History of the Lottery


The lottery is a multibillion-dollar business, with millions of Americans playing it every week. Despite the odds, there is always that tiny sliver of hope that you will be the lucky one to hit it big. Many people play with friends in a syndicate, where each puts in a little bit of money and shares the winnings. Others do it as a form of recreation, spending some of their disposable income to escape from daily life for awhile.

In his book, Cohen explains how the lottery emerged as a popular alternative to traditional taxes when America’s late-twentieth-century tax revolt converged with a crisis in state budgets. In addition to attracting voters, the lottery provides a valuable source of “painless” revenue that does not require state governments to raise taxes or cut programs. This fact, in combination with the public’s general aversion to paying taxes, made lottery proponents’ arguments particularly persuasive.

When state lotteries first appeared in the United States, they were a hybrid of traditional raffles and gambling. Traditionally, a state enacted legislation to create a monopoly, set up a state agency or public corporation to run the lottery, and launched with a modest number of relatively simple games. Over time, the lottery would expand to keep up with demand and the need for new revenues. In a typical case, revenues would skyrocket initially, then level off or even decline. In order to keep the revenue ball rolling, lotteries would introduce a series of new games and increase ticket prices, often dramatically.

Lottery advocates argue that the proceeds are earmarked for a public good such as education, and this argument is especially effective in times of fiscal stress. However, the lottery’s popularity is not linked to the state government’s actual financial health: it has won broad support even when states are in excellent fiscal condition.

Moreover, the distribution of lottery players and profits is very uneven. Studies show that the majority of participants come from middle-income neighborhoods and that low-income residents participate proportionally less than their share of the population. In the rare event that someone does win the lottery, it is usually for a sum so large that half of it will be paid in taxes. These heavy tax burdens are a major reason why the vast majority of lottery winners go broke within a few years of their windfall.

Nonetheless, the lottery persists as a favored method of raising state revenues and, in some cases, to promote social reform. Although it is easy to dismiss as irrational, there is something deeply human about the lottery: the desire for a fair and just chance at an otherwise unobtainable goal. In the end, though, it is not so much the chances of winning that matter as what they mean to people’s lives and sense of self-worth. For some, a win is the only way out of poverty or mental illness, and for others it is simply their last, best, or only chance at happiness.