As state governments grapple with fiscal crises, the lottery has regained popularity as a source of revenue. Its advocates argue that it is a less onerous tax than other options, such as raising sales taxes or cutting public programs. It’s an appealing argument, but a closer look at the lottery shows that the truth is much more complicated.
Regardless of how the proceeds are used, a primary reason why lotteries gain widespread approval is because they offer people a chance to win something desirable that they would otherwise be unlikely to get through conventional channels. These prizes might include kindergarten admissions at a prestigious school, units in a subsidized housing block, or even a vaccine for a deadly virus.
The first known lotteries were probably held in the Low Countries in the 15th century. Records from towns such as Ghent, Bruges, and Utrecht show that tickets were sold to raise money for town fortifications and the poor. The modern state lottery has similar roots, beginning in the United States after World War II. Its early advocates saw it as a way to pay for a wide array of government services without the need to impose especially onerous taxes on middle-class and working-class taxpayers.
When it comes to lottery marketing, the most blatant gambit is the jackpot. The larger the prize, the more people are willing to buy tickets and the greater the chance of hitting it. But it’s not just the jackpots that are important; there is a deep psychological and social underbelly to lottery advertising, as well. People play the lottery not just because they want to win, but also because they believe that the long shot is their only hope for getting ahead in life.
Lottery advertisements make a huge amount of money by stoking the fantasies and hopes of Americans who are desperately searching for ways to improve their lives. The average American spends more than $80 per year on lotteries, and the vast majority of these ticket buyers will never win anything. Many of those who do win will end up bankrupt in a few years. Instead of buying a lottery ticket, people should consider saving that money for an emergency fund or paying down their credit card debt.
State lotteries are run as businesses with a primary objective of maximizing revenues. As such, they must continually introduce new games to maintain and even increase their revenues. Consequently, their advertising necessarily targets specific groups of people—in particular, the young and the old. These promotions have been criticized for having negative consequences for compulsive gamblers and for their regressive impact on lower-income communities. Yet, the fact remains that state lotteries are a popular way to finance government services. The question is whether this is the right approach for contemporary society.