What is a Lottery?

A lottery is an arrangement by which prizes are allocated by a process that relies entirely on chance. It is a common fund-raising device in many countries. Prizes may be money, goods or services. Often, the total value of the prizes will be the sum of all the tickets sold and will include profits for the promoter and taxes or other revenues. The earliest known lotteries were conducted in the 15th century in the Low Countries to raise funds for town fortifications and to help the poor.

In modern times, state lotteries typically involve a legislative act creating a monopoly for the government to conduct the lottery (although some states have chosen to license private promoters in return for a share of the proceeds) and setting up a central agency or corporation to run the lottery. The agency begins operations with a modest number of relatively simple games, and then, under pressure to generate revenue, the lottery tries to boost sales by adding new games and increasing the prizes on offer.

Lottery advocates began focusing less on the benefits of gambling and more on arguing that lottery proceeds would support a line item in a state’s budget that was popular and nonpartisan—most commonly education but also elder care, parks, and aid for veterans. But critics point out that earmarking lottery revenues simply reduces the amount of general funds the legislature must allot to the line item, and that the lottery is operating at cross-purposes with the public interest.