A lottery is a process in which prizes, usually money or goods, are assigned by drawing lots. The word is probably derived from Middle Dutch loterie, meaning “action of drawing lots”, but it may also be from an unrelated root meaning “to arrange” or “to set.” Modern examples include a draw to award the right to purchase units in a subsidized housing development and the placement of children into a public school. The premise of these arrangements is that the entertainment value and other non-monetary benefits obtained by participating will outweigh any monetary loss. For many people this is enough to make buying tickets a rational decision, even though the odds of winning are extremely low.
The short story that prompted this article, “The Lottery,” by Shirley Jackson, describes a small English village preparing for an annual lottery. As in most such stories the lottery is a metaphor for something else, and in this case it stands for evil. Jackson’s portrayal of the town’s gleeful preparations for the lottery suggests that humans are capable of all sorts of unethical and immoral behavior.
In the United States, state-sponsored lotteries contribute billions to government coffers each year. Some people play them for fun, while others believe that winning the lottery is their ticket to a better life. The truth is that there are many different ways to improve your life without relying on the lottery.
To keep ticket sales robust, state lotteries must pay out a significant percentage of sales in prize money. This reduces the amount of money that can be redirected to things like education, which is the ostensible reason for their existence. This arrangement is not as transparent as a regular tax and consumers often aren’t aware that they are paying an implicit tax on each ticket.
As the popularity of lotteries declined in the early 21st century, supporters began to ginned up other strategies for selling them. They stopped arguing that lottery revenue would float the entire state budget and started claiming that it could finance one line item—often education but sometimes elder care or public parks. This narrower claim made it much easier to sell the idea.
Rich people do buy lottery tickets, of course, but they buy fewer tickets and, on average, spend about a tenth as much of their income as the poor do. In the case of the Powerball lottery, winners who make more than fifty thousand dollars a year spend about one percent of their income on tickets; those who earn less than thirty thousand dollars spend thirteen percent. That gap can be a lot wider when jackpots approach ten figures.