The practice of making decisions and determining fates by casting lots has a long history (the Old Testament instructs Moses to use lotteries for the distribution of land, Roman emperors used lotteries to give away slaves), but it became increasingly popular as governments began to collect more money for purposes like infrastructure and social programs. Lotteries exploded in popularity during the post-World War II period, with many states seeing them as a way to fund services without heavy taxes on working and middle class people.
State government officials know that there is an inextricable human impulse to gamble, and they also know that promoting gambling can lead to negative consequences for the poor and compulsive gamblers. So they have a choice to make: Should state government be in the business of encouraging vice? And if so, should that promotion be focused on lottery games?
Since the early days of lottery, there have been many different ways to play. One of the most popular is called a scratch-off ticket, and it’s very simple: you buy a ticket and then scratch off a small portion of the ticket to reveal a number. If you match a winning combination, you win the prize shown on the ticket’s front. These tickets are generally cheap ($1 or less) and have small payouts.
Another option is a pull-tab ticket, which works the same way as a scratch-off except that you break open the perforated tab on the back of the ticket to see if the numbers on the back match those on the front. These tickets are more expensive and usually have higher payouts, but they can also be addictive, a fact that is borne out by studies of their popularity among lower-income groups.
In both cases, a key element in lottery success is the ability to convince the public that proceeds are going toward a specific good, such as education. This message is especially powerful when a state’s fiscal condition is precarious, but it has also been successful during times of relative stability. In addition, state lotteries rely on a steady flow of new games and advertising to keep revenues growing.
But there are two fundamental issues with this approach. First, it gives state officials a false sense of security about the lottery’s financial health. In an anti-tax era, where most state governments have become dependent on “painless” lottery profits to fill the gaps in their budgets, there is a strong incentive to continually expand the lottery. And as lottery revenues have continued to increase, critics have shifted their focus from the desirability of lottery expansion to its potential problems: regressive effects on low-income groups, encouragement of compulsive gambling, etc.