What is an Official Lottery?

A competition based on chance, in which numbered tickets are sold and prizes, typically money or goods, are awarded to ticket holders at random. Lotteries are common in many states. They can be run by private companies, such as betting firms, or by state agencies. Some have specific rules (e.g., limiting prize amounts to a certain percentage of total sales) and may require a substantial portion of the proceeds to go to charity. Originally, they were banned in most countries, but in the nineteenth century they became popular. The first modern government-run lottery was established in Puerto Rico in 1934 and was followed by New Hampshire in 1964.

Cohen suggests that the real reason state governments have enacted lotteries is their need for “painless revenue.” In the decades following World War II, as states enlarged their social safety nets, the federal government no longer provided enough funds to balance state budgets. This was compounded by rising inflation and the cost of the Vietnam War, and voters were increasingly reluctant to either increase taxes or cut services.

Lotteries supposedly offer “painless revenue.” But the truth is that they are not just generating revenues, but also creating new generations of gamblers. They dangle the possibility of winning millions in an age where economic mobility is limited and most people have only a few years to get ahead in life. Moreover, they play to a basic human impulse that likes to play games of chance.