The Problems of the Lottery


A scheme for the distribution of prizes, often money or goods, by lot. Also used figuratively to refer to any situation that relies on chance rather than careful organization (such as a marriage).

The lottery has always had an enticing aura of legitimacy, with its promise of instant riches and the allure of “free stuff.” It’s no surprise that states have spent billions on lotteries over the years. But in fact, there’s a lot more going on than the mere dangling of free cash—lotteries promote irrational gambling behaviors and contribute to inequality by dangling the promise of a better life that most people can’t possibly afford.

As state governments have adopted lotteries, they’ve done so in a predictable pattern. They legislate a monopoly for themselves; they establish a public agency or corporation to run the lottery (as opposed to licensing a private firm in return for a share of profits); and they begin operations with a modest number of relatively simple games. Over time, however, the growth in revenues has forced lotteries to progressively expand their size and complexity. They also introduce new types of games, such as keno and video poker, and increase the intensity of promotional efforts, especially through advertising.

Moreover, because of the way that most state lotteries operate, they’re heavily dependent on the continuing influx of revenue. As a result, they tend to make decisions that favor short-term gains over longer-term benefits. Consequently, they can be more inclined to cut expenses when the economy slows than they would otherwise be, and they are often reluctant to raise taxes when the economy is strong.

A second issue is that, as state government budgets have eroded over the past several decades, lottery revenues have increased significantly. This has prompted state officials to pursue more ambitious games, and it has also heightened concern that these newer games are far more addictive than traditional lotteries. In addition, they may exacerbate the existing problems associated with gambling, such as by targeting poorer individuals, by making it harder to distinguish between legitimate and problem gamblers, or by providing an environment that encourages addictive behavior.

Finally, state lotteries are a classic example of how public policy is made piecemeal and incrementally, with little or no overall overview. In the case of the lottery, that means that policy decisions are constantly being overruled by the industry’s own evolution and a desire to boost revenues in a rapidly growing sector of state government. As a consequence, few states have a comprehensive “lottery policy.” Instead, each year’s lottery officials must make hundreds of decisions about how to best grow the business. They must decide what kinds of games to offer; how many tickets to sell; when and where to market them; what kind of games to add; etc. Each of these decisions has significant long-term ramifications. To help mitigate some of these concerns, some states have joined multi-state lotteries to increase the size of jackpots and to attract players.

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