What is a Lottery?


Lottery is a competition based on chance, in which numbered tickets are sold and prizes are awarded to the holders of winning numbers. It has become a major source of income for many states and charities.

The practice of making decisions and determining fates by the casting of lots has a long history, including several instances in the Bible. However, the practice of drawing and awarding prizes in order to raise money for public purposes is of more recent origin. The first recorded public lottery in the West was held for municipal repairs in 1466, and a state-owned Staatsloterij began operation in 1726. Before their outlawing in the late 1800s, state lotteries were responsible for a wide range of public usages, including funding of such projects as the building of the British Museum and the repair of bridges.

The principal argument used by state governments to promote the adoption of a lottery is that it provides a painless source of revenue, in which players voluntarily spend their money (as opposed to being taxed) for the benefit of a specific public good such as education. This argument is especially effective during times of economic stress, when the prospect of tax increases or cuts in other state spending may be frightening to the general public. But studies indicate that the popularity of a lottery does not necessarily correlate with the fiscal health of the state. In fact, the popularity of a lottery seems to depend more on its own particular features and how it is managed.