The lottery is a state-sanctioned gambling game in which tickets are sold for the chance to win large prizes. Lottery proceeds are used to fund a variety of public services. Lotteries enjoy broad public support and generate relatively stable revenue streams for states and localities, making them a popular alternative to imposing higher taxes.
The casting of lots to determine fates has a long history, and the modern lottery is a logical extension of this ancient practice. Until recently, most state lotteries operated as traditional raffles, with the public buying tickets for a drawing that would take place weeks or months in the future. In the 1970s, however, a series of innovations dramatically changed the lottery landscape.
First, the advent of instant games, such as scratch-off tickets and the Quick Pick numbers option, enabled the lottery to capture a larger share of the market. Second, and more importantly, the introduction of multi-state games created a new competitive environment that encouraged the creation of innovative products and marketing strategies to increase sales.
Lottery revenues have risen rapidly since the early post-World War II period, and have proven to be a reliable source of revenue for many state governments. But, as Clotfelter and Cook point out, lottery popularity has little connection to a state government’s objective fiscal circumstances; public approval is usually low even when the budget outlook is positive.
