What is the Lottery?

The lottery is a form of gambling in which tickets are sold for a chance to win a prize, usually money. Lotteries are often organized so that a percentage of the profits are donated to good causes. They can be found in many forms, such as those for subsidized housing units or kindergarten placements. The word lottery is derived from the French word loterie, meaning “drawing of lots.” The first recorded lotteries were held in the Low Countries in the 15th century for the purpose of raising funds to build town fortifications and help the poor.

In colonial America, private lotteries were popular and helped to finance public works projects as well as the founding of Harvard and Yale. Benjamin Franklin sponsored a lottery in 1776 to raise funds for cannons to defend Philadelphia, but his lottery was unsuccessful. George Washington promoted a lottery to build roads across the Blue Ridge Mountains, but it was also unsuccessful.

Despite the fact that lottery mathematics shows that a ticket purchase cannot be rational according to expected value maximization, state governments continue to promote lotteries as a source of “painless revenue.” Most states establish a monopoly for their own lottery by legislative decree; hire a private company to run the lottery in exchange for a share of the profits; start with a modest number of games and gradually expand to meet consumer demand. In almost every case, the growth in lottery revenues has been driven by increased marketing.