Lottery is a gambling game in which players try to match numbers or symbols on tickets for a prize. Normally, the winner of the lottery gets the sum total of all the tickets sold. Usually, there are many smaller prizes, as well. The game is also sometimes referred to as a raffle, although this has different meanings. A raffle usually offers physical prizes, such as food, wine and hampers, while a lottery will only give out cash.
Whether or not the word “lottery” is used, the game has long been controversial. It can be addictive and can cause financial ruin for some people. Some states have banned the practice, while others endorse it and regulate it. Lottery is a risky business, but it can be profitable and fun. Some people have won huge jackpots, but others have lost everything.
The modern lottery began in the nineteen-sixties, when growing awareness of all the money to be made in gambling collided with a crisis in state funding. In the wake of soaring population and inflation, the cost of the Vietnam War, and an economic downturn, it became clear that many states would have to raise taxes or cut services. Both options were unpopular with voters. In the wake of this fiscal disaster, many politicians started pushing for a national lottery.
In the late sixteenth century, it was common in the Low Countries for towns to organize lotteries to collect money for town fortifications and other public uses. The Dutch state-owned Staatsloterij still operates today and is the oldest running lottery in the world.
Cohen’s book traces the history of this development. Initially, lotteries were sold as a form of taxation that was easy for citizens to support. As the gambling industry grew, however, people became aware of the fact that winning was largely a matter of chance. Despite the obvious risks, some people continued to play lotteries, and they soon demanded that the government regulate and promote it.
A key element in any lottery is a mechanism for collecting and pooling all the stakes placed. Traditionally, this has involved a hierarchy of sales agents who pass the money paid for tickets up through the organization until it is “banked.” Generally, all but a small percentage must go to costs of organizing and promoting the lottery, leaving the remainder available for prizes.
Rich people do play the lottery, of course; one recent Powerball jackpot reached a quarter of a billion dollars. But they buy fewer tickets than the poor do, and they spend far less of their income on them. According to the consumer financial company Bankrate, those making more than fifty thousand dollars a year spend on average one per cent of their incomes on tickets; those who make less spend thirteen per cent.