Lottery and State Governments

Lottery is a game in which people pay for a chance to win a prize, the value of which depends on an element of chance. In the United States, state governments conduct lotteries. In some countries, private companies run lotteries. The lottery can be played online, through the mail or over the telephone. Federal law prohibits mailing and other forms of interstate commerce promotion of lotteries, but does not ban the sale or purchase of tickets itself.

The popularity of lotteries is often linked to state governments’ need for revenue. Lottery revenues expand quickly and dramatically after introduction, but then tend to level off or even decline. To sustain revenues, lotteries introduce new games frequently.

These new games have various names, such as instant or scratch-off tickets. The prizes for winning these games are smaller than those in the main drawing, but the odds of winning are much greater, on the order of one in several million. Using these new games, state lotteries seek to make their offerings more attractive to the public.

One important message pushed by lotteries is that they are a source of “painless” revenue. This argument argues that lotteries enable the state to raise money without raising taxes or cutting programs for its poorest residents. It is an argument that appeals most strongly in times of economic stress. But studies have shown that the actual fiscal circumstances of the state do not seem to be related to whether or when a state adopts a lottery.

A key problem with this argument is that it assumes that the benefits of a lottery are so large that they will outweigh any harms. In reality, lotteries have been found to cause a variety of social problems, including increased gambling addiction, diminished family and community life, and reduced educational achievement.

Many states have reacted to these problems by expanding the types of programs they support through lottery proceeds. But these programs have been criticized for their insufficient focus on preventing gambling addiction and for their tendency to treat gambling as a minor vice rather than as a serious problem.

The main argument that state governments use to promote lotteries is that they serve a “public interest.” This argument holds that, in addition to being an efficient and economical source of funds, lotteries also provide a valuable service by helping to reduce gambling addiction. Some of this benefit is indirect and relates to the effects that gambling has on society in general, but a substantial portion of it is direct and relates to the ways in which state governments promote and operate lotteries. As a result, the argument is flawed on both substantive and moral grounds. This article provides a detailed analysis of this argument and discusses why it should be rejected. It also offers suggestions for improving the effectiveness of state policies to reduce gambling addiction and other harms caused by lotteries. It is based on an essay originally published in the journal, Law and Contemporary Problems.