What is a Lottery?

The word lottery may conjure up images of a game with an enormous prize, but in fact it describes a procedure or system for selecting winners in any kind of contest. The process is often based on chance, and the choice of winners may be determined by random selection or by some other mechanism such as drawing lots. Whether you are talking about the lottery that dishes out cash prizes or those that determine kindergarten admission, the allocation of units in a subsidized housing block, or the granting of vaccine patents, lotteries are common and widely used.

The origin of the word is obscure, but the term probably stems from Old Dutch loteria, derived from Middle Dutch loterie, perhaps a calque on Latin lottere “to draw” (OED). In any case, it was popular in Roman times—Nero loved them—and it has also been employed for everything from divining God’s will to choosing slaves and soldiers. Moreover, the term has a long history outside of formal state-sponsored lotteries: It is attested in medieval Europe and, for example, was once used to select judges for a court case.

While the majority of people who play the lottery do so out of fun, a smaller percentage use it as a way to improve their lives. These folks contribute billions of dollars to government receipts that they could otherwise have saved for things like retirement and college tuition, and they hope to do so with a minimal risk-to-reward ratio. But it’s important to remember that the odds of winning are incredibly low, so even a small purchase can cost a person thousands in foregone savings.

But despite the regressivity, there’s still something to be said for the appeal of lotteries, especially when it comes to those who do not have much disposable income in the first place. Those in the 21st through 60th percentile of the income distribution typically spend a significant share of their income on tickets, thereby foregoing opportunities to pursue the American dream and to grow their wealth through hard work and innovation.

The bottom quintile, by contrast, does not spend much on tickets, and their chances of winning the lottery are accordingly quite slim. That’s not to say the poor do not enjoy gambling—they certainly do—but it’s a gamble that’s not in their interest.

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