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How the Lottery Works

Lottery generates huge amounts of revenue in the United States, but the odds are long that anyone will win. Yet, many people play it regularly. In fact, Americans spend $80 billion annually on lottery tickets. Some do so to get a leg up on emergency funds or credit card debt, but others believe that the lottery is their only chance at a better life.

It’s hard to find a state that doesn’t have a lottery, but they all vary in how they operate. But most follow a predictable pattern: the state legislates a monopoly for itself or for a private company; starts out with a modest number of relatively simple games, then grows rapidly by adding new games to maintain revenue; and finally, after a few years, begins to level off and decline.

To boost ticket sales, the games must offer big prizes to draw attention. But those big prizes aren’t necessarily a good thing. They make the games more like a game of chance, obscuring how much money is being spent and how regressive the lottery is. Super-sized jackpots also encourage the gambler to buy more tickets, which can actually reduce his or her chances of winning by reducing the total prize pool.

The other message that state lotteries rely on is the specific benefit they bring to states—often by earmarking the proceeds for education or public works projects. This is a good thing, but it obscures the overall low percentage that the lottery raises for states.