Lottery Ethics and Public Policy
Lottery is a form of gambling in which numbers are drawn to win prizes. Its roots go back centuries, and it is still popular in many countries. It has been widely used to raise funds for a variety of purposes, including education and infrastructure. In the US, the lottery has become an important source of revenue, and there are a number of state-run lotteries. The lottery’s rise has generated a number of questions about its ethics and public policy. These issues range from the problem of compulsive gamblers to its regressive impact on lower-income groups. These concerns are partly reactions to, and partly drivers of, the lottery’s continuing evolution.
The casting of lots to decide fates and distribute goods has a long history in human culture, going as far back as the Bible and ancient Rome. However, it was not until the seventeenth century that states began using lotteries to raise money for a variety of public uses. In the United States, colonists established a series of state-run lotteries, even though the Protestant religions strongly forbade gambling. Lotteries helped finance the settlement of America, and they became very popular in the early years of the new republic.
Almost every state in the US runs its own lotteries, and each has its own rules and procedures. But most have some common features: the state legislates a monopoly; establishes a government agency or public corporation to run the lottery (as opposed to licensing a private firm in return for a share of the profits); begins operations with a modest number of relatively simple games; and, due to a constant need for additional revenues, progressively expands its offerings.
Lottery advertising is aimed at persuading people to spend their money on tickets. This inevitably means that it must make claims about the value of the prizes. If these values are high enough, people will make a rational decision to buy the tickets. If the entertainment value of winning is higher than the disutility of a monetary loss, the purchase may represent a positive utility.
In addition to persuading people to spend money, lottery advertising also must convince them that the prize money will be distributed fairly. This is not always easy, and some states have found that they must use a large portion of their revenue to pay prizes. In these cases, there is a risk that the rewards will be concentrated among the rich and powerful, with little benefit to low-income citizens.
The state’s control of the lottery industry has also raised ethical concerns. It is not unusual for governments to develop extensive specific constituencies, such as convenience store owners (who sell the tickets); lottery suppliers (heavy contributions by these businesses to state political campaigns are often reported); teachers (in states in which lottery revenues are earmarked for education); and state legislators (who quickly get accustomed to the extra cash).
