Public Policy and the Lottery

The lottery is one of the most popular forms of gambling in America. In 2021, people spent more than $100 billion on tickets. State governments promote it as a way to raise money. But just how much impact that revenue has on broader state budgets is debatable. The lottery is a classic example of how public policy is often made piecemeal and incrementally, with limited oversight and few opportunities to reconsider decisions.

The drawing of lots to determine property or other rights can be traced back centuries, and lotteries have been used by private and public organizations as a way to fund towns, wars, colleges, and even public-works projects. During the early post-World War II period, states established lotteries as a way to support their growing array of social programs without increasing taxes on low-income families.

There are a number of reasons why people play the lottery: They like to gamble, and they think it’s fun; they may also want to win big and buy their way out of poverty; or they’re looking for a quick fix to a financial crisis. But the most important reason is that the lottery offers a glimpse of wealth and power in a time of inequality and limited mobility.

There’s an educated fool who takes “expected value” as a total truth, mistakenly thinking that lottery tickets are investments like stocks or real estate. This rare creature does with expected value what the ignorant do with education: They misunderstand it and take it as a replacement for actual knowledge and analysis.