The History of State Lottery Programs

Lotteries offer a quick, low-risk way to make money and are a popular pastime for many people. They can be fun to play, but they’re also a regressive form of gambling, with the vast majority of players being lower-income. In addition, playing a lottery can be a dangerous way to get rich, as it focuses one’s attention on instant wealth rather than the more lasting riches that come through hard work and saving (Proverbs 23:5).

The casting of lots for material gain has a long history, including several instances in the Bible and the use of lotteries by ancient Roman emperors to distribute property and slaves. However, state-sponsored lotteries are a relatively recent invention. They were introduced in the immediate post-World War II period when states viewed them as a means of funding public services without raising taxes on the middle and working classes.

These initial rumbles of support prompted many states to adopt lotteries, and their popularity has held steady. But it’s important to consider why that is and how we can draw lessons from the history of this form of state-sponsored gambling.

There are a number of arguments that states have used to justify their adoption of lotteries. One is that they need the revenue from this form of gambling to fund their burgeoning social safety nets. Another is that they believe that gambling is inevitable, and it might as well be legalized and regulated by the state, rather than left to black markets.

In general, state governments promote the lottery by highlighting its “good” aspects. The proceeds go to education, for example. This message works very well, especially in times of economic stress when state government budgets are stretched. But it’s a false argument. In fact, research shows that the objective fiscal health of a state has little impact on whether it adopts a lottery.

A much more revealing argument that lottery commissioners use is that it’s simply fun to play. This is a coded message that obscures the regressive nature of these games and is intended to convince people that they’re not really gambling at all. However, when you talk to dedicated lottery players — people who buy $50, $100 worth of tickets every week — they don’t take this message lightly.

It’s important to recognize the role that state-sponsored lotteries play in this cycle of regressive gambling and the danger of turning it into a recurrent habit. The only way to break this cycle is to stop the promotion of these games by emphasizing their regressive nature and instead focus on teaching people how to save and invest for the long term. If we can do that, the next generation of lottery players will be much better off. And that, in turn, will benefit society as a whole. This is the kind of message we need to send to all our young children. —Adam J. Kline is a professor of economics and public policy at the University of Maryland.