The word lottery comes from the Dutch noun lot, meaning “fate”; it’s a pun on the English phrase “fate-lot”. In some cultures people place bets to win prizes that are typically cash. These prizes are normally awarded by chance, and in some cases a percentage of profits go to good causes.
The first recorded lotteries were held in the Low Countries in the 15th century, and were used to raise funds for town fortifications and the poor. They proved very popular and were hailed as a painless form of taxation. The oldest still running lottery is the Staatsloterij in the Netherlands, which was started in 1726.
But, in terms of overall state government revenue, the amount of money raised by lotteries is a drop in the bucket, by some estimates as little as 1 or 2 percent. And, as Dave Gulley, an economics professor at Bentley University in Waltham, Massachusetts explains, even if the entire population of the United States were to play the lottery every year for the rest of their lives, they would still only be paying about $50 billion in total.
It may seem strange that a process which relies entirely on chance should be so popular, but it’s an easy sell to many people. After all, we are conditioned to believe that everyone is willing to risk something of value for the chance of getting a great deal more.