The Lottery is a Big Business

Lottery is a big business, and its advertising is aimed at persuading people to spend large amounts of money on tickets. In many states, a significant portion of lottery proceeds are earmarked for education. This argument seems especially persuasive during periods of economic stress, when state governments need more money and are facing budget cuts. But, as Clotfelter and Cook note, it’s also true that lotteries seem to gain wide public approval regardless of the actual fiscal circumstances of a state. Lotteries also develop broad constituencies, including convenience store operators (who are the lottery’s usual vendors); suppliers of lottery-related merchandise; teachers in those states where a substantial part of proceeds are earmarked for education; and state legislators who become accustomed to the extra revenue.

Lotteries rely on an inexorable human urge to gamble, which is why they advertise jackpots in large numbers and with eye-catching billboards. They also dangle the possibility of instant riches, a tempting offer in an age of inequality and limited social mobility. And, because they’re run as businesses, lotteries are constantly seeking ways to increase revenues. In the past, this meant expanding the variety of games available and adding new ones. But now, with the advent of online gambling and mobile devices, the industry is changing again.