The casting of lots for decisions or for determining fates has a long history in human culture, as shown by several instances in the Bible and by ancient lottery games in China and Rome. Modern lotteries began in Europe in the 15th century, when towns held public lotteries to raise money for walls and town fortifications or to help the poor. The name derives from the Dutch word lot, meaning “fate.”
In colonial America lotteries were often used for all or portions of financing such projects as building the British Museum and repairing bridges, constructing buildings at Harvard and Yale, and funding the military and colonial government. Even George Washington sponsored a lottery in 1768 to build a road across the Blue Ridge Mountains.
Lotteries are promoted as a source of “painless” revenue: people spend money to play the lottery, which is then collected by the state and redistributed for a variety of public uses, without raising taxes. Politicians often endorse lotteries because they are seen as a way to get the people’s money without the voters having to vote for an increase in the state budget.
In reality, however, the majority of lottery money goes to a few large, very well-connected, and heavily lobbied entities. The public gets very little benefit from the rest of the money. Moreover, the evolution of lottery policy is a classic case of fragmented decision-making, in which state officials rarely look at the overall impact of the industry on the general public or take a unified approach to its regulation.