How the Lottery Affects the Social Distribution of Wealth


The lottery is a popular pastime and a form of gambling. It’s been around for centuries, and has been used by governments to raise money for all sorts of things, from building walls and town fortifications to helping the poor. But what’s less well understood is how much it can skew the social distribution of wealth. It’s not just that people like to gamble, it’s that many lottery players come from communities that are already short on resources and have little hope for other sources of income. These are the people who are most likely to be attracted by big jackpots, but if they’re going to win, they’re also more likely to lose.

The history of lotteries dates back to the 15th century, when towns in the Low Countries held public drawings to determine ownership of property or other rights. The first lottery to offer tickets for sale with a prize in the form of cash came in 1612, when James I of England created one to fund his colony in America. It’s unclear how widespread the practice became at that time, but it was certainly common in many European states by the 17th century.

Today, the vast majority of lottery players are men, and a large proportion are lower-income. In fact, the average American buys a ticket at least once a year. But the top 20 to 30 percent of players are responsible for most of the profits. The winners—usually older, higher-educated whites and women—can win huge sums. But the overall odds of winning aren’t as good for most people as the crooked salespeople would like you to think.

To keep ticket sales up, lotteries must pay out a decent portion of the money won by players. But this cuts into the percentage of proceeds that can be collected by state governments and used to support the ostensible reason for having the lottery in the first place. As a result, lotteries can be more regressive than traditional taxes, even though they’re not a visible part of the tax system.

But what’s worse than this is the way that lottery advertising tries to obscure its regressive nature. It’s based on the message that everyone should play because it makes you feel good, that it’s fun to scratch off a ticket. It’s a subtle but dangerous message that obscures the regressiveness of this activity and leads to the false belief that lottery playing is somehow an altruistic act, that it’s okay to spend a significant percentage of your income on these improbable chances for riches.

Posted in: Gambling