The practice of making decisions or determining fates by casting lots has a long history, and several instances are recorded in the Bible. Lotteries that distribute prizes for material gain are somewhat more recent. The first recorded public lottery in Europe, held during the reign of Augustus Caesar, raised money for repairs in Rome.
In modern society, we tend to use the word “lottery” to describe any kind of chance-based process that determines something of value, whether it be a piece of property, a place in a school or a job. The most common form of a lottery is one in which people pay for a ticket and then draw numbers for a prize, such as a large sum of cash. A less common form is a lottery that determines a series of events, such as room assignments or units in a subsidized housing project.
State governments promote the adoption of lotteries by stressing their value as a source of “painless” revenue, with voters voluntarily spending their money in exchange for a small chance of becoming wealthy. However, studies show that the actual fiscal circumstances of states do not seem to play a major role in determining whether or when they adopt lotteries. Moreover, once a lottery is in place, its revenues often grow rapidly, but then stabilize or even decline. This leads to the need to constantly introduce new games in order to maintain and even increase revenue.