Lottery Administration and Public Policy



A form of gambling in which winnings are determined by a random process. Modern lotteries are often administered by state governments and may be used for sports team drafts, allocation of scarce medical treatment, or other decision-making situations. They also serve as a popular alternative to paying taxes, encouraging people to pay a small sum of money in return for a chance to win a big jackpot.

In addition to their widespread popularity as a form of gambling, lottery proceeds are often seen as a good source of funds for state government operations. Because lotteries are a voluntary tax, they tend to be more politically acceptable than taxes that require a direct payment from the public. As such, they are particularly attractive in times of economic distress.

Since New Hampshire initiated the modern era of state lotteries in 1964, almost all states have established them. In general, they have been greeted with wide public approval. The reasons given for supporting the lotteries vary widely, but they usually include the claim that the profits will be earmarked for some particular public purpose, such as education.

Nevertheless, critics have argued that lotteries are dangerous because they promote addictive gambling behavior and have a substantial regressive impact on lower-income groups. In addition, they are said to undermine the state’s responsibility to protect its citizens from gambling.

While the popularity of lottery games is unquestionable, it is less clear how much control state officials have over their operations. After all, once a lottery is established, it typically becomes a self-perpetuating system. Revenues grow dramatically in the early years of a lottery, then level off and even decline. The desire to maintain or increase revenues then drives the introduction of new games, such as keno and video poker, and a more aggressive effort at promotional activities.

A key issue is the extent to which lottery officials are accountable to the legislature and the public for their actions. Almost all state lotteries have their own internal bureaucracies, and the authority to make decisions is largely divided between executive and legislative branches. As a result, it is difficult for legislative and executive branch leaders to challenge the direction of the lottery or its operations.

In general, lotteries are well-organized and highly efficient, but there are some issues that require further study. Some important areas for future research include: