The Costs of the Lottery

The practice of dividing property by lot is as old as time itself. Old Testament scripture commands Moses to make a census of the people of Israel, then divide the land into lots. Lotteries were used by ancient Roman emperors to award property and slaves. They were so popular that they became popular forms of entertainment for dinner parties. In Greek, apophoreta meant “that which is carried home.”

Legal minimum

A legal minimum for lottery sales is set by state laws. This is based on the financial soundness and integrity of the retail agent. If a retail agent meets this legal minimum, he or she may apply to sell lottery tickets. Lottery sales are big business, and retail outlets that sell lottery products earn significant profits. The state laws on lottery sales are similar in most states. However, there are exceptions. Generally, lottery prizes are not paid out randomly.


The Scope of lottery refers to gambling activities in which a prize is awarded to a person who owns a specific number. These lottery games are a low-risk, high-reward endeavor, and the scope of lottery fraud is largely unknown. Currently, some governments have bandit lotteries, and some recommend the establishment of a state or national lottery. Depending on the circumstances of the lottery, the prizes can be in the form of cash, goods, or a percentage of the company’s total receipts.


The costs of the lottery are often overlooked in the quest to make the lottery more popular. The Minnesota Lottery, for example, recently changed the format of its Environmental Journal radio spot and Player Spotlight television ads. These costs are included in the state’s advertising budget, as are the costs of television airtime for the Environmental Journal programs. Other costs include the cost of lottery promotion materials, which may be as costly as $50 million a year.

Impact on state budgets

A study in the State and Local Government Review in 1997 examined the impact of earmarked lottery revenues on state education spending. The study’s authors, William N. Evans and Ping Zhang, found that lottery revenue increases state education spending by 11 to 25 percent. The study suggests that the lottery might not be as bad as some people think it is. The study also noted that the lottery may be more likely to attract higher-income consumers.


Federal law prevents the lottery from advertising. There are, however, some exceptions. In Ohio, for example, lottery advertising can be used to coincide with government benefits like Social Security and payroll. The Ohio Super Lotto’s media plan stated that lottery advertising can coincide with government benefits like paychecks. Those who don’t play the lottery are unlikely to be aware of the lottery. And since lottery profits are disproportionately high among low-income groups, this method may actually help reduce regressivity.