The casting of lots for decisions and fates has a long record in human history. Lotteries, however, that offer prizes of money are relatively recent. The first public lottery to distribute cash prizes was organized in 1466 in Bruges, Belgium, for the stated purpose of helping the poor. In the United States, state-run lotteries grew rapidly after 1964, and have become an integral part of American life.
Lotteries are characterized by broad public approval and high participation among the general population. They are able to maintain broad support even when the economy is stressed because they can be presented as a source of painless revenue, in which players voluntarily spend their money for the benefit of the public good. In fact, state lotteries have proven to be extraordinarily resilient in the face of budgetary stress.
State lotteries are run as businesses that aim to maximize revenues, and their marketing strategies resemble those of other businesses that sell products aimed at specific market segments. Their success depends on attracting players from all income levels and demographics. In order to attract these consumers, they must provide games that appeal to them.
To sustain the growth of the business, state lotteries must constantly introduce new games and increase their promotional expenditures. While these activities have proven effective in bringing in revenue, they raise important questions about whether the lottery is serving its proper public function. In the short term, revenues expand rapidly after a lottery is introduced, but then they plateau and eventually decline. The lottery industry tries to avoid a decline by introducing new games that appeal to people’s boredom and desire to win more prizes.