The lottery is a system in which people pay a small sum for a chance to win a large sum. The prizes are typically cash or goods. Whether the lottery is for units in a subsidized housing block or kindergarten placements, winning it requires substantial luck or skill. Most people who play have some idea that the odds are long, but they continue to buy tickets because of a sliver of hope that it will be their lucky day.

Lottery revenue expands dramatically shortly after it is introduced, but then plateaus or begins to decline. To maintain or increase revenues, governments introduce a constant stream of new games. Many of these are scratch-off tickets that allow players to instantly know if they have won. Often, the amounts are relatively low and the chances of winning are on the order of 1 in 4. Nevertheless, these products have become a big part of state gaming.

In general, lottery revenue is a good source of revenue for states that need additional revenue without having to raise taxes too much. However, there are also some problems with the way these programs are run. Since they are run as businesses with the primary goal of maximizing revenue, advertising necessarily focuses on persuading groups of people to spend their money on the lottery. This runs at cross-purposes with the public interest, particularly in promoting gambling among socio-economic groups that should be less likely to do it.