During the Revolutionary War lotteries were used to raise funds for the Continental Congress. These were public lotteries, run by the government, with a set prize and profit for the promoter. It was thought that people would be willing to hazard a trifling sum for the chance of a considerable gain, and that this could help finance the operations of the colonies without especially onerous taxes on the common people.
Lotteries were a popular means of raising money in Europe in the 15th century. The first recorded lotteries were in the Low Countries, where towns used them to pay for town fortifications and to help the poor. The word “lottery” is derived from the Dutch word for drawing lots.
In modern state lotteries, a government establishes a monopoly for itself and runs the lottery on its own (as opposed to licensing a private firm for a fee). State governments also impose a minimum prize level, a maximum jackpot amount, and rules for purchasing tickets and participating in the drawing. Prize amounts and odds vary from state to state, but the smallest prizes are typically tens of dollars or less.
Americans spend $80 Billion a year on lottery tickets. That’s over $600 per household – money that should go towards building emergency savings or paying off credit card debt. The rules of probability dictate that you can’t increase your odds of winning by playing more frequently or by spending more on each ticket.