Lottery is an organized system of awarding prizes, usually cash or goods, based on a random drawing. It may also refer to a process that allocates something of limited availability, such as units in a subsidized housing block or kindergarten placements at a certain public school.
The idea behind a lottery is that if the entertainment value (or non-monetary benefits) obtained by playing the game outweighs the disutility of losing money, then the purchase of a ticket can be a rational choice for an individual. Lottery is often used by governments to raise money for a variety of purposes.
Originally, the Continental Congress voted to create a lottery to raise funds for the American Revolution. The scheme was eventually abandoned, but over the next 30 years the practice of running smaller public lotteries continued. These were viewed as mechanisms for obtaining “voluntary taxes” and helped establish several American universities, including Harvard, Dartmouth, Yale, King’s College (now Columbia), William and Mary, Union and Brown. Privately organized lotteries were also common in England and the United States, allowing companies to sell products or properties for more money than could be achieved through regular sales.
Americans spend over $80 Billion on Lottery tickets every year – that’s over $600 per household! That money could be better spent on building an emergency fund or paying down credit card debt. It’s also important to understand that the odds of winning a Lottery are very, very low.