Lottery is a popular form of gambling that appeals to the human inclination to dream big and believe they can get rich quickly. People’s intuitions about how likely risks and rewards are within their own experience work in lotteries’ favor, but the scale of the lottery’s payouts makes it easy to underestimate just how rare a winning ticket can be.
Lotteries have been around for centuries, with the Old Testament instructing Moses to take a census and divide land among the people by lot and Roman emperors using them to give away property and slaves. They were brought to the United States by British colonists and initially drew a mixed reaction from Christians, with ten states banning them between 1844 and 1859.
The origin of the word “lottery” is unclear, but it’s possible that it’s a corruption of Middle Dutch lötjere, or lotinge, meaning “action of drawing lots”. The earliest recorded use of the term was in the 15th century in the Low Countries, when towns held public lotteries to raise money for town fortifications and help the poor.
The reason that a person chooses to play a lottery is based on his or her expected utility, which is the total value of the monetary and non-monetary benefits gained by playing. If the entertainment value is high enough, the disutility of a monetary loss could be outweighed by the combined utility of winning, making it a rational decision for that individual. If the entertainment value is low, however, the disutility of losing outweighs the gain and a lottery purchase becomes irrational.
