Why People Love Playing the Lottery

Across the country, people spend billions buying lottery tickets each week. They do so even though the odds of winning are incredibly low. It’s an activity that many consider part of their civic duty. They argue that by playing the lottery, they’re doing a “good deed” for the state. They’re helping to educate children, for example. But, in reality, the money they contribute to government coffers could be better invested elsewhere—for example, in a savings account for their retirement or their children’s college tuition.

In other words, the lottery is a form of hidden tax. But the reason it’s so popular isn’t really about that: It’s about an appeal to human nature.

Lotteries typically win broad public approval by promoting themselves as benefiting a specific public good, such as education. These messages are highly effective, even during periods of economic stress, when state governments are under pressure to raise taxes or cut other programs.

The fact is, however, that state lotteries generate revenues in relatively short order and then level off or decline. They are prone to what economists call “boredom” after a few years, so they must continually introduce new games to maintain or grow their market share. It’s a tricky business because adding new games is expensive and time-consuming, and the resulting revenues are often volatile. So the challenge is to find a way to make these new games successful, based on research and consumer feedback.