Lottery is a popular form of gambling, in which participants wager small sums of money for the chance to win a large prize. The casting of lots to make decisions and determine fates has a long history in human culture, but using lotteries for material gain is relatively modern. While lottery has been criticized for its addictive nature and its regressive impact on lower-income groups, it is also used to fund public goods and services.

The oldest running lotteries are in the Netherlands, with Staatsloterij being the oldest and still operating today (1726). The English word lottery is probably a derivation from the Dutch noun “lot,” which means “fate.” It is often seen as a painless alternative to taxation and governments at all levels have been quick to adopt it.

In the 17th century, for example, Benjamin Franklin held a lottery to raise funds to build cannons for Philadelphia, and many of the American colonies held lotteries in order to finance public usages. These included libraries, churches, canals, bridges, roads, and colleges.

Since lotteries are operated as businesses whose primary function is to maximize revenues, they promote their products aggressively and focus on reaching specific demographics. In doing so, they risk being at cross-purposes with the wider social policy goals of the government. This creates a dilemma for policymakers, who must balance the benefits of expanding the lottery with concerns about its effects on problem gamblers and other public issues.