Lottery is a type of gambling where participants purchase tickets for a chance to win prizes based on a random draw of numbers. Prizes range from cash to goods and services. Most states have lotteries, though some do not. Some people have irrational impulses to gamble, but many others are able to control their gambling.
Although casting lots to determine fates has a long history (and several references in the Bible), lotteries as a means of raising money are of much more recent origin. The first public lotteries were held in the Low Countries during the 15th century to raise funds for town walls and to help the poor. Benjamin Franklin used a lottery to fund the Revolutionary War, and Thomas Jefferson held a private lottery to pay his debts.
The majority of lottery revenue goes to winners, with about a fifth going toward overhead and administrative costs like advertising, staff salaries, legal fees, and ticket printing. Retailers receive commissions for selling tickets, which add up to a significant percentage of the total revenue.
The remaining percentage is divided into various categories to promote the game, such as education and local projects. The problem with this is that while state governments claim that lottery revenue will go to these things, they can be fungible, meaning that the funds simply replace general revenue that would otherwise be spent elsewhere — in pension plans, for example. As a result, the actual benefit to these categories is often small or illusory.