Lottery is a game of chance operated by state governments in which people have the chance to win a large cash prize for the cost of a ticket. The prizes are typically cash or goods. Lottery tickets are usually sold by agents or vendors who are trained to sell them. Most states also have laws that prohibit anyone from selling a lottery ticket to minors or to persons with mental or physical disabilities. State lotteries are very popular in the United States and raise billions of dollars annually for public purposes. State-sponsored lotteries are not without controversy, however. Some critics of lotteries contend that they promote gambling and are harmful to society, while others point to the fact that state-sponsored lotteries generate substantial profits for public services that might otherwise go unfunded.

A number of different types of lotteries exist, ranging from traditional raffles to instant games such as scratch-off tickets. Most state-sponsored lotteries are based on the principle that the expected utility of a person winning a prize exceeds the disutility of losing money. People who play lotteries are therefore making a rational choice, even though the odds of winning are very low. This is because, in addition to monetary gain, people may gain entertainment or other non-monetary value from playing the lottery.

In the early days of the American republic, state lotteries were a key source of revenue for state projects, including roads, jails, and hospitals. Lotteries provided the new nation with an alternative to taxation, a notion that found favor with leaders like Thomas Jefferson and Benjamin Franklin, who sponsored lotteries to retire debts and buy cannons for Philadelphia.

But the heyday of lotteries came in the post-World War II period, when many states were able to expand their array of public services with relatively little burden on lower-income groups. Some critics argue that lotteries violate the concept of voluntary taxation by preying on the illusory hopes of the poor. Moreover, they contend that state-sponsored lotteries are inefficient ways to collect taxes because they do not take advantage of the economies of scale and efficiencies of mass marketing.

Some critics also argue that lotteries distort economic incentives by diverting business from other state-sponsored and private industries, such as agriculture. They also argue that lotteries contribute to the problems of compulsive gambling. State-sponsored lotteries are a major source of income for problem gamblers, and have led to a variety of criminal activities, from embezzlement to bank holdups.

Still other critics point out that state-sponsored lotteries are inconsistent with the moral principles of freedom and justice. They assert that government should not encourage the consumption of illegal drugs, alcohol, or tobacco by offering it to its citizens in the form of a state-sponsored lottery. They also note that the popularity of the lottery is not consistent with the idea that people have a right to control their own spending. Finally, they argue that state-sponsored lotteries may be at cross-purposes with the larger public interest in providing adequate social safety nets and services for its citizens.