The casting of lots to determine ownership or other rights has a long record in human history, including several examples in the Bible. Lotteries to distribute material goods, however, are relatively recent in Western history. The first recorded public lottery, organized by Augustus Caesar to pay for municipal repairs in Rome, was held in 1466. In the seventeenth century the practice spread to Europe, where it was often used to collect taxes and public utilities fees. State governments in the United States have a legal right to run monopoly lotteries, and most do so. Usually the state creates a publicly owned and operated agency to administer the lottery; begins operations with a modest number of fairly simple games; and, driven by pressure for additional revenues, progressively expands the lottery in size and complexity.
The popularity of lotteries is largely determined by the degree to which they are perceived as promoting some public good, especially education. Nonetheless, studies show that the objective fiscal condition of a state government has little effect on whether or when it adopts a lottery.
Lottery prizes may be awarded in the form of cash, merchandise, services, or combinations thereof. Generally, the prizes are advertised in advance and the rules of each lottery specify the method for determining winners. Prizes may be awarded at random or based on predetermined categories, such as a specified age group or gender. Some lotteries partner with sports teams and other companies to provide popular products as prizes, a practice that generates revenue for both the lottery and the company.
