The casting of lots for deciding matters and determining fates has a long history in human culture. Among the most important historical lotteries were those used to distribute Roman property and slaves. Privately organized lotteries for prizes of money or goods are more recent and found primarily in the United States. The term “lottery” probably derives from Middle Dutch loterie, and Middle French loterie (a calque on Latin lutrium meaning “action of drawing lots”). The first public lotteries were held in the Low Countries in the 15th century to raise funds for town repairs and to help the poor. In the US, privately sponsored lotteries were introduced with the Continental Congress in 1776 to raise money for the Revolution. They became popular in the 1800s and were the chief source of funds for Harvard, Dartmouth, Yale, King’s College, and other American colleges. Winnings may be paid in a lump sum or in a series of payments over time, but withholdings vary by jurisdiction.
Once established, state lotteries are typically well entrenched with specific constituencies, including convenience store operators; lottery suppliers (who give heavy contributions to the political campaigns of lottery officials); teachers (in those states where proceeds are earmarked for education); and legislators, who become accustomed to the additional revenue and have few incentives to change the policy. The result is that state authorities often have no coherent gambling policy and a tendency to allow the industry to evolve on its own.