LOTTOS
A lottery is a form of gambling which involves the drawing of lots for a prize. Some governments outlaw it, while others endorse it to the extent of organizing a national lottery. It is common to find some degree of regulation of lottery by governments.
At the beginning of the 20th century, most forms of gambling, including lotteries and sweepstakes, were illegal in many countries, including the U.S.A. and most of Europe. This remained so until after World War II. In the 1960s casinos and lotteries began to appear throughout the world as a means to raise revenue in addition to taxes.
Lotteries are most often run by or on behalf of national or local governments. They are sometimes described as a regressive tax, albeit a voluntary one, since those most likely to buy tickets, and to spend a larger proportion of their money on them, are typically less affluent people. The astronomically high odds against winning the larger prizes have also led to the epithets of a "tax on stupidity" and a "math tax". Although the use of the word "tax" is not strictly correct, these descriptions are intended to suggest that lotteries are government-sanctioned operations which will attract only those people who fail to understand that buying a lottery ticket is a poor economic decision. Indeed, after taking into account the present value of a given lottery prize as a single lump sum cash payment, the impact of any taxes that might apply, and the likelihood of having to share the prize with other winners, it is not uncommon to find that a ticket for a major lottery is worth less than one third of its purchase price. In other words, if a lottery ticket costs US$1 to purchase, its true economic worth may be only US$0.30 or so at the time of purchase. Of course, this is just a hypothetical example, and the actual value will depend on the details of each lottery. Some lotteries may offer tickets that are worth less than 20% of their price, while others may be worth over 50%. To raise money, lottery operators must offer tickets worth much less than what one pays for them, so the lottery is a bad choice for customers trying to come out ahead.
Lotteries come in many formats. The prize can be a fixed amount of cash or goods. In this format there is risk to the organizer if insufficient tickets are sold. More commonly the prize fund will be a fixed percentage of the receipts. A popular form of this is the "50-50" draw where the organizers promise that the prize will be 50% of the revenue. Many recent lotteries allow purchasers to select the numbers on the lottery ticket resulting in the possibility of multiple winners.
The purchase of lottery tickets by large numbers of people is arguably economically irrational. However, in addition to the chance of winning, the ticket may enable some purchasers to experience a thrill and to indulge in a fantasy of becoming wealthy. If the entertainment value (or other non-monetary value) obtained by playing is high enough for a given individual, then the purchase of a lottery ticket could actually represent a gain in overall utility. In such a case, the monetary loss would be outweighed by the non-monetary gain, thus making the purchase a rational decision for that individual.
Lottery tickets are usually scanned in large numbers, using marksense-technology. With today's computer performance, it takes less than one second to check if a particular combination was picked up by anyone, even for lotteries like Euromillions or Mega Millions.
