Lottery is a popular form of gambling that involves purchasing tickets for a chance to win a prize. The practice raises billions of dollars annually for state governments, and people from all walks of life play it, even if they understand the odds are astronomically low.

When state lotteries first came into existence, in the 1960s after a long hiatus, they were sold to the public as easy fundraising tools that would funnel millions of dollars to education and other social programs. The promise of a painless tax was especially attractive in the wake of post-World War II economic hardship, when states were grappling with inflation and the high cost of the Vietnam War.

Nevertheless, research shows that lottery revenue does not necessarily boost state government spending in the ways its supporters claim. In fact, it is often a supplemental source of funds, rather than a replacement for existing taxes. This makes it less transparent than a regular tax and thus more prone to controversy.

Further, it appears that lottery revenues tend to expand dramatically when they are introduced but then level off and eventually decline. To keep revenues up, lottery officials must continually introduce new games that entice the public to spend money. This creates a feedback loop that, according to Clotfelter and Cook, ultimately obscures the lottery’s regressivity and other problematic features. As a result, many consumers remain unaware that they are paying an implicit tax when they purchase lottery tickets.