There’s no doubt that state lotteries are big business, bringing in billions of dollars each year. But it’s also hard to ignore the ugly underbelly of the lottery: the way that the irrational hope of winning—however unlikely—can become a crutch for people who otherwise have no real economic future.
In the United States, lotteries are a popular source of funding for everything from schools and roads to prisons and hospitals. They’ve been around for centuries, and in colonial America played a major role in financing both private and public ventures, including the foundation of Harvard and Yale and George Washington’s attempt to build a road across the Blue Ridge Mountains.
Today, lottery ads tout large jackpots to lure in players and generate a good deal of free publicity on news sites and TV. As a result, jackpots often reach eye-popping amounts, making the chances of winning seem astronomical. But how much are those odds really worth? To answer that question, you need to know a little bit about hedging and expected value.
Hedging is a strategy that can help you maximize your winnings when playing the lottery. In the most basic form, it involves investing in multiple tickets with different combinations of numbers, aiming to maximize your chance of hitting all the winning combinations. For example, if you play a 6-digit game with a maximum number of combinations, you’d have to purchase 2,500 tickets at $1 apiece to cover every possible combination. That’s not a cheap investment, but it can be more cost-effective than purchasing individual tickets at their face value.
Aside from hedging, another key strategy for increasing your odds of winning the lottery is to break away from the traditional patterns of choosing numbers based on birthdays or other significant dates. While these types of numbers are a great starting point, they limit your opportunities by narrowing your pool of possibilities. By avoiding the obvious, you’ll increase your odds of finding a singleton, or a group of numbers that appear only once on the ticket.
Another important consideration is the way that state lotteries have been structured to attract and retain customers. Since New Hampshire began the modern era of state lotteries in 1964, almost all have followed similar trajectories: the state legislates a monopoly for itself; establishes an agency or public corporation to run it; starts with a small set of relatively simple games; and gradually expands its operation, adding games that require more money to play and more extensive advertising.
The marketing that lottery commissions use to promote their games is subtle, but it’s clear that the message they’re delivering is that lotteries are fun and the experience of buying and scratching a ticket provides value for those who play. This messaging obscures the regressivity of lottery play and the fact that the majority of lottery players come from middle-income neighborhoods, while far fewer proportionally play from low-income areas.