Lottery is a form of gambling in which tickets are sold for a chance to win a prize, usually money or goods. It may also refer to:
The word lottery is derived from the Dutch verb lot, which is itself a diminutive of the Latin verb lotere, meaning to choose or draw lots; it is also a calque on Middle French loterie and Old English lotinge, all of which translate as “action of drawing lots.” Modern examples of lotteries include military conscription, commercial promotions in which property is given away by random selection, the selection of jury members, and state-sponsored lotteries that provide for public education.
Although it is possible to find people who win huge sums of money in the lottery, most winners will end up bankrupt within a few years. The reason for this is that the amount of money paid in by lottery players far exceeds the sum that is actually won. Moreover, the percentage of the total that goes to winners tends to be much lower than advertised on TV and in other marketing.
In addition, lottery is often seen as an irrational activity because of the potential for a significant loss. However, the purchase of a ticket can be rational if the entertainment value or other non-monetary benefits obtained by playing are sufficiently high to outweigh the disutility of losing the money. Consequently, decision models based on expected value maximization cannot account for the purchase of a lottery ticket, but those incorporating risk-seeking behavior can.