Lottery: A form of gambling in which prizes are assigned by drawing lots. It is one of the most common forms of gambling in the world, with people spending upwards of $100 billion on tickets each year. Some governments ban it and others promote it as a way to raise revenue—but just how meaningful that revenue is in broader state budgets and whether or not the trade-offs are worth it for the players is something that merits closer examination.

Lotteries have been around for thousands of years, with ancient texts detailing land distribution by lottery and Roman emperors holding public lotteries to give away slaves or property as entertainment. In the American colonies, they financed everything from churches to canals to universities, and by 1744 they had become so popular that the word lotteries was in the Oxford English Dictionary (though it may have been a calque from Middle Dutch loterie).

Today’s lottery is a modern invention. It is a multibillion-dollar enterprise whose prize pool can grow quite large by increasing ticket sales. People choose their own numbers or opt for a quick pick to have the machine choose random ones for them. The more tickets sold, the higher the prize—but if the odds are too easy, someone will win all the time and ticket sales will decline.

Lottery players as a group contribute billions to government receipts, money they could be saving for retirement or college tuition. While the risk-to-reward ratio of a $1 or $2 investment in a lottery ticket might seem appealing, many players find themselves in trouble when their buying habits get out of control. Setting a lottery budget—and sticking to it—can help prevent this from happening.