A lottery is a game in which a prize, often cash or goods, is awarded to a random winner or small group of winners. Typically, the prize money is a fixed percentage of the total receipts for the lottery. Alternatively, the prize fund may be a fixed amount of goods or services rather than a cash sum. In either case the prizes are distributed on a predetermined schedule after the sale of tickets. Lotteries have been used by governments and private individuals to raise funds for many projects.
In the United States, most state lotteries sell tickets to win a fixed prize of cash or goods. The odds of winning vary from game to game and are published in the official rules of each game. The odds of winning the grand prize are based on how many tickets are sold and the number of matching numbers.
The first European lotteries in the modern sense of the word appeared in 15th-century Burgundy and Flanders with towns attempting to raise money for fortifications and aiding the poor. Francis I of France permitted lotteries to be run for public profit in several cities between 1520 and 1539. In the American colonies lotteries were a popular method of raising public funds for many projects, including building the British Museum and repairing bridges.
The purchase of lottery tickets cannot be explained by decision models based on expected value maximization, because the ticket prices are so much greater than the expected winnings. However, lottery purchases may be rational if the non-monetary value of entertainment is high enough.