Does it Make Sense to Play the Lottery?

A Somewhat Different Take

First, let me say that I am NOT (that is NOT) advising anyone to play the lottery.
Second, if you are gambling and it's out of control, contact Gamblers Anonymous. Gambling can be fun, but it can also be very damaging and addictive.

Lotteries come in a huge variety of forms. There are state-run lotteries, country-run lotteries, and illegal lotteries. There are lotteries with small prizes and relatively good odds of winning, and lotteries with huge prizes and a very very small chance of winning, and all sorts of levels in-between.

Two things all lotteries have in common
All lotteries have two things in common:

1) You can't win

That is, long term, you cannot beat the lottery. The odds are against you, and there is a "house take" or "vigorish" that varies from lottery to lottery, but is always there. For example, in one popular lottery game, you have to pick a three digit number. If you guess it, you get money. In New York State, I believe the payoff is $600 for a $1 bet; but the fair payoff on this form of lottery is $999. If you play this over and over, you will lose.

There is no way to get around this, unless you cheat somehow, and lotteries go to great lengths to prevent cheating and to make the numbers chosen impossible to guess.

The second thing that all lotteries have in common is

2) I don't play them.

So, why am I writing this article? Surely, the answer is "no"?

Maybe.

Two types of lottery games

First, let's divide lotteries (somewhat arbitrarily) into "big prize" games and "little prize" games. The reasoning behind why you might play is different.

In a little prize lottery game, if you play regularly, you can expect to win sometimes. If you take that 3 digit game, you will win, on average, once in every 1000 tries. If you play 5 times a week, that's one win every 4 years or so. If you play 10 times per week, that's one win every two years or so. It's not exactly common, but it will happen. It's just that the amount you've paid out will almost certainly be more - probably much more.