Making decisions and determining fates by the casting of lots has a long record in human history, from ancient Roman lotteries for municipal repairs to the modern financial lottery. In the latter, people pay to buy a ticket (or tickets), select groups of numbers or have machines randomly spit out numbers, and win prizes if enough of their numbers match those drawn by a machine.
For the lottery to work, a number of things need to be in place. First, there must be a mechanism for recording the identities of bettors and their amounts staked. Traditionally, this has meant a paper ticket or a numbered receipt that the bettor writes his or her name on for later shuffling and selection in the lottery drawing. Today, most lotteries use computer programs for this.
Another requirement is a pool of money from which to award the prizes. This includes the cost of organizing and promoting the lottery as well as a portion that is typically set aside as profit for the state or other lottery sponsor. Lastly, the prize amounts must be attractive to potential bettors. A super-sized jackpot will usually drive lottery sales, as will the promise of free publicity on news websites and on television.
The most difficult issue is balancing the need for state governments to manage an activity from which they profit with the need to provide public services at a reasonable level of taxation. For example, a lottery might help to fund some government-sponsored education initiatives but would not be appropriate for providing police and fire protection services.