Official lottery is a state- or territorial-run gambling game that pays out winnings in the form of prizes and cash. Most jurisdictions have a single lottery, but in some cases, a group of states band together to create multi-state games with larger prize pools. The US Powerball and Mega Millions are two of these. In the United States, each state’s lottery has its own rules and regulations, but both of these national lotteries share a common jackpot system.

As Cohen explains, the lottery’s modern incarnation came about in the nineteen-sixties, when growing awareness of all the money to be made in the gambling business collided with a crisis in state funding. As the economy sagged and the costs of social safety nets grew, many states found themselves unable to balance their budgets without raising taxes or cutting services-both options that were deeply unpopular with voters.

Lottery sales soared, and soon “state after state started to legalize the lottery in order to fill their coffers,” Cohen writes. But the dream that lottery proceeds would be sufficient to finance a state’s business quickly proved to be wishful thinking.

The modern lottery, in its most basic form, has a number of features that distinguish it from other forms of gambling: A central office responsible for collecting and pooling stakes; a set of rules governing frequency and size of prizes; a mechanism for verifying winners; and a distribution network that passes tickets between a hierarchy of agents who charge a premium or discount depending on their rank.