The Social Costs of Gambling: An Economic Perspective

Much of the opposition to legalized gambling is based on analyses of the social costs that occur as a result of pathological gambling. It is our contention that many, if not most, authors who have contributed to this literature are either unclear or misguided in what they define as social costs. Instead of starting with a clear definition of what constitutes a social cost, these authors have adopted an ad hoc approach-using "common sense" to determine what constitutes losses to society and then attempting to quantify the impact of those activities. We believe this is not, as some suggest, simply a matter of semantics. Rather, it is a serious problem in the gambling literature. How do we differentiate between a consequence of pathological gambling that is a "social cost" and one that is not? Which of the consequences of addictive behaviors that are associated with gambling arise when gambling is legal, and which will be manifest in some form whether or not gambling is legal? In this article we explain the economic perspective on social costs. An understanding of this paradigm removes the subjectivity in the classification of pathological gambling's social costs. The paper has three major components. First, we introduce the economic notion of social costs. Using this paradigm, we differentiate between the "true" social costs related to pathological gambling, and other negative consequences that cannot legitimately be classified as social costs. Second, we evaluate a recent social cost study using the economics social cost paradigm. Third, we discuss two types of social costs that have been largely overlooked in the gambling literature. One is caused by gambling prohibition. The other occurs as a result of "rent seeking" that is related to the political process surrounding the legalization of gambling.     

Social Costs of Gambling in the Czech Republic 2012

Evidence about social costs of gambling is scarce and the methodology for their calculation has been a subject to strong criticism. We aimed to estimate social costs of gambling in the Czech Republic 2012. This retrospective, prevalence based cost of illness study builds on the revised methodology of Australian Productivity Commission. Social costs of gambling were estimated by combining epidemiological and economic data. Prevalence data on negative consequences of gambling were taken from existing national epidemiological studies. Economic data were taken from various national and international sources. Consequences of problem and pathological gambling only were taken into account. In 2012, the social costs of gambling in the Czech Republic were estimated to range between 541,619 and 619,608 thousands EUR. While personal and family costs accounted for 63% of all social costs, direct medical costs were estimated to range from 0.25 to 0.28% of all social costs only. This is the first study which estimates social costs of gambling in any of the Central and East European countries. It builds upon the solid evidence about prevalence of gambling related problems in the Czech Republic and satisfactorily reliable economic data. However, there is a number of limitations stemming from assumptions that were made, which suggest that the methodology for the calculation of the social costs of gambling needs further development.     

Social Density of Gambling and Its Association with Gambling Problems: An Initial Investigation

The role of social factors in pathological gambling has received relatively little systematic research. The goal of the current study was to examine the relationship between a target individual’s gambling behavior and the gambling behavior among that individual’s parents, siblings and five closest friends. The specific aims were, first, to apply a novel brief assessment to study the social density of factors relating to pathological gambling; second, to replicate previously observed findings involving the social aggregation of alcohol and tobacco use; and third, to examine social density findings among the three domains. Participants were 128 frequent gamblers from the Athens, Georgia area, 79.7 % male with a mean age of 34.2 (SD = 11.7). Participants were assessed using the Diagnostic Interview for Gambling Severity for gambling severity, the Alcohol Use Disorders Identification Test for alcohol abuse, the Fagerstrom Test of Nicotine Dependence for tobacco use, and the novel Brief Social Density of Gambling, Alcohol, and Tobacco Assessment. Significant relationships were observed between participants’ and friends’ activity within all domains: gambling (ps = .001), alcohol use (p < .001) and tobacco use (p < .001). Relationships with friends’ activity across domains were less strong. Distinct patterns of associations with parents and siblings were not observed. Thus, social aggregation was observed across the three domains of potentially addictive behaviors, generally with specificity within domains and with friends, not biological relatives. Methodological considerations and potential applications of these findings are discussed.     

A Perspective on Problem Gambling Treatment: Issues and Challenges

Researchers face several challenges in conducting gambling treatment research. These include the impact of monetary incentives to participate, difficulty in subject recruitment, treatment ambivalence, heterogeneity of gambling behaviors among treatment samples, the role of natural recovery, the impact of intractable financial pressures, and the specification of adequate process and outcome measures. Each challenge is defined and potential resolutions suggested.     

An Experiment on the Social Facilitation of Gambling Behavior

Research and theory regarding the social facilitation effect generates the expectation that the presence of other gamblers (or co-actors) in a gaming venue is likely to intensify individual gambling behavior and magnify losses. Fifty male and 66 female participants (116 total) played a computer-simulated electronic gaming machine with a fixed winning sequence, followed by an indefinite losing sequence. Measures of the intensity of gambling behavior included the final payout (a direct measure of losses), average bet-size, number of trials played, and the speed of play. Some participants received false feedback from the computer designed to suggest that other gamers in adjacent rooms were playing and sometimes winning at the same game. Persons who received both sight and sound information, including winning bells and instant messages regarding the wins of other (fake) players, placed more bets and lost more money compared to the other conditions with less information.     

A Comment on the Utility of Prevalence Estimates of Pathological Gambling

The case is presented that researchers interested in policy aimed at treating the pathological gambler need to shift focus to improving the utility of prevalence estimates. It is argued that researchers supplement prevalence estimates with practical and well-defined measures of severity and other predictors and correlates of help-seeking. The dimension of severity is emphasized as one means of providing estimates that are relevant to policy makers when placed in the context of additional measures that improve their meaning and utility. Estimates may then be partitioned along these dimensions to ascertain the proportion of gamblers most likely to need or seek treatment for gambling-related disorders. The recommendations provided are subject to a number of possible objections and are presented in the interest of stimulating further discussion such as the distinction between symptom assessment and the measurement of severity.     

The Security of Gambling and Gambling with Security: A Rejoinder

Social media has become an established tool to engage and maintain customer loyalty. However, its successful use involves a balance between promotion, public relations and corporate social responsibility. Nineteen individuals working in the Australian gambling industry were interviewed. The aim was to explore how gambling operators are using social media to engage with users and promote products, their considerations underpinning these actions, and the extent to which responsible gambling practices are included. All operators were active on social media and used these platforms to attempt to increase customer engagement and strengthen existing relationships. Gambling-related content was usually balanced against non-gambling content, or operators focused exclusively on non-gambling content. Sales goals or raising revenue were not direct aims of social media use. Operators sought to use social media as an indirect way to maintain their customer base and attract new customers via favourable ratings and information transfer. Few operators provided specific responsible gambling messages, despite being mindful of the dangers of targeting vulnerable populations, specifically young people and problem gamblers. This study is unique as it provides an in-depth first-hand account of how gambling operators are using social media.     

Comment on Wilson and Zurcher's "Status Inconsistency and Participation in Social Movements"

Wilson and Zurcher (1976) set out to discuss the relationships within a set of four variables—income, occupation, education, and pornactivity, that is, activity in relation to two anti-pornography crusades—and to proceed from this discussion to conclusions about status inconsistency as an explanatory framework for the analysis of social movements. We should like to comment on three levels. First we discuss the purely numerical aspects of their analysis; second, the inferences they draw from that analysis; and third, we present some reflections on the theoretical apparatus of Wilson and Zurcher.     

Casino Taxation in Macao: An Economic Perspective

Macao’s gaming industry has experienced dramatic growth for 8 years, yet with certain social costs due to compulsive gambling. The government has come under pressure for tax cuts even though its gaming receipts are falling relatively to the casino retained revenue. The request for tax relief is triggered by a recent decline in net profit despite fast growing gross gaming revenue under favorable market conditions. This is very likely caused by a substantial hike in casino operating costs due to increased competition and might also signal the presence of the principal-agent problem. Given the regressivity of gaming tax with respect to net profit, it is no surprise that casinos with lower profitability are more prone to seek tax cuts. The source of Macao gaming profit hinges on three distinct factors: rising demand from China, monopoly location for casinos, and market structure of oligopoly. These factors provide economic justifications for the current tax regime of Macao with a strong ability to pass tax burdens on to massive visitors. The government relies on casino tax revenue to deal with gambling related problems and promote local diversified development. Pushing for tax variability may create policy instability, business uncertainty, and unpredictable prosperity in the long term.     

Gambling Participation and Social Support Among Older Adults: A Longitudinal Community Study

The purpose of this preliminary study was to examine associations between leaving home to engage in bingo or gambling activity and indices of physical and mental health and social support among a representative community cohort of 1016 elderly people. Cross-sectional and longitudinal data gathered from a prospective epidemiological study in a rural, low socio-economic status, area of Pennsylvania was employed. The cohort had a mean age of 78.8 (SD = 5.1) (range 71–97) and participated in three consecutive biennial waves of data collection. Nearly half (47.7) of the cohort reported gambling. To predict gambling, the independent variables included age, sex, education, employment, social support, depressive symptoms, self-rated health, alcohol use, cigarette use, and cognitive functioning. In cross-sectional, univariate analyses, gambling was associated with younger age, sex (male), fewer years of education, greater social support, lower depression scores, better self-rated health, alcohol use in the past year, and higher cognitive functioning. In a cross-sectional multiple regression model, younger age, greater social support, and alcohol use in the past year remain strongly and independently associated with gambling activity. Longitudinally, age, sex, social support, alcohol use, and gambling are predictive of future gambling activity. The results revealed that gambling may offer a forum of social support to older adults who are often isolated as they age.     

The Gambling Self-Efficacy Questionnaire: An Initial Psychometric Evaluation

Instruments to assess individuals' self-efficacy for the control of addictive behaviors have been useful for monitoring behavior change, predicting maintenance of treatment gains, and identifying potential relapse situations. The Gambling Self-Efficacy Questionnaire (GSEQ) was developed to assess perceived self-efficacy to control gambling behavior. A demographically diverse sample of 309 adult gamblers completed an initial set of 42 items, of which 16 were selected to form the final version of the GSEQ. The GSEQ showed high internal consistency ( = .96) and good test-retest reliability (r = .86). A factor analysis provided some support for a unitary factor structure. As expected, GSEQ scores were negatively correlated with reports of problematic gambling behavior. Participants experiencing problems related to their gambling behavior scored significantly lower on the GSEQ than those who were not experiencing gambling problems. This psychometric examination of the GSEQ supported its potential utility for treatment planning and outcome evaluation with problem gamblers.     

The Social Costs of Child Poverty: A Systematic Review of the Qualitative Evidence

This paper describes a systematic review of qualitative studies of children living in material disadvantage, which compares and confirms experiences across a pool of studies that meet predetermined quality criteria. The review found that, according to children's narratives, the costs of poverty are not only material but also profoundly social. The evidence suggests that, despite their efforts to maximise their resources, many poor children experience a gradual narrowing of their horizons, both socially and economically. In conclusion the paper suggests the need for further research from children's viewpoints, given the UK government's commitment to reducing child poverty and associated problems of social exclusion.     

Homelessness and Social Exclusion: A Foucauldian Perspective for Social Workers

Abstract

The present article considers the malleability of the concept of social exclusion as a tool of policy analysis and intervention in relation to homelessness. The article uses Foucauldian concepts of discourse, power/knowledge and surveillance to pose a challenge to the construction of homelessness as a social exclusion, while alluding to the need for researchers, policy and service provision to be more inclusive of the voices of homeless people in the development of both policy and services. The author argues that the concept of social exclusion, which informs major policy initiatives of the Rann Labor Government in South Australia and the Blair Labour Government in Britain, has a primarily rhetorical purpose and obscures both structural contexts and the subjectivities and lived experience of those labelled homeless.     

A Perspective on Critical Social Work

This paper articulates a perspective on critical social work that draws from poststructuralism and critical theory. Arguing that the critique of positivism, the unreliability of generalizations about humans, and the influence of new social movements have undermined the credibility of mainstream social work practice and theory, the author advocates the need for social work theory and practice that is predicated on social justice. The paper offers a critique of structuralist approaches to practice and then seeks to embed social work practice in epistemic responsibility and communicative responsibility.