Something for nothing: A model of gambling behavior

Gambling is an ancient economic activity, but despite its universality and importance, no single explanation for the demand for gambles has gained ascendance among economists. This paper suggests that the demand for gambles is based on the ability to obtain “something for nothing.” That is, the gain from gambling is not merely additional income, but additional income for which the gambler does not need to work. Thus, to fully understand gambling behavior, it must be placed in a labor supply context. The theory is tested empirically using the Survey of Gambling in the U.S. Support for the theory is found.