Economic Costs of Gambling

[South Park]

I think that this is a very skewed way of looking at it.

These negative externalities only apply to problem gambling. Normal gambling is welfare maximising in that it gives those who consume the product utility in the form of enjoyment/entertainment, with the price paid being the house edge.

Definitely a flawed argument imo. There is no need to slander and generalise the gambling industry as a whole when the vast majority of players are simply in it for fun.

This is a classic case of looking at a glass half empty instead of half full, it is true that some people are unable to control their impulses but we see this everywhere, people are addicted to social media, the Internet and video games and yet no one is asking for any of those three things to be banned and that is because despite all of this the good that they bring to the community is simply something we cannot do without, and the same is true for gambling and yet a great deal of people do not understand something that simple.

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[Fatunad]

Gambling operators would never care for the implications of them just existing and profiting. What's important to them is money, and at the end of the day, they will get it from people that are lowkey having fun and those who are extremely addicted. As long as the industry is thriving, pays their taxes, and does not really do harm that is easily recognizable, the government will allow it—except of course on countries with a firm stance against gambling.

Exactly, they will care much more about profits than the wellbeing of their users because what's the point of curing your customers if them being sick is the way that you can make a lot of money. Also, regarding the economic cost, I think gamblong industry is a big contributor with taxes and tourism, just look at Las Vegas, Macau and Hongkong.

Yes, both of you are right as long as the casino can attract many gamblers and they can get more money from them. The casino will not care about the addicted gamblers, how they can solve the addiction, and how the gambler can avoid committing a crime. A gambling industry contributes a big income for the government in the country that allows gambling. The casino does not think much about the side effect of the player in the gambling games because they think that is the gambler's responsibility.

Actually its none of casinos business for them to mind about their players because no one had forced them to play on particular place to play gambling.Therefore,
if they do make out themselves on being addicted due to excessive playing then its actually a personal problem for a certain gambler to resolved on and its no surprise
that casinos wont be minding about those wrecked players because they are the ones who do make out their fate. Playing too much is bad and we know casino is a business and its just normal for them to accept players as much as they can and that what matter most and the rest is never been their responsibility to catch on.

[Hippocrypto]

Hi,

in this thread I would like to address a very important topic: Economic Costs of gambling.

From economic theory we know the concept of externalities:

In economics, an externality is a cost or benefit that is imposed on a third party who did not agree to incur that cost or benefit. For the purpose of these statements, overall cost and benefit to society is defined as the sum of the imputed monetary value of benefits and costs to all parties involved.

Source: https://en.wikipedia.org/wiki/Externality



1. Gambling in fact has many negative externalities. If someone gets addicted, the likelihood is much higher to be depressed. Depression is factor, which leads to high costs for the society.

2. Gambling addiction leads to economic costs because of crime actions. Other market actors have to increase their security standards, which means higher costs.

3. Many gambling addicts go as a consequence to jail. Jail means EXTREMELY high costs to society.

What are your thoughts on this topic?

My thoughts about this topic was at number 3, gamblers with high society conflicts would really tend to go to jail because of their adduction. It's more like drugs which barely beyond control, and they'll able to commit crimes like robbery and qualified theft acts. Same here in my community, even underaged individuals learned how to do stealing due to gambling addiction with small time bets like cards or some kinds of coins game like heads and tails at any public places.

[uneng]

I just saw I forgot to add that it does of course depend on the country and the tax laws. In some countries there is no tax whatsoever on gambling while in others there might be a pretty high tax. What is even more important is from what angle are you looking at the problem? Nationally? Globally? Here is why it is important:

First of all I would say that intuitively an activity where your loss is my gain and your gain is my pain doesn't sound like it could ever be a net positive in terms of social cost.

But people are aware about the risks without being forced to play. And they wouldn't risk losing money if there wouldn't be chances of growing this money at same time. Actually we are hostage of the *your loss is my gain and your gain is my pain* effect in our daily life. Isn't that what governments do charging heavy taxes over basic needs of the people? With the difference in gambling you can choose participating the activity or not.

But apart from that, if we look at a country with a gambling industry (take Nevada, Vegas), of course the statistics will show that Vegas is in an awesome position in terms of social cost. That is the national perspective. But what about the countries that the players came from and spend their money in Vegas? If they win money in Vegas they bring it home, spend it at home and reduce social cost. But no matter how you look at it, it is obvious that that had to come from somewhere in the first place.
So moneys balance can't be the basic measure for social costs here, I think we agree on that.

Foreigner gamblers going to USA to gamble considerable amounts of money are rich businessmen, investors, speculators on their countries. They won't cause externalities to their local governments. There are some common tourists too, but the amounts they bet are insignificant. Of course they could be gambling on their native places, but the local governments should legalize it first, right? The irony here is that they don't want to legalize gambling because it would be harmful to their citizens, but at same they complain people are going abroad to gamble.

One of the questions that remains is does the winner spread so much positive energy that his surrounding society becomes more productive, and does that net out or even exceed the serious cost (maybe he lost it all) incurred by the loser? While the marginal effect of joy is strongly decreasing (that is scientifically proven), the loser could literally lose the ground under his feet, become an alcoholic, lose the job and destroy the family, cause the kids to get off track, maybe is forced to attend psychotherapists and what not.

I don't know, just some thoughts on the issue. I wouldn't look at isolated geographical areas. It is like: hey I got some statistics from Monaco, let's see if gambling their supports or undermines the socioeconomic system...

I think the effects of gambling are positive, yes. Millionaires hate to pay taxes and avoid countries where the rates are high, taking away with them all their wealth, so gambling is the way for a country to get money from them through free will. On long run they lose, but also have fun and won't miss the lost money as they have much more to spend (what also include the maharajas of the judiciary and other public employees).
Furthermore we can't stop doing things we like just because some people don't know limits. This way everyone is being punished for few people's mistakes.

[BuNga_cute]

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Yes, both of you are right as long as the casino can attract many gamblers and they can get more money from them. The casino will not care about the addicted gamblers, how they can solve the addiction, and how the gambler can avoid committing a crime. A gambling industry contributes a big income for the government in the country that allows gambling. The casino does not think much about the side effect of the player in the gambling games because they think that is the gambler's responsibility.

Actually its none of casinos business for them to mind about their players because no one had forced them to play on particular place to play gambling.Therefore,
if they do make out themselves on being addicted due to excessive playing then its actually a personal problem for a certain gambler to resolved on and its no surprise
that casinos wont be minding about those wrecked players because they are the ones who do make out their fate. Playing too much is bad and we know casino is a business and its just normal for them to accept players as much as they can and that what matter most and the rest is never been their responsibility to catch on.

Casinos will be hands off related to gambling addiction problems experienced by some gamblers. Casinos really can't be blamed in this, because
they are not a charity that thinks about helping others, Casino is a place of business and will try to make a lot of money from addicted gamblers.
As long as there is no coercion from the casino to play gambling, the casino is not responsible for the many gamblers who become addicted.
Therefore, it is very important for countries that legalize gambling to provide rehabilitation center facilities, because the state gets tax revenue
from casinos.

[carlfebz2]

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Yes, both of you are right as long as the casino can attract many gamblers and they can get more money from them. The casino will not care about the addicted gamblers, how they can solve the addiction, and how the gambler can avoid committing a crime. A gambling industry contributes a big income for the government in the country that allows gambling. The casino does not think much about the side effect of the player in the gambling games because they think that is the gambler's responsibility.

Actually its none of casinos business for them to mind about their players because no one had forced them to play on particular place to play gambling.Therefore,
if they do make out themselves on being addicted due to excessive playing then its actually a personal problem for a certain gambler to resolved on and its no surprise
that casinos wont be minding about those wrecked players because they are the ones who do make out their fate. Playing too much is bad and we know casino is a business and its just normal for them to accept players as much as they can and that what matter most and the rest is never been their responsibility to catch on.

Casinos will be hands off related to gambling addiction problems experienced by some gamblers. Casinos really can't be blamed in this, because
they are not a charity that thinks about helping others, Casino is a place of business and will try to make a lot of money from addicted gamblers.
As long as there is no coercion from the casino to play gambling, the casino is not responsible for the many gamblers who become addicted.
Therefore, it is very important for countries that legalize gambling to provide rehabilitation center facilities, because the state gets tax revenue
from casinos.

Dont know on whats up to others mind on why they do took the blame into the casino on why gamblers had become affected and had a miserable life just because they do play gambling too much.

It is really out of their hands and this is full responsibility of an individual on handling himself to avoid addiction which might create a problem.\

We cant deny the Cons of gambling in terms of that but lets go back on the brighter side that gambling businesses is one of the biggest tax contributor
on a certain economy.

[Oshosondy]

Not only the casinos but the government as well, they are the ones giving license and regulate the casinos and some of them are also operating a lottery and gambling casinos, both of them do not think the welfare of gamblers and instead just focus on how to make revenues, they are good partners victimizing people who have no control in gambling, they both share the blame. 

That is true, the governments do not focus on the welfare of gamblers, but what do you want the government to do? Should they turn to a gambler advisors? Which is not possible. Gamblers should know how risky gambling is, they should be contented and not gamble with an amount of money that can get them into problem. Also gambling is not allowed in some countries because of the negative effective which is addiction, but yet you will see people in such control trying all means to by-paes the law and gamble both offline and online.

[BuNga_cute]

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Casinos will be hands off related to gambling addiction problems experienced by some gamblers. Casinos really can't be blamed in this, because
they are not a charity that thinks about helping others, Casino is a place of business and will try to make a lot of money from addicted gamblers.
As long as there is no coercion from the casino to play gambling, the casino is not responsible for the many gamblers who become addicted.
Therefore, it is very important for countries that legalize gambling to provide rehabilitation center facilities, because the state gets tax revenue
from casinos.

Dont know on whats up to others mind on why they do took the blame into the casino on why gamblers had become affected and had a miserable life just because they do play gambling too much.

It is really out of their hands and this is full responsibility of an individual on handling himself to avoid addiction which might create a problem.\

We cant deny the Cons of gambling in terms of that but lets go back on the brighter side that gambling businesses is one of the biggest tax contributor
on a certain economy.

Sometimes it is sad for people who are addicted to gambling, then they blame the casino for their situation like that. Regarding the problem of
gambling addiction, it is beyond the control of the casino,  it should be the responsibility of every gambler who already knows the risks of gambling.
Therefore, each country limits the age of those who will play gambling, this is with the intention that people who decide to gamble are adults and
can take responsibility for themselves. Casinos should be appreciated, apart from being able to provide entertainment, but make a big contribution
to the country by paying large taxes.

[imstillthebest]

In economics, an externality is a cost or benefit that is imposed on a third party who did not agree to incur that cost or benefit.

Source: https://en.wikipedia.org/wiki/Externality

gambling involves externality and it was true that a gambler dont agree with the cost but they can agree to the benefit and that is if they earn a profit .

1. Gambling in fact has many negative externalities. If someone gets addicted, the likelihood is much higher to be depressed. Depression is factor, which leads to high costs for the society.

2. Gambling addiction leads to economic costs because of crime actions. Other market actors have to increase their security standards, which means higher costs.

3. Many gambling addicts go as a consequence to jail. Jail means EXTREMELY high costs to society.

i think addicted gamblers hardly get depressed because they are feeding their addiction and it makes them happy at all times . depression is expensive to cure but all cost is not shoulderd by the society , most cost must be paid by the depress patient .  gambling addiction  needs to be combated because it leads to more cost for both the addicted gambler and the society

[rodskee]

I can think of only 1 thing how gambling would benefit the economic circumstances and I think the bad influence of gambling does more harm to the economy. For the time being the positive effects of gambling on the economy is below

We have same view mate according to what gambling is really bringing the world.

Some countries says they are gaining big taxes  from their Gambling casinos but the truth is the losses of their people is more to affect the economy than what adding.

 

The gambling casinos/websites earn a good amount of profits and hence have to pay more tax
The money received from tax is then again used for the welfare of the country.
But yeah, we can still debate with the fact that many casinos dont pay their taxes and many countries don't use the tax properly for the welfare of the country

The best question is , How much does the taxes helping the economy than the amount losses from the players?

[Chato1977]

Yes, both of you are right as long as the casino can attract many gamblers and they can get more money from them. The casino will not care about the addicted gamblers, how they can solve the addiction, and how the gambler can avoid committing a crime. A gambling industry contributes a big income for the government in the country that allows gambling. The casino does not think much about the side effect of the player in the gambling games because they think that is the gambler's responsibility.

Not only the casinos but the government as well, they are the ones giving license and regulate the casinos and some of them are also operating a lottery and gambling casinos, both of them do not think the welfare of gamblers and instead just focus on how to make revenues, they are good partners victimizing people who have no control in gambling, they both share the blame. 

That's why i respect the Muslim countries from banning gambling in their respective countries. though they are at some chance depriving other religions from playing gambling in their territory yet this serve as safety for their people and also for the rest of the place from becoming addicted in gambling.

[pawanjain]

The gambling casinos/websites earn a good amount of profits and hence have to pay more tax
The money received from tax is then again used for the welfare of the country.
But yeah, we can still debate with the fact that many casinos dont pay their taxes and many countries don't use the tax properly for the welfare of the country

The best question is , How much does the taxes helping the economy than the amount losses from the players?

That can never be found out because every country has their own rules and regulations and most of the countries have corrupt people everywhere.
Corruption can go to any extent which is why it's hard to know how much money is actually flowing into the welfare of the economy.
Unless these governments use blockchain system to publicize the taxations there will be no way to know the truth.

[michellee]

Actually its none of casinos business for them to mind about their players because no one had forced them to play on particular place to play gambling.Therefore,
if they do make out themselves on being addicted due to excessive playing then its actually a personal problem for a certain gambler to resolved on and its no surprise
that casinos wont be minding about those wrecked players because they are the ones who do make out their fate. Playing too much is bad and we know casino is a business and its just normal for them to accept players as much as they can and that what matter most and the rest is never been their responsibility to catch on.

A gambler will play base on their choice and they will pick the casino that can make them comfortable playing gambling. The casino does not like when someone is disturbing in their place and they made a riot in their place. The casino can easily kick them out because that person is not given the casino profit like other gamblers. If the gambler becomes addicted, the casino will let them and not carry them to the rehab centre.

Not only the casinos but the government as well, they are the ones giving license and regulate the casinos and some of them are also operating a lottery and gambling casinos, both of them do not think the welfare of gamblers and instead just focus on how to make revenues, they are good partners victimizing people who have no control in gambling, they both share the blame. 

Maybe the government needs to think about the effect of playing gambling on their people so they can warn them not to playing gambling too often. But that will look vague because the government gives license to the casino on one side, and on the other side, they will face many addicted people because of playing gambling. Maybe the people need to think about that seriously not to spend their time only playing gambling. They can play gambling in their free time but not use too big money.

[Renampun]

...

Gambling is where the money goes...

gambling owners, gambling tax recipients, gamblers and gambling addicts are the people who make the money move. the tax money from gambling is large, so the tax recipient is obliged to give rights to gambling addicts who are caught. so I think all parties must carry out their rights and obligations.

[Fredomago]

Not only the casinos but the government as well, they are the ones giving license and regulate the casinos and some of them are also operating a lottery and gambling casinos, both of them do not think the welfare of gamblers and instead just focus on how to make revenues, they are good partners victimizing people who have no control in gambling, they both share the blame. 

That is true, the governments do not focus on the welfare of gamblers, but what do you want the government to do? Should they turn to a gambler advisors? Which is not possible. Gamblers should know how risky gambling is, they should be contented and not gamble with an amount of money that can get them into problem. Also gambling is not allowed in some countries because of the negative effective which is addiction, but yet you will see people in such control trying all means to by-paes the law and gamble both offline and online.

Gamblers should know that and take full responsibilities, the government may bring some rules to avoid addictions but gamblers are the one that really responsible in controlling their actions each time they are inside the gambling house,

though most of the time, the government are more focus in taking profits out of gambling and  not really caring for the welfare of their citizen, as long as the business are producing taxes,

They'll allow the business to facilitate and continue either online or offline shores.

[DoublerHunter]

The gambling casinos/websites earn a good amount of profits and hence have to pay more tax
The money received from tax is then again used for the welfare of the country.
But yeah, we can still debate with the fact that many casinos dont pay their taxes and many countries don't use the tax properly for the welfare of the country

The best question is , How much does the taxes helping the economy than the amount losses from the players?

That can never be found out because every country has their own rules and regulations and most of the countries have corrupt people everywhere.
Corruption can go to any extent which is why it's hard to know how much money is actually flowing into the welfare of the economy.
Unless these governments use blockchain system to publicize the taxations there will be no way to know the truth.

^ That is a good idea and I hope there are some countries who will adopt blockchain technology to have a public ledger about the tax. Every country has its own way how to tax gambling and how the percentage will be deducted as a tax, it could more than 10%-50% depend on which country you are in. Probably gambling industry has a lot of contributing to grow the economy and as I remember there are few countries that have received donations from online gambling casinos. Nevertheless, there are pros and cons in gambling and sometimes we can not deny the fact that there is an economic cost.

[KTChampions]

Bruhhh... In addition to the fact that this topic is strange, it still absolutely does not correspond to some standards of discussion - only a few parameters from the set have been selected. And all of them are negative, which makes me think about the objectivity of the author of the topic.
With this style of discussion, one counter-argument destroys the entire concept being promoted - it is enough to give an example of one successful gambler and the theses put forward become irrelevant.

[passwordnow]

The competition has already started when they've entered in the gambling scene. And that's also the start that they are about to add and contribute to the economy because they're going to make money from their gamblers. But if they've failed to make their business became popular as the other casinos then they have to strategized how they're going to maintain their operations and at the same time get as much as customers as they can for which it will fall for a good marketing team.

They will use many media promotions to attract attention from people out there, including the gamblers who still search for where they can playing gambling. The important thing here how they can invite the gambler and what type of promotion. The gambler needs to search for the right gambling site to play any game he wants and not all gambling sites can satisfy them. Maybe the gambler will search for the casino to give them a big welcome bonus than the other site.

I've seen several newly made casinos that don't even have a budget for their promotions. But as you said, they're going to use campaigns and promotions for their visibility for their customers and that's a usual marketing strategy.
They can do that as a tactic to cater and attract gamblers and let them know that there's a new casino that people should try out. It also lies on the marketing strategist if it's going to click or not.

[ReiMomo]

Not only the casinos but the government as well, they are the ones giving license and regulate the casinos and some of them are also operating a lottery and gambling casinos, both of them do not think the welfare of gamblers and instead just focus on how to make revenues, they are good partners victimizing people who have no control in gambling, they both share the blame. 

That is true, the governments do not focus on the welfare of gamblers, but what do you want the government to do? Should they turn to a gambler advisors? Which is not possible. Gamblers should know how risky gambling is, they should be contented and not gamble with an amount of money that can get them into problem. Also gambling is not allowed in some countries because of the negative effective which is addiction, but yet you will see people in such control trying all means to by-paes the law and gamble both offline and online.

Because they only see the negative side of gambling, in fact, gambling had contributed a lot during when the economy was down and gambling was legally paying tax to the government. And you have a point, gamblers should know that how risky to play gambling, and most of the time gamblers gamble just for the fun not chasing money. Others also gamble on what they can afford to lose.

I don't see any reason that gambling is an economic cost.

[Oshosondy]

Gamblers should know that and take full responsibilities, the government may bring some rules to avoid addictions but gamblers are the one that really responsible in controlling their actions each time they are inside the gambling house,

though most of the time, the government are more focus in taking profits out of gambling and  not really caring for the welfare of their citizen, as long as the business are producing taxes,

They'll allow the business to facilitate and continue either online or offline shores.

What I see to this is that gambling sites will indicate that no one less than 18 should use their service, only 18 and above can gamble using gambling platforms, 18 year is old enough to know the rights and wrongs. But gambling can be addictive, that is where the problem comes in, but the gambling sites do have a page that address the issue of addiction, I also remembered when I once used bet365, there were many restrictions to gambling in a way not to lose much, but I did everything possible to by-pass it all in order to make us of large amount of money, I was an addict and I lost so much money.

What I noticed is that in countries gambling is not restricted or banned, the governments will only go for profits, it is individual and communities that should focus on how people can become not addited to it, and how addicts can become not addicted again to gambling. Even if people are blaming governments that they have nothing to offer to protect gamblers, yet governments will not be concerned.