What Influences the Compulsion to Gamble?

Does legalizing gambling lead to addiction?

Source: Thgusstavo Santana/Pexels

Earlier this week, New York became the latest state to make it legal to gamble on all fantasy sports contests, citing this once friendly competition as "a legal game of skill."

In truth, the history of the legality of gambling and gaming has never been cut and dry. Laws vary by state, by the needs of the state (such as Nevada's decision to legalize gambling), and by tiny, seemingly insignificant distinctions in what qualifies as legal gambling.

Betting on horses? Legal.

Buying a lottery ticket? Legal.

Betting while on a riverboat? Legal.

Betting on the dock five feet away from the riverboat? Well...not so much.

Gambling and gaming have proven to be quick, reliable methods for states to acquire money to be used to aid education, rebuild impoverished communities, and now possibly to help local economies recover from the losses of the pandemic.

But, there may be a downside to making it easier for people to gain access to the dopamine rush of a win and the possible financial impact of those whose addiction to that dopamine rush causes them to suffer a much greater financial loss than they can afford.

The question is: As New York and many other states continue to loosen the rules on gambling, are they opening the door to addiction?

The truth is that it depends who you ask.

Do You Take Your Work Home With You?

A 2008 study published in the Journal of Gambling Issues focused on the case studies of six employees of hotels, clubs, and casinos in Queensland, Australia. Interviews were conducted to explore common themes among the employees with the intent to parse apart what came first -- the employer or the addiction. The results clearly identified that all six employees had developed a gambling addiction after they started working within the gambling environment, despite the interventions that had been intended to prevent employee addiction, such as the "responsible gambling training" that was required by their workplaces.

Further investigation found that the urge to gamble was enhanced by frequent exposure to opportunities to gamble as well as the peer pressure-esque exposure to other gamblers, workplace stress, and frequent exposure to marketing and promotional material that glorify gambling.

If we take this small group of people as an example of what occurs in the population at large, it does seem likely that more opportunities to gamble combined with a larger number of peers who are also gambling might open the door for more individuals to develop a gambling addiction or disorder.

Consumer Behavior

A 2011 study by Narayanan & Manchanda determined that addicted gamblers were more likely to act based on irrational beliefs, in particular the "gambler's fallacy." The gambler's fallacy identifies the misguided thought process in which an individual believes that if something happens more frequently in the past, it is less likely to happen in the future.

For example, most of us understand intellectually that if you flip a coin, there is an equal chance of the next flip of the coin landing as either heads or tails.

However, if you flip a coin and it lands 10 times on tails, many people still believe that the next flip will land on heads because it feels as if it should land on heads.

The problem is that when you take this irrational belief into a casino, the gambler gains a false sense of confidence and control that affects how they bet and the risks they take.

Not surprisingly, this study found that addicted gamblers were more likely to believe in irrational beliefs such as the gambler's fallacy.

The Narayanan & Manchanda study was not intended to research the psychology of gamblers, but rather the consumer behavior of addicted gamblers. The finding of this study that is most relevant for our purposes is that targeted marketing increases gambling twice as much in addicted gamblers as it does in casual gamblers.

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If we assume that more lenient gambling laws result in more opportunities to gamble, and allow for the logical conclusion that new opportunities will rely on an increase in marketing and advertising to get the word out, it seems reasonable to assume that more lenient laws might very well increase the number of addicted gamblers, and are almost certain to exacerbate the gambling addiction of those who are already struggling.

The Risk-Return Model

For quite some time, the commonly accepted theory was that some people are simply more comfortable taking risks, regardless of whether they were born this way, or shaped by a positive or negative life experience. Risk-takers were more likely to be sensation-seeking and impulsive, and as a result, would gamble more frequently.

However, in 2021 an Italian study wanted to find out if gambling disorders in adolescent boys could be so easily explained, probing whether those who were more likely to take risks were more likely to gamble excessively. Wouldn't these risk-takers then be more likely to do everything excessively, no matter where they were or who they were with?

Researchers Donati, Weller & Primi examined the effect of the individual's perceived risk versus the perceived benefits of gambling. They found that risk-taking was a greater predictor of gambling disorder than an individual's reported ethics, health and safety concerns, social network, and recreational activity. But, they also found that people who gambled more believed that the benefits of gambling (the likelihood of winning a large amount) were significantly higher. In other words, people who were taking risks were doing so because they believed they had more to win. On the other hand, people who took fewer risks believed they had more to lose.

This would suggest that no matter how many gambling opportunities were available, the same people (those who were high risk-takers who thought the benefits of winning were greater) would be likely to develop a gambling disorder.

So What Do We Know?

There is an extensive amount of literature that reviews the research on addiction in general and gambling addiction specifically. The results of the research on gambling addiction, which is a behavioral addiction, are significantly less black and white than is the case in substance abuse.

We also know that there is impending legislation on the horizon to further open opportunities for gambling, since this provides an additional source of funding for the state as a whole, as well as employment for the residents.

Ultimately, time will tell if the law has accidentally led more addicts astray, but for now, we can only hope that along with legalization will come a responsibility to monitor both employees and customers for signs of addiction.