Residents Of Sports Betting States Have Worse Financial Health: Study
A new study has provided more evidence that sports betting is a bad bet for states.
A paper released in July 2024 titled The Financial Consequences of Legalized Sports Gambling used data from the University of California Consumer Credit Panel, which contains detailed financial information from a nationwide credit bureau for a sample of 7 million U.S. adults.
The data included credit scores, credit card balances, loan delinquency information, and many other measures of financial health.
Researchers uncovered some bleak findings:
8% increase in the average amount of debt in collections per consumer due to betting
28% increase in bankruptcy filing likelihood due to online sports betting
3X larger decrease in credit scores in online betting states compared to states with only retail sports betting (brick-and-mortar casinos)
The study didn’t find a significant increase in credit card payment delinquencies because “banks are responding to the increased financial risk caused by sports betting and lowering credit card limits to mitigate potential risk exposure.”
Researchers found that young men are most directly harmed by online sports betting. However, gambling addiction can severely harm many people in the orbit of the problem gambler.
“Legal sports gambling does worsen consumer financial health, especially so when mobile access is allowed,” with some impacts becoming even worse roughly two years after when sports gambling became legal, according to the paper.
The authors noted that taxes generated by online sports betting are fool’s gold.
“While many states may have opted for legalization with the hope of increasing tax revenue, the negative effect we document can offset tax revenue benefits as more consumers’ financial health deteriorates,” the study concluded.
Other studies have shown that 30-40% of online sports bettors experience problems with gambling.
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