Economics

The Real Effects of Gambling

Don't believe the hype. The epidemic of pathological gambling is hugely exaggerated.

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Gambling has proliferated in America in recent years, and it's not about to stop. The Illinois legislature has approved a bill authorizing more casinos as well as slot machines at race tracks. Ohio has four new casinos in the pipeline. Maine voters approved a new one last year. Massachusetts lawmakers plan to consider a gambling expansion this fall.

To critics, this spells trouble: more gambling, more problem gamblers, and more of the calamitous social ills that follow. But the fear stems from the assumption that demand inexorably rises to match supply—that each new gambling site increases the number of people who gamble and the amount of money they bet. That, we have learned, is not quite how human beings respond.

The latest news comes from Howard Shaffer, an associate professor of psychiatry at Harvard Medical School. His recent article, co-authored by Harvard colleague Ryan Martin in the Annual Review of Clinical Psychology, offers reassuring evidence.

"The current available evidence," they found, "suggests that the rate of PG (pathological gambling) has remained relatively stable during the past 35 years despite an unprecedented increase in opportunities and access to gambling."

I called Shaffer, one of the country's leading experts on this and other addictions, to ask what citizens should expect when gambling expands in their states. He does not sound alarmed.

"When gambling becomes newly available in an area, you'll see some increase in gambling," he says. "Some people who would not have gambled become willing to try." That's especially true in places that (unlike Illinois) had no legal gambling before. But the effect, contrary to myth, soon subsides.

"I was so wrong about this when I started this work," Shaffer admits. He expected it would take generations for people to adjust their behavior in response to greater availability. In fact, "people gambling on the Internet change from gambling more to less in weeks. We never would have predicted that."

Online access is a good test of the alleged hazards of allowing people to wager on games of chance. It is said to be particularly dangerous because it is anonymous, immune to supervision, and accessible anytime, anywhere. "With virtual casinos entering the homes of millions every day, the chances for addiction are only going to increase," warns CRC Health Group, which offers treatment for problem gambling.

"We expected it to be the Wild West of gambling," Shaffer recalls. "People could sit in front of a computer with a credit card and just go."

Online gambling is illegal in the United States. But in the countries where it's allowed, most people take a pass. "People discover it isn't that much fun to gamble alone," he notes, except for those with social problems. "The extent of Internet gambling for most is astoundingly moderate."

Another surprise for Shaffer was that in most cases, problem gambling is not "a relentless progressive disorder." If you smoke a few cigarettes, you'll probably soon be smoking every day. If you shoot heroin a couple of times, pretty soon you won't be able to live without it. But for the vast majority of those who gamble, control comes easy.

"It's a problem people react to," Shaffer reports. In fact, he says, "Problem gamblers are more likely to get better than worse."

Some problem gamblers, of course, do get worse, with harmful and even disastrous consequences for themselves and those around them. But Shaffer suggests that excessive gambling is not a highly contagious malady that can infect anyone who enters a casino. It's usually a symptom of some underlying disorder.

"Of people in the U.S. with gambling problems, about 75 percent had a mental health problem first and a gambling problem second," he notes. That, it stands to reason, makes efforts to outlaw gambling a pointless enterprise. He says that "some problem gamblers would have difficulties with gambling or something else even if there were no legal gambling available."

In any case, the epidemic of pathological gambling is hugely exaggerated. Studies indicate, according to Shaffer, that about 5 percent of Americans will ever have a gambling problem. Compare that with about 8.5 percent who suffer from alcohol problems annually and 25 percent who smoke cigarettes.

Allowing more casinos and other gambling opportunities is not likely to produce the great economic benefits often promised. But as a way of accommodating consumer preferences without serious social side effects, it's a pretty safe bet.

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