Sports gambling takes a toll on Americans' checkbooks, research shows
Researchers have begun measuring the impact of legalized sports gambling on American households, and the initial results paint a worrisome picture about how its expansion has affected bettors’ finances.
Researchers have begun measuring the impact of legalized sports gambling on American households, and the initial results paint a worrisome picture about how its expansion has affected bettors’ finances.
In separate papers released this month, academics have found that households in states where gambling was legalized saw significantly reduced savings, as well as lower investments in assets like stocks that are generally considered more financially sound.
Meanwhile, states that legalized sports betting saw their residents’ aggregate credit scores decrease, while bankruptcies increased.
“Legalization is not a free lunch,” said Scott Baker, associate professor of finance at Northwestern University’s Kellogg School of Management and the lead author on one of the papers.
The “lunch” has nevertheless been substantial for state coffers: New York, which has a 51% tax rate on mobile sports wagering, raked in $862 million last year in tax revenues from the activity and more than $2 billion over the past three years, according to Legal Sports Report — with most of it going toward education. New Jersey, the first state to allow online sports betting, has a much lower tax rate — though it is contemplating an increase — but has still seen $549 million in tax receipts from sports betting since 2018.
Rating: 5