PROBLEM GAMBLING COSTS MAY NEED ANOTHER LOOK

11 January 2008

AGA commissioned study questions research to date


The American Gaming Association, which includes in its membership most of the major land gambling groups in the United States, marked its tenth anniversary by commissioning a series of white papers researched and prepared by respected and erudite experts, and this week one of those studies appeared on the AGA site.

The 14 page white paper appears to come to the startling conclusion that much of the published research into the economic costs of compulsive gambling has ‘deep flaws’ and may overstate the problem, and this novel view is starting to attract media attention.

This white paper examines why little progress has been made in researchers’ ability to adequately identify and measure the potential costs of legalised gambling and strives to provide researchers and policymakers with an understanding of the basic problems inherent in measuring the social costs of gambling.

The research was conducted by Dr. Douglas M. Walker, a professor of economics at the Charleston College, who suggests four fundamental issues must be [and are not always] addressed before researchers can truly begin to estimate the real social costs of gambling:

(1) comorbidity, or the idea that many pathological gamblers have other coexisting disorders;

(2) survey data validity;

(3) measuring government expenditures relating to the treatment of problem gambling; and

(4) the counterfactual scenario, or estimates of societal effects if legalised gambling had not come along.

“Given that many pathological gamblers exhibit other disorders, it is difficult if not impossible to accurately estimate the social costs attributable specifically to pathological gambling,” said Professor Walker regarding comorbidity. “As an example, consider a pathological gambler who is also a drug addict and engages in behaviour resulting in social costs of $5 000. What proportion of the cost should be attributed to the gambling disorder and what proportion to drug use?”

Walker cites a 2005 study that estimated that pathological gamblers suffer unusually high incidences of other disorders including 73.2 percent with alcohol abuse, 38.1 percent with drug abuse and 41.3 percent with anxiety disorders. As a result, many studies reach premature conclusions and ‘attribute all of the costs to gambling’.

“These are complex issues that don’t have easy answers but the methodological issues outlined in this paper must be addressed by researchers in order for policymakers and voters to have a meaningful debate about social costs attributable to gambling,” said Frank Fahrenkopf Jr, President and Chief Executive for the American Gaming Association.

Challenges that Confront Researchers on Estimating the Social Costs of Gambling can be downloaded as a .pdf file from http://www.americangaming.org/publications/10th_anniversary_series.cfm.

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