Sports Bettingʼs Rise and the Line Between Entertainment and Problem Gambling
Since 2018, sports betting has exploded in popularity across the United States. With betting now legal in 39 states, Americans wager more than $100 billion annually on sports. Many view these wagers as harmless entertainment, but the rapid growth raises concerns about an increase in problem gambling and its effects on consumers.
Key takeaways:
- Bettors are overoptimistic: in our study, they expect to break even but actually lose 7.5 cents per dollar wagered, with losses on parlays especially underestimated.
- Overoptimism is largest among bettors who partake in a complex type of bet known as a parlay. Compared to other forms of betting, parlays are more likely to be driven by bias.
- A subset of bettors want to reduce their wagering but struggle to do so, reflecting self-control problems similar to other addictive behaviors.
- Current responsible gaming tools — voluntary limits and loss transparency reports — are largely ineffective because they do not address the root behavioral causes of problem gambling.
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