The impact of wealth expectations on the incidence of lottery gambling
Date
2010-03
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Abstract
Gambling is especially problematic in third-world countries such as the Philippines because of one thing: it is not self-limiting. Logically, when disposable income runs out, the betting stops. However, in the Philippines, people go so far as to plunge themselves into debt to continue gambling. Much-needed savings are diverted to such risky activities instead of productive investments. This is a pervasive problem in a country where more than half the population suffers from poverty. Despite the deep-seated and long-running culture that propagates this problem, no major research has been done on the motivations behind these irrational economic decisions. Relevant entities instead rely on classic studies that tie gambling to common identifiers such as lack of education and job opportunities. However, as this study sets out to prove, this is no longer sufficient in explaining gambling behavior.
Using recent national-level data from the Social Weather Stations, the authors ran a logistical regression that determined the variables that affected the odds of participating in lotteries. The model was able to produce results that contradict previous studies or popular expectations, such as the fact that higher levels of education actually increase the odds of gambling. Other important results point to a different way of thinking about gambling behavior, such as the fact that purchasing power is not significant in influencing the decision to gamble, but how the individual perceives his quality of life in relation to the past is. The results imply that individual wealth expectations and the factors that can distort these are the primary motivators in deciding to gamble.
This study concludes with a set of recommendations for policy makers that target these factors. Some of these recommendations include providing income safety nets, addressing unemployment issues especially for fresh graduates, improving income equity, investing in human development and implementing programs that make investing in productive ventures like businesses more attractive.
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Keywords
Gambling, Lottery gambling, Wealth, Wealth expectations, Consumer behavior