University of Maryland Releases Detailed Sports Betting Study
A newly published study from the University of Maryland's Robert H. Smith School of Business, in collaboration with Southern Methodist University's Cox School of Business and the Rady School of Management at the University of California San Diego, provides one of the most detailed assessments to date on the effects of legalizing online sports betting in the US.
LISTEN TO THIS ARTICLE:The report, titled "The Effects of Sports Betting Legalization on Consumer Behavior, State Finances, and Public Health," utilizes a comprehensive panel of anonymized financial transaction data to evaluate the real-world outcomes of legalization in 11 states. The study's findings highlight dramatic changes in consumer behavior following the legalization of online sports betting.
Related: New York Handle Falls Lowest in 10 MonthsAccording to the data, gambling-related spending increased by 369% in states that legalized online wagering. This surge in spending was accompanied by a 372% increase in signs of irresponsible gambling behavior. These figures point to a significant expansion in gambling activity and suggest that legalization not only increases participation but also elevates the risk of problematic behavior among certain segments of the population.
Researchers analyzed data from more than 700,000 individuals across a panel of treatment states that introduced legalized sports betting following the 2018 Supreme Court ruling that overturned the Professional and Amateur Sports Protection Act. Since that decision, 38 states and Washington, D.C. have adopted some form of legal sports wagering, reshaping the landscape of US gambling policy. The University of Maryland-led study is among the first to document the impacts of this shift using large-scale transactional data.
The fiscal impact of legalization was also measured, showing that states gained approximately $0.78 per capita in monthly tax revenue from online sports betting. While this figure translates to millions of dollars annually at the state level, the researchers caution that these fiscal gains must be weighed against social and public health costs.
One of the report's key findings is that lower-income individuals are more likely to engage in risky gambling behavior. These may be disproportionately affected by the downsides of legalization.
More Responsible Gambling News
Online Betting Not a Threat to Physical Casinos
Physical casinos, long concerned about potential revenue losses due to online competition, may find reassurance in the study's conclusions. The data suggests that online sports betting does not cannibalize brick-and-mortar casino revenues.
In fact, in many instances, legalized online betting appears to complement physical casino spending, possibly by increasing overall gambling engagement. This insight is particularly relevant for those states, such as Nevada, that have traditionally been hesitant to embrace widespread online sports wagering due to fears of undermining their casino-based economies.
The study also notes broader behavioral spillovers tied to legalization. Alcohol consumption increased by 20%, and calls to hotlines for problem gambling assistance by 75% following the introduction of legal online sports betting.
These associated effects raise concerns for public health officials and underscore the need for regulatory strategies that address both direct and indirect consequences of expanded gambling access.
Daniel McCarthy, Associate Professor of Marketing at the University of Maryland and one of the study's co-authors, emphasized that while legalization offers fiscal benefits, it also expands access to gambling in ways that may increase financial strain for vulnerable populations. He advocates for policy mechanisms such as income-based betting limits that could mitigate the social risks without eliminating the benefits of regulated betting markets.
RELATED TOPICS: Responsible Gambling
Review this New Post
Leave a Comment
User Comments
Comments for University of Maryland Releases Detailed Sports Betting Study