A recent study of sports gambling finds that it has a destructive impact on households and long-term financial well-being, a trend that increases when the practice is legalized.
According to a research titled “Gambling Away Stability,” legalizing sports betting has an expected effect on populations, namely, “sports betting spreads quickly, with both the number of participants and frequency of bets increasing over time.”
This betting behavior was found to reduce savings, as “risky bets” crowd out positive expected value investments. In September 2024, The Atlantic reported that for every dollar gambled on sports, two dollars are diverted from investment.
As other recent research has confirmed, online gambling outlets prey on the vast majority of bettors’ biases and lack of skill while excluding skilled bettors from wagering. Keeping the pool of players filled with losers points to the predatory nature of the enterprise.
Bettors who take part in sports gambling are pre-existing gamblers. According to the study, sports bettors are four times more likely to have played the lotto.
As with the lottery in Texas, evidence suggests states can expect potential revenue from sports betting to be offset by “lost tax revenue on investment income and the public costs of managing overextended borrowers.”
A recurring argument made in favor of all forms of gambling is that they have entertainment value. The study found that online sports betting extends beyond the marginal entertainment expenditures, meaning that spending on sports betting exceeds what would normally be spent discretionarily on entertainment.
In 2023, Texas lawmakers introduced measures advocating for sports betting, proposals that ultimately stalled due to resistance from conservative lawmakers and concerns about the social and economic impact of expanded gambling.
Mitch Little, the Republican candidate for House District 65, called the “Gambling Away Stability” paper important, confirming what “we already thought to be true—that Democrats want to use gambling to grow government on the backs of our most vulnerable citizens.”
“Republicans need to decide now whether they want to co-sign one of the largest wealth transfers in history from our most needy citizens to a few winners while leaving only negative economic effects in their wake,” Little told Texas Scorecard.
Little noted that Texas is already second in the nation in credit card debt—over $111 billion—and that legalizing sports betting would “only dig the hole deeper.”
The study backs up this assertion, finding increased consumer debt levels, a greater reliance on high-interest credit, and increased instances of bank account overdrawing. According to the study, legalized sports betting leads to a diversion of funds away from savings and investment accounts.
Little defeated one-term Republican Kronda Thimesch (R-Lewisville) in the 2024 primary election. During the 2023 legislative session, Thimesch voted in favor of HJR 102, a bill to legalize sports gambling in Texas. She also voted in favor of casinos.
