In Ontario, research has found a sharp rise in gambling-related helpline contacts among young men since the province expanded private online gambling.

Is gambling just a vice market that is inevitable, and should therefore be taxed? A good bit of fun, and a viable economic activity to boot? Both sets of framing miss the mark. My latest Inside Policy Talks episode with Keldon Bester uses online gambling, sports betting, and prediction markets as a case study in how we ought to assess the total impact of a market.

Gambling can be morally or behaviourally corrosive, as it most certainly is. But more importantly, even the economic case for it only tells a positive story if you leave out the full cost picture, both fiscal and social. If we have a fulsome conception of value and cost in economics, we should expect markets built around compulsion and dependency to generate negative economic effects that show up in the models. 

This is exactly what the evidence increasingly shows for those looking for the full picture: indebtedness, bankruptcy, financial stress, rising suicide and numerous other social ills.

In Ontario, research has found a sharp rise in gambling-related helpline contacts among young men since the province expanded private online gambling, and reporting has also pointed to a major rise in gambling-linked insolvencies. In the United States, new research has linked legalized online sports betting to worsening consumer financial outcomes, including lower credit scores and higher rates of delinquency and bankruptcy.

There is no such thing as a private choice with fully isolated consequences, and I highly doubt that private vice is ever the price to pay for public virtue.

This conversation is ultimately about measurement and political economy. If we measure only revenue, growth, jobs, or consumer demand, we will end up with a badly distorted picture of a policy or business model’s real impact. We need a fuller accounting that includes the downstream effects.

Keldon and I discuss the rapid normalization of gambling through apps, sports broadcasts, and digital platforms, the blurring of gambling and finance through prediction markets, and the larger question that all of this raises – what should count when we judge whether a market is actually good?

Also available on Spotify and Apple podcast