i found much of your analysis compelling except the Portnoy aside. That's a 20 point blow-out and a miserable watch, but the O/U was live and added interest to an otherewise boring, uncompetitive game. A better example is if people start caring about the O/U vs the outcome of a close game in my opinion.
Missed opportunity for a) an intro to the Conjunction Fallacy wrt parleys; and b) advocating some form of Pigouvian tax* as an amelioration rather than wholesale bans. It just seems ridiculous to entertain hypotheticals of taking a popular trivially-easy-frictionless app thing and making people go back to visiting the brick and mortal bookies. Would the governments force Draftkings to implement geofencing or something?
A good article otherwise. To some degree, it's always whack-a-mole - people who'd bet on sportsball are also likely to bet on crypto or Robinhood. But that doesn't mean it's not worthwhile to align incentives and adjust to each new "vice" as they appear. Still sad we fumbled this pretty badly with vaping.
*sleeper October Surprise: DJT announces new campaign plank to outlaw taxation of gambling winnings. "Only losers tax winners!"
Very good article. But in the case of the announcers cheering for an over, yes that does make an otherwise boring game more entertaining. Just as fantasy sports makes a blowout or dull game more fun to watch if one of my players on the team and makes a play.
Excuse me?! The problem went from 1,000 a year to 2,000 a year? So... from minuscule to, err, still minuscule?
Look, freedom means some people are going to hurt themselves. And that's fine. We cannot engineer society to prevent every self harm. I am a bit overweight coz I find it hard to resist eating. Not even bad or highly engineered food, just a bit of cheese and bread or confiture in my yoghurt that I should stay away from. I don't think limiting calories intake for everyone is the solution.
Hopefully, Ozempic and its successors will help gambling addicts like it helps food addicts.
As I age and see more and more previously hidden, subversive, niche, underground, perhaps illegal subcultures dragged into the light and commodified, I feel like things were better when interesting things like drugs or drag or gambling weren't for everyone.
I'm probably too late on this, but for most drugs (including weed) and gambling, people shouldn't go for jail for or get fined for making bets or smoking pot, but none of it should be government backed or approved of. The legal grey area pot had in most West Coast cities in the mid-2000's pre -legalization and gambling had in many major cities is probably the best place, societally.
So, yeah, want to sell dime bags or do a betting pool for March Madness? Go with God. But, no opening chains of betting shops or weed shops or running commercials right after one for State Farm. Probably some form of system of medical legalization for weed is necessary, but it needs to be more controlled than what happened with medical legalization basically everywhere.
I realize this idea probably upsets the more right-leaning paternalistic types on this issue who want Singapore and the libertarians.
Does anyone really care that the online poker boom died a horrible death in the US when the UIGEA passed? Seems like you could put the genie back in the bottle on sports betting.
Sports gambling has actively made me less interested in sports. I spent Thanksgiving with my in-laws, and literally all anyone was talking about with the football games was about what they'd bet and whether they were on track to make their parley.
That said, sports gambling isn't the only type that needs regulation. Much as I love Genshin Impact, gacha/lootbox games clearly also need similar regulation. Aside from advertising regulation, I wish we had some kinds of limits on how much you can spend in one sitting without getting some kind of license. It would at least prevent kids from going crazy with their parents' linked credit cards.
Sudden idea I just had to address excessive gambling that may or may not be half baked: as a condition to discharge gambling related debt in bankruptcy, one has to agree not to gamble further.
Edit: Oh no this formatting is atrocious and I can't figure out how to make it better.
If I worked for DraftKings, here's what I'd do* in my CRM:
1) Use push notifications to increase LTV; offer a bonus for a push token if someone declines initially
2) Identify users who decreased purchasing to reverse or determine why and prevent in other users
3) Analyze low to high LTV users and isolate demographics or behaviors to target; survey
4) A/B test messaging to determine best-converting timing, copy, CTAs, etc.
And what that would translate to for a subset of users is:
1) Making sure I can talk them into gambling at any given moment
2) Pull someone out of gambling addiction recovery or prevent other addicted gamblers from initiating recovery
3) Figure out or directly ask addicted gamblers what led to addiction so that I could replicate it
4) Determine the best ways to turn people into addicted gamblers
*I haven't had to look into the applicable ToS or laws around this for a bit, so if I said anything that's not allowed then whoops. Platforms tweak their ToS somewhat regularly.
You can make the argument that people can become addicted to anything (buying clothes, trading stocks, scrolling feeds). At the end of the day I'm not a libertarian, so I wouldn't mind intervention into a few vices.
I feel like this topic could benefit from a wider view. Analysis of the pros and cons of other laws and regs designed for other addictive dopamine hits like, alcohol, smoking, drugs, junk food, pornography, video games etc would be very useful in helping me decide how I feel about the specifics of each one.
It's such a tough issue, because one group of people's awesome afterwork bar hangout is another person's life-ruining alcoholism, and criminalizing things has mixed effects.
So maybe banning ads is the right answer? Since that's the equilibrium we've kind of arrived at for some of these other vices, and it seems like one of the most stable equilibriums compared to other vice laws that people are always arguing about. In any case, it's either an understudied issue or I'm simply under-read.
I think there are significant enough differences between the vices that the best policies will be quite different. But it will still be worth studying them, to figure out which ones are dependent on which features.
For some of them, a tax or fee is probably sufficient, while for others restricting advertising is, and for others (certain opioids) you probably want a nearly complete ban. But understanding why they are amenable to different treatments is interesting and hard.
(As an example - if you go on a bender, a problem eater of fast food might eat twice their normal amount, a problem drinker might drink five times their normal amount, and a problem gambler might gamble a hundred times their normal amount. So focusing on benders is more important for problem gambling and less important for problem eating.)
The people with the worst problems might find a way to blow their money. After all, what difference does it make if you go broke after a yearly trip to LV or steadily in the year? That said, at least a few people will stumble into an addiction they didn't know they had.
If we're only concerned about problem gamblers then that's what I think the shape of the issue is. But if we think regular joes blowing money at fingertip casinos is also a problem, then we have to acknowledge that the advertising must be working or they wouldn't do it. It kind of reminds me of how a former co-worker who worked at TDAmeritrade told me that they were "essentially a marketing company"
Yes they would still consume a lot but they would not consume as much. I drink more in Europe than I do stateside because I can go to bars here. Legality matters.
Having watched the movie "Dumb Money" I'm having a little bit of difficulty separating the evils of sports betting from the unalloyed goodness of the stock market. Yes, it provides market information, rewards/punishes firms yadda yadda yadda. But doesn't it have something of the same problem of incentivizing the behavior of betting addicts?
Do people say the stock market is *unalloyed* good? I thought the usual economist view is that it’s extremely good, but doesn’t rule out the possibility that there might be a bit of bad alloyed in there.
As a parent, I would love help from the government and/or from other societal institutions in keeping my kids away from gambling, porn, drugs, etc. But Americans tend to chafe at being told what to do (Covid rules, abortion restrictions, etc.). How to thread the needle?
Getting people to see these restrictions as ones they choose themself would be great. Mark Kleiman had a proposal for marijuana legalization - by default, everyone should have a limit on their monthly marijuana purchases, and it should be possible to change your own limit to whatever you want, but increases to that limit would not take effect until the month after next. Enabling people to delay the effects of their actions would enable them to use their own long term thinking to control their short term compulsion.
i found much of your analysis compelling except the Portnoy aside. That's a 20 point blow-out and a miserable watch, but the O/U was live and added interest to an otherewise boring, uncompetitive game. A better example is if people start caring about the O/U vs the outcome of a close game in my opinion.
Missed opportunity for a) an intro to the Conjunction Fallacy wrt parleys; and b) advocating some form of Pigouvian tax* as an amelioration rather than wholesale bans. It just seems ridiculous to entertain hypotheticals of taking a popular trivially-easy-frictionless app thing and making people go back to visiting the brick and mortal bookies. Would the governments force Draftkings to implement geofencing or something?
A good article otherwise. To some degree, it's always whack-a-mole - people who'd bet on sportsball are also likely to bet on crypto or Robinhood. But that doesn't mean it's not worthwhile to align incentives and adjust to each new "vice" as they appear. Still sad we fumbled this pretty badly with vaping.
*sleeper October Surprise: DJT announces new campaign plank to outlaw taxation of gambling winnings. "Only losers tax winners!"
Not everyone can control their addictions. In Austria gambling advertising is everywhere so it is pervasive.
Here is an example: https://youtu.be/ilwP51aLOD8?feature=shared
Very good article. But in the case of the announcers cheering for an over, yes that does make an otherwise boring game more entertaining. Just as fantasy sports makes a blowout or dull game more fun to watch if one of my players on the team and makes a play.
Excuse me?! The problem went from 1,000 a year to 2,000 a year? So... from minuscule to, err, still minuscule?
Look, freedom means some people are going to hurt themselves. And that's fine. We cannot engineer society to prevent every self harm. I am a bit overweight coz I find it hard to resist eating. Not even bad or highly engineered food, just a bit of cheese and bread or confiture in my yoghurt that I should stay away from. I don't think limiting calories intake for everyone is the solution.
Hopefully, Ozempic and its successors will help gambling addicts like it helps food addicts.
As I age and see more and more previously hidden, subversive, niche, underground, perhaps illegal subcultures dragged into the light and commodified, I feel like things were better when interesting things like drugs or drag or gambling weren't for everyone.
I'm probably too late on this, but for most drugs (including weed) and gambling, people shouldn't go for jail for or get fined for making bets or smoking pot, but none of it should be government backed or approved of. The legal grey area pot had in most West Coast cities in the mid-2000's pre -legalization and gambling had in many major cities is probably the best place, societally.
So, yeah, want to sell dime bags or do a betting pool for March Madness? Go with God. But, no opening chains of betting shops or weed shops or running commercials right after one for State Farm. Probably some form of system of medical legalization for weed is necessary, but it needs to be more controlled than what happened with medical legalization basically everywhere.
I realize this idea probably upsets the more right-leaning paternalistic types on this issue who want Singapore and the libertarians.
Does anyone really care that the online poker boom died a horrible death in the US when the UIGEA passed? Seems like you could put the genie back in the bottle on sports betting.
Sports gambling has actively made me less interested in sports. I spent Thanksgiving with my in-laws, and literally all anyone was talking about with the football games was about what they'd bet and whether they were on track to make their parley.
That said, sports gambling isn't the only type that needs regulation. Much as I love Genshin Impact, gacha/lootbox games clearly also need similar regulation. Aside from advertising regulation, I wish we had some kinds of limits on how much you can spend in one sitting without getting some kind of license. It would at least prevent kids from going crazy with their parents' linked credit cards.
Sudden idea I just had to address excessive gambling that may or may not be half baked: as a condition to discharge gambling related debt in bankruptcy, one has to agree not to gamble further.
Amen
Edit: Oh no this formatting is atrocious and I can't figure out how to make it better.
If I worked for DraftKings, here's what I'd do* in my CRM:
1) Use push notifications to increase LTV; offer a bonus for a push token if someone declines initially
2) Identify users who decreased purchasing to reverse or determine why and prevent in other users
3) Analyze low to high LTV users and isolate demographics or behaviors to target; survey
4) A/B test messaging to determine best-converting timing, copy, CTAs, etc.
And what that would translate to for a subset of users is:
1) Making sure I can talk them into gambling at any given moment
2) Pull someone out of gambling addiction recovery or prevent other addicted gamblers from initiating recovery
3) Figure out or directly ask addicted gamblers what led to addiction so that I could replicate it
4) Determine the best ways to turn people into addicted gamblers
*I haven't had to look into the applicable ToS or laws around this for a bit, so if I said anything that's not allowed then whoops. Platforms tweak their ToS somewhat regularly.
You can make the argument that people can become addicted to anything (buying clothes, trading stocks, scrolling feeds). At the end of the day I'm not a libertarian, so I wouldn't mind intervention into a few vices.
I feel like this topic could benefit from a wider view. Analysis of the pros and cons of other laws and regs designed for other addictive dopamine hits like, alcohol, smoking, drugs, junk food, pornography, video games etc would be very useful in helping me decide how I feel about the specifics of each one.
It's such a tough issue, because one group of people's awesome afterwork bar hangout is another person's life-ruining alcoholism, and criminalizing things has mixed effects.
So maybe banning ads is the right answer? Since that's the equilibrium we've kind of arrived at for some of these other vices, and it seems like one of the most stable equilibriums compared to other vice laws that people are always arguing about. In any case, it's either an understudied issue or I'm simply under-read.
I think there are significant enough differences between the vices that the best policies will be quite different. But it will still be worth studying them, to figure out which ones are dependent on which features.
For some of them, a tax or fee is probably sufficient, while for others restricting advertising is, and for others (certain opioids) you probably want a nearly complete ban. But understanding why they are amenable to different treatments is interesting and hard.
(As an example - if you go on a bender, a problem eater of fast food might eat twice their normal amount, a problem drinker might drink five times their normal amount, and a problem gambler might gamble a hundred times their normal amount. So focusing on benders is more important for problem gambling and less important for problem eating.)
I've always felt that the hardcore heavy consumers would do so anyway regardless of the level of advertising.
The people with the worst problems might find a way to blow their money. After all, what difference does it make if you go broke after a yearly trip to LV or steadily in the year? That said, at least a few people will stumble into an addiction they didn't know they had.
If we're only concerned about problem gamblers then that's what I think the shape of the issue is. But if we think regular joes blowing money at fingertip casinos is also a problem, then we have to acknowledge that the advertising must be working or they wouldn't do it. It kind of reminds me of how a former co-worker who worked at TDAmeritrade told me that they were "essentially a marketing company"
Yes they would still consume a lot but they would not consume as much. I drink more in Europe than I do stateside because I can go to bars here. Legality matters.
That comment was limited only to advertising.
Having watched the movie "Dumb Money" I'm having a little bit of difficulty separating the evils of sports betting from the unalloyed goodness of the stock market. Yes, it provides market information, rewards/punishes firms yadda yadda yadda. But doesn't it have something of the same problem of incentivizing the behavior of betting addicts?
Do people say the stock market is *unalloyed* good? I thought the usual economist view is that it’s extremely good, but doesn’t rule out the possibility that there might be a bit of bad alloyed in there.
Good point. Since alloys can be good (shoutout to the Bronze Age), it's fair to call it an "alloyed good."
Congrats of your first piece, Ben!
As a parent, I would love help from the government and/or from other societal institutions in keeping my kids away from gambling, porn, drugs, etc. But Americans tend to chafe at being told what to do (Covid rules, abortion restrictions, etc.). How to thread the needle?
Getting people to see these restrictions as ones they choose themself would be great. Mark Kleiman had a proposal for marijuana legalization - by default, everyone should have a limit on their monthly marijuana purchases, and it should be possible to change your own limit to whatever you want, but increases to that limit would not take effect until the month after next. Enabling people to delay the effects of their actions would enable them to use their own long term thinking to control their short term compulsion.