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The effect of online gambling on gambling problems and resulting economic health costs in Germany

The European Journal of Health Economics volume 19, pages 967–978 (2018)Cite this article

Abstract

Problematic and pathological gambling have emerged as substantial problems in many countries. One potential accelerating factor for this phenomenon during recent years is the Internet, which offers different kinds of games and online applications for gambling that are faster, more attractive due to a variety of design and marketing options, less costly and potentially more addictive than terrestrial gambling opportunities. However, the contributing role of the Internet for problematic gambling has not been analyzed sufficiently so far and remains inconclusive. The current study is based on a representative sample with 15,023 individuals from Germany. With a new concept of assessing online gambling with its relative fraction of total gambling activities and a control-function approach to account for possible endogeneity of online gambling, we estimate the impact of online gambling on gambling behavior while additionally controlling for a rich set of important covariates, like education, employment situation and family status. The results show that, on average, replacing 10% of offline gambling with online gambling increases the likelihood of being a problematic gambler by 8.8–12.6%. This increase is equivalent to 139,322 problematic gamblers and 27.24 million € per year of additional expenditures in the German health sector. Our findings underpin the necessity to keep online gambling restricted to prevent further developments of problematic and pathological gambling in Germany.

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Notes

  1. The item asked “by how many cell-phone numbers can you be reached?”.

  2. The F-statistic relates the explained variance of the full model with the explained variance of the “null model”. As a rule of thumb, a value higher than 10 is associated with strong instruments. Every model’s first stage results displayed an F-statistic larger than 10. First stage results available upon request.

  3. See http://www.wsj.com/articles/SB10001424052702304432604579475303715000912.

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Author information

Affiliations

  1. Hamburg Business School, University of Hamburg, Max Brauer Allee 60, 22765, Hamburg, Germany

    Tobias Effertz

  2. Department of Psychiatry and Psychotherapy, University of Lübeck, Ratzeburger Allee 160, 23538, Lübeck, Germany

    Anja Bischof & Hans-Jürgen Rumpf

  3. Institute of Social Medicine and Prevention, University Medicine Greifswald, Walther-Rathenau-Straße 48, 17475, Greifswald, Germany

    Christian Meyer & Ulrich John

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  1. Tobias Effertz
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  2. Anja Bischof
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  3. Hans-Jürgen Rumpf
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  4. Christian Meyer
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  5. Ulrich John
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Correspondence to Tobias Effertz.

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Effertz, T., Bischof, A., Rumpf, HJ. et al. The effect of online gambling on gambling problems and resulting economic health costs in Germany. Eur J Health Econ 19, 967–978 (2018). https://doi.org/10.1007/s10198-017-0945-z

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  • DOI: https://doi.org/10.1007/s10198-017-0945-z

Keywords

  • Online gambling
  • Medical costs of gambling
  • Germany
  • PAGE-study
  • Gambling prevalence

JEL Classification

  • I10
  • I12
  • L83