eBusiness Weekly
Two approaches are most commonly adopted to measure the effect of gambling. The first is a cost-benefit analysis, the second an economic-impact analysis.
Both approaches seek to determine the net benefits of gambling activity but they do it in different ways. A cost-benefit analysis considers the economic efficiency of gambling activity by seeking to determine all the individual costs and monetary benefits of various aspects of the activity. This type of analysis compares the costs and benefits that result from gambling.
On the other hand, an economic-impact analysis uses “multiplier effects” to determine the compound impact of gambling on economic activity including on jobs, income, operating costs, productivity and competitiveness. This type of analysis attempts to measure the net positive economic effects of gambling including any ripple effect that gambling may have on the economy.
Unfortunately, both approaches are flawed.
A cost-benefit analysis is flawed because it attempts to consider economic efficiency by quantifying aspects like stress, mental anguish, and entertainment, which are immensely difficult to value.
And economic-impact analyses fail because they pay scant attention to the real private and social costs of gambling.
This leads to conclusions that often amplify the benefits of gambling while downplaying the costs.
Perhaps the best way to determine the benefits of a gambling-free society is through the public health approach. A public health perspective allows researchers to consider the economic and social consequences of the industry.
From this perspective it’s clear that there’s a need for action. Laws prohibiting underage gambling should be rigorously enforced. But laws aren’t enough. Strategies to increase education and public awareness about problem gambling are vital.
Collaboration is needed so that social policies and effective public health intervention options can be developed. – The Conversation
