As online sports betting spreads across the U.S., new research suggests the cost to many households may go far beyond what they wager.
A study led by University of Nebraska–Lincoln assistant professor of finance Justin Balthrop found that legalized online sports betting can cause households to cut back on savings and investments, potentially undermining long-term financial security. “Online sports betting does more than compete for consumers’ entertainment dollars,” Balthrop said. “It can lead to spending money they planned to invest, particularly among those already facing financial constraints.”
The findings were published recently in the Journal of Financial Economics in a paper titled “Gambling Away Stability: Sports Betting’s Impact on Vulnerable Households.” The study analyzed financial transactions from 183,821 U.S. households and examined how investing, spending and debt management changed after online sports betting became legal in 26 states.
