Social Capital and Gambling: Evidence from Australia

Abstract

The prevalence of problem gambling in many countries necessitates research that examines factors influencing excessive and addictive consumption. We consider how social capital impacts gambling participation for a large representative sample of the Australian population. Specifically, we examine the association between social capital and gambling addiction using data from the Household, Income and Labour Dynamics in Australia survey. We address the endogeneity of social capital by instrumenting for social capital using an urban/rural reversed measure of ethnic diversity. Our main findings suggest that higher levels of social capital are associated with lower gambling risks measured by the Problem Gambling Severity Index. This general finding is robust to alternative ways of measuring social capital and gambling, and alternative estimation approaches. We also find that the effect of social capital is stronger in the case of problem gamblers compared to gamblers in other risk categories.

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Notes

  1. 1.

    http://natcen.ac.uk/our-research/research/british-gambling-prevalence-survey/.

  2. 2.

    Our focus on waves 6 to 14 for the second and third measures of social capital is to ensure that the first year of data corresponds with the first wave in which the social capital modules were introduced for the first measure of social capital. Further, it allows us to appropriately instrument for social capital, which we discuss in the next section.

  3. 3.

    \(FRACTIONALIZATION_{J} = 1 - \sum\nolimits_{e = 1}^{N} {S_{eJ}^{2} }\), where \(s_{ej}\) is the share of ethnic group \(e\) in neighbourhood (postcode) \(j\).

  4. 4.

    Using country of birth of respondents’ father rather than respondents’ country of birth allows us to capture ‘ethnicities’ of respondents who were born to first generation migrants in Australia.

  5. 5.

    See Lewbel (2012) for details on how identification is achieved.

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Correspondence to Sefa Awaworyi Churchill.

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Awaworyi Churchill declares that he has no conflict of interest. Farrell declares that she has no conflict of interest.

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This paper uses unit record data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey. The HILDA Project was initiated and is funded by the Australian Government Department of Social Services (DSS) and is managed by the Melbourne Institute of Applied Economic and Social Research (Melbourne Institute). The findings and views reported in this paper, however, are those of the authors and should not be attributed to either DSS or the Melbourne Institute. (Melbourne Institute). The findings and views reported in this paper, however, are those of the authors and should not be attributed to either DSS or the Melbourne Institute.

Appendix

Appendix

See Tables 7, 8, 9, 10 and 11.

Table 7 Items used in the Problem Gambling Severity Index
Table 8 Items used in the Social Capital 1 Composite Scale
Table 9 Items used in the Social Capital 2 Composite Scale
Table 10 Items used in the Social Capital 3 Composite Scale
Table 11 Description and summary statistics of variables

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Awaworyi Churchill, S., Farrell, L. Social Capital and Gambling: Evidence from Australia. J Gambl Stud 36, 1161–1181 (2020). https://doi.org/10.1007/s10899-019-09901-9

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Keywords

  • Gambling
  • PGSI
  • Social capital
  • Social cohesion