A dynamic model of Gambling addiction with social costs: theory and policy solutions

Leonardo Becchetti, Nazaria Solferino and M. Elisabetta Tessitore

MPRA Paper from University Library of Munich, Germany

Abstract: We investigate the effects of gambling addiction in a dynamic model in which wellbeing crucially depends on the accumulation of relational goods which is weakened by the consumption of gambling. We outline conditions under which gambling may become addictive leading to a suboptimal equilibrium from a social point of view. We examine the relative effectiveness of different policy solutions (tax on gambling, gambling restrictions) in bridging the distance between the equilibrium without intervention and social optimum.

Keywords: addiction; gambling; social costs (search for similar items in EconPapers)
JEL-codes: D10 I18 (search for similar items in EconPapers)
Date: 2016-02-25
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Related works:
Working Paper: A dynamic model of Gambling addiction with social costs: theory and policy solutions (2014)
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