Gambling and Bankruptcy

Gambling is an activity where people place a bet with the hope of winning money. It can take a variety of forms, such as playing the lottery, poker, roulette, bingo and horse racing. It can be a fun and exciting way to pass the time, but it also has the potential to be addictive and cause financial problems.

Gamblers are typically motivated to gamble for a number of reasons. Some are social – for example, they enjoy being with friends who also gamble. Others are motivated to win money, or because they want to change their lifestyle. Some are just addicted to the rush or feeling of “high” that gambling gives them.

Psychiatrists generally regard pathological gambling as more of a compulsion than an addiction, although it has been moved from the impulse-control disorder chapter of the Diagnostic and Statistical Manual of Mental Disorders (DSM) to the addictions section.

There is a lot of evidence that gambling increases the risk of bankruptcy. In fact, according to published news accounts, bankruptcy court opinions and bankruptcy attorneys, gambling-related bankruptcies account for about 20 percent of all bankruptcies.

Benefit-cost analysis can be used to estimate the net benefits or costs associated with gambling, but these effects are difficult to measure and vary by location, time and gambling venue as well as by type of gambling (e.g., lottery, casinos, riverboat and pari-mutuel gambling).

There are also intangible social costs that may not be readily identifiable. These include emotional pain and other losses experienced by family members of pathological or problem gamblers and lost productivity on the part of employees who are affected by these gambling habits.