Discounting Behavior in Problem Gambling

19 Pages Posted: 15 May 2020

See all articles by Patrick Ring

Patrick Ring

Kiel Institute for the World Economy

Catharina Probst

University of Kiel

Levent Neyse

German Institute for Economic Research (DIW Berlin)

Stephan Wolff

Kiel University

Christian Kaernbach

University of Kiel

Thilo van Eimeren

University Hospital of Cologne

Ulrich Schmidt

Kiel Institute for the World Economy

Date Written: April 20, 2020

Abstract

Problem gamblers discount delayed rewards more rapidly than do non-gambling controls. Understanding this impulsivity is important for developing treatment options. In this article, we seek to make two contributions: First, we ask which of the currently debated economic models of inter-temporal choice (exponential vs. hyperbolic vs. quasi-hyperbolic) provides the best description of gamblers' discounting behavior. Second, we ask how problem gamblers differ from habitual gamblers and non-gambling controls within the most favored parametrization. Our analysis reveals that the quasi-hyperbolic discounting model is strongly favored over the other two parameterizations. Within the quasi-hyperbolic discounting model, problem gamblers have both a significantly stronger present bias and a smaller long-run discount factor, which suggests that gamblers' impulsivity has two distinct sources.

JEL Classification: C91, D87

Suggested Citation

Ring, Patrick and Probst, Catharina and Neyse, Levent and Wolff, Stephan and Kaernbach, Christian and van Eimeren, Thilo and Schmidt, Ulrich, Discounting Behavior in Problem Gambling (April 20, 2020). Available at SSRN: https://ssrn.com/abstract=3577426 or http://dx.doi.org/10.2139/ssrn.3577426

Patrick Ring (Contact Author)

Kiel Institute for the World Economy ( email )

Kiellinie 66
Kiel, Schleswig-Holstein 24105
Germany

Catharina Probst

University of Kiel ( email )

Olshausenstr. 40
D-24118 Kiel, Schleswig-Holstein 24118
Germany

Levent Neyse

German Institute for Economic Research (DIW Berlin) ( email )

Mohrenstra├če 58
Berlin, 10117
Germany

Stephan Wolff

Kiel University ( email )

Christian Kaernbach

University of Kiel ( email )

Olshausenstr. 40
D-24118 Kiel, Schleswig-Holstein 24118
Germany

Thilo Van Eimeren

University Hospital of Cologne ( email )

Building 47, 9th floor Kerpener Str.
Herderstrasse 52
Cologne, 50931
Germany

Ulrich Schmidt

Kiel Institute for the World Economy ( email )

P.O. Box 4309
Kiel, Schleswig-Hosltein D-24100
Germany

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