Does Size Really Matter? A Review of the Role of Stake and Prize Levels in Relation to Gambling-Related Harm

Abstract

Regulatory and industry decisions influencing commercial gambling activities require clear understanding of the role that stakes and prizes play in the development and facilitation of gambling-related harm. Although industry proponents argue for increases in stakes and prizes to meet market demands, regulators remain cautious about the potential implication for gambling-related harm, while industry opponents generally condemn relaxing aspects of gambling policies. To inform this debate, this paper provides a critical examination of the relevant literature. From the review, it is concluded that limitations of the existing literature restrict our ability to draw definitive conclusions regarding the effects of stake and prize variables. Most studies contain multiple, methodological limitations, the most significant of which are diluted risk and reward scenarios used in analogue research settings not reflective of real gambling situations. In addition, there is a lack of conceptual clarity regarding many constructs, particularly the parameters defining jackpots, and the interactive nature and effect of the differing configurations of game parameters and environments are often not taken into consideration when investigating changes to one or more variables. Notwithstanding these limitations, there is sufficient evidence to suggest that stake and prize levels merit consideration in relation to harm minimisation efforts. However, substantial knowledge gaps currently exist, particularly in relation to understanding staking and prize thresholds for risky behaviour, how the impact of stakes and prizes change depending on the configuration and interaction of other game characteristics, and the role of individual and situational determinants. Based on the potential risk factors and the implications for commercial appeal, a player-focussed harm minimisation response may hold the most promise for future research and evaluation in jurisdictions where gambling is a legal and legitimate leisure activity.

Over and under commitment to a course of action in decisions from experience.

“…While sunk costs are usually present when people exhibit problematic gambling behaviors (e.g., Fantino et al, 2005;Griffiths & Wood, 2001), our results suggest they are not necessarily the root cause for such behaviors. Instead, our findings emphasize the importance of a high frequency of small reward in escalating different gambling choices (see also Dixon et al, 2006;Griffiths, 1999;Haruvy et al, 2001;Parke & Parke, 2013 for similar observation).…”

Setting Limits: Gambling, Science and Public Policy—summary of results

“…In contrast, some gambling providers, such as the French national lottery, justify their low return percentages, or in other words the high price of participation, as a harm reduction strategy [72]. Research remains inconclusive regarding whether high return levels encourage problem gambling or not [73, 74].…”

Gambling-like Features in fan Tokens

“…The gamified experience also includes other lower value rewards such as discounts on merchandising and being able to participate in binding pools (i.e., pools whose results must be respected by the team) which are fixed rewards. From the analyses performed on the app and other documentation the reward volatility could not be estimated (i.e., more volatility means less frequent but higher value wins; Parke & Parke 2013 ).…”