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Gamblers, scratchers and their financial education

Author

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  • Becchetti, Leonardo

    (Associazione Italiana per la Cultura della Cooperazione e del Non Profit)

  • Bellucci, Davide

    (Associazione Italiana per la Cultura della Cooperazione e del Non Profit)

  • Rossetti, Fiammetta

    (Associazione Italiana per la Cultura della Cooperazione e del Non Profit)

Abstract

We develop an online survey to investigate the characteristics of slot/videopoker players and scratchers (individuals buying tickets of scratch-off lotteries). We find evidence of a negative relationship between gambling and financial literacy. More specifically, after controlling for gender, education, income, employment status and area of residence: i) slot and/or videopoker players have a 8 percent lower probability of answering correctly to all the three standard financial education questions; ii) scratch-off players have a 10 percent lower probability of answering correctly to the (third) mutual fund risk diversification question. Scratch-off players are as well more impatient and more likely to sacrifice expected value for positive skewness and they overestimate the probability of winning at least the price of the ticket. Our findings suggest that scratchers and slot/videopoker players may be unable to evaluate the overall consequences of gambling on their economic wellbeing due to their lower financial education.

Suggested Citation

  • Becchetti, Leonardo & Bellucci, Davide & Rossetti, Fiammetta, 2016. "Gamblers, scratchers and their financial education," AICCON Working Papers 153-2016, Associazione Italiana per la Cultura della Cooperazione e del Non Profit.
    • Handle: RePEc:ris:aiccon:2016_153
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    Cited by:

    1. Giuseppe Coco & Daniele Simone & Laura Serlenga & Sabrina Molinaro, 2023. "Risk awareness and complexity in students’ gambling," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 40(3), pages 971-994, October.

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    More about this item

    Keywords

    gambling; scratch-off lotteries; financial education;
    All these keywords.

    JEL classification:

    • A20 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - General
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles
    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions

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