Islamic Economics Institute

Wednesday Academic Dialogue (1)

Chair of Ethics and Financial Norms
Université Paris 1 Panthéon Sorbonne – King Abdulaziz University

1st Seminar

How fair is gambling?  
Assumptions on the gamblers’ cognitive abilities 
are

likely to create bias in favour of the operators

Wednesday 21 September, 2016 (19/12/1437H)

Full Text

Dr. Pierre-Charles Pradier . . (Speakers)
(Université Paris 1 Panthéon-Sorbonne- France) 

Abstract

Since the Middle Ages, when lotteries appeared as a means to fund public utilities, gambling became a last resort to feed the authorities’ auri sacra fames in between prohibitive diets. Economic analysis accounts for the relative benefits of stakeholders: gambling operators, gamblers and public authorities. The usual conclusion is that gambling is good for every one, except problem gamblers, which should be taken care of; but taxation is far higher than negative externalities (such as problem gambling). Excessive taxation means deadweight loss, which should be lowered by cutting taxes. 

A different representation of the gambler would change this prevalent view. Instead of a market with operators and consumers, imagine gambling as it is: players gambling against one another. Gambling now appears as exploitation of less skilled new entrants by returning sharks. Moreover, it can be shown that lowering taxes benefits most entirely to professional gamblers, organized criminals and gambling operators, hence their sustained and priority interest in regulated markets. The moral qualification of games might be reconsidered here, hence the need for a larger (and renewed) perspective on history and anthropology of gambling.


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