Published by Grant Blank on 12 December 2011

Regardless of whether internet gambling is illegal (in the US) or legal (Europe), it requires trust. In bricks-and-mortar casinos the long-run odds favour the house, so there is a built-in probability of losing. Online there is no way to see physical playing cards or dice or any physical roulette wheel. So how does any gambler know that the house is playing fair? Online gamblers could be setting themselves up for an even greater likelihood of losing. Consider, also, the incentives for the online gambling sites: even a small shift in the odds would make a considerable difference in the casino’s income. Since there are almost no marginal costs it would lead directly to a congenial, happy increase in profit. These issues suggest that more trust is required for online gambling than for face-to-face gambling.

But is this true? We can test the hypothesis with OxIS questions about gambling and about trust. The data are in the graph below. The graph splits users into gamblers and non-gamblers. One message is that most people never gamble; over 87% report never betting, gambling or entering sweepstakes online. Only 14 users (about 1%) report daily gambling. Trust online is a five-category Likert scale ranging from “No trust at all” to “Total trust”. The graph plots the percentage of users by gambling versus not gambling. 17% of respondents at the extreme trust end, “Total trust”, report gambling compared to 11% of those who have “No trust at all”. The different is six percentage points. This confirms the hypothesis that gamblers are more likely to trust people online than non-gamblers.