The paradox of betting machines

At a popular Kenyan joint in Kigali where players routinely bet “a beer’s worth” against each other to a game of pool, a “serious” argument once broke out about the gambling habit with a wink at the seemly irrepressible die-hards who rarely miss at the pool table. Other than for the entertainment value and winding down from work over a friendly tipple, consensus from the argument was that the betting was “a man thing – putting your money where your mouth is.” This may have been in jest among complacent middle-class patrons, but elsewhere in Rwanda gambling was stumping its mark as a social problem. In July this year the Ministry of Trade and Industry temporarily suspended the use of slot machines following public outcry. Callers-in were flooding rural radio stations with complaints the “machines were breaking families apart.” (see “Government suspends betting machines”, The New Times, July 27, 2016). The suspension did not touch casinos, lotteries, sport betting and internet gaming. These forms of gambling are mostly found in the larger urban centres, especially in Kigali. But the government edict was unequivocal where the socioeconomic impact of gambling lies, given that the slot machines are mainly found in the countryside where the majority of the low-income segment resides. Yet the assumption does not describe a peculiarly Rwandan situation. Across the world, betting is disproportionately by people from low income backgrounds among other disadvantaged segments of society, and is reinforced by perception of their economic situation. A 2008 study published in the Journal of Behavioral Decision Making examined how this perception of economic status can play a role in the decision to bet. The study, carried out in the US, divided respondents with an average income of less than $30,000 into two groups and asked them how much money they made. One group was asked to indicate whether they earned “less than $10,000, less than $20,000, or less than $30,000.” The other group’s questionnaire was designed to make them feel poor by asking whether they earned “less than $100,000,” “less than $200,000,” and “less than $300,000.” After completing the questionnaires, all the participants were offered $5 and asked if they wanted to use any of the money to buy lottery tickets. Those who had been made to feel poor bought twice as many lottery tickets as those in the control group. What this shows is that betting is often aspirational, with our proclivity to gamble being psychologically ingrained in the hope and dreams of a better circumstance. Indeed, other studies affirm the thesis that evolution has condemned us to our fate as irrational gambling beings. For instance, we are shown the winner on TV, but not the million losers in a lottery – the odds in this case being one chance in a million. From an evolutionary standpoint, according to behavioral scientists, people just aren’t able to grasp the odds. Scientists observe that “the ability to distinguish between a region with a 1 per cent or 10 per cent chance of being attacked by a predator wouldn’t have offered much of an advantage. An intuitive and coarse method of categorisation, such as ‘doesn’t happen,’ ‘happen sometimes,’ ‘happens most of the time,’ ‘always happens,’ would have sufficed.” In other words, our brains didn’t evolve to calculate complex odds. Thus, seeing a number of winners in promotional offers and lotteries in the media gives us an urge to play the lotto because winners “always happen” as portrayed on TV. Thus the keenness of governments everywhere to regulate gambling and check exploitation, even as they collect taxes. And though it is true that, like any addiction, too much gambling can be a vice, there admittedly also is a silver lining: If spending the equivalent of a dollar or less can afford some hope, however irrational and infinitesimal the probability of winning the jackpot, it is in the thrill of the dream of the possibilities that many bet. In this hope and thrill lies some of the utility value in betting, something not unlike the entertainment derived by the pool players at the Kenyan joint in Kigali.

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The paradox of betting machines