Temperature shocks and gambling

Abstract

Climate change threatens sustainable development by influencing myriad of outcomes. We examine if temperature shocks contribute to the gambling, which is a major public health concern globally. We use longitudinal data from the Household, Income and Labour Dynamics in Australia (HILDA) survey coupled with satellite data capturing neighbourhood temperature shocks. Our results suggest that temperature shocks increase the prevalence of gambling, and that psychological distress and social capital are channels through which temperature shocks transmit to gambling behaviour. Our results point to the need for policies that promote mental health and encourage social capital amidst extreme weather events in order to offset the effects of weather shocks on gambling behaviour.