Gambling Culture Research Articles

Does provincial gambling culture affect corporate innovation? Evidence from China

We examine the impact of provincial gambling culture on the local firms’ R&D expenditure. We find that local gambling culture, measured by the regional lottery sales revenue per capita, promotes local firms’ R&D expenditure. Further tests show that provincial gambling culture produces more innovation outcomes and results in high innovation quality in the long run. Our result is robust to endogeneity corrections using the instrumental variable and PSM-DiD approaches and controlling for firm fixed effects. The mechanism tests reveal that our main finding works through two channels to increase local firms’ risk-taking: hiring young CEOs and using more equity. In addition, we rule out the impact of neighbouring regional gambling culture on the local firms’ R&D investments by using geographic RDD analysis. Finally, our results are more pronounced for firms in provinces with high levels of social trustworthiness, more young ageing populations, and non-SOEs.

Deviance, Discourses, and Everyday Rationalities of Sports Betting in Singapore

ABSTRACTMore liberal regulations and technological advances have spurred the growth of sports betting around the world. Given its long‐standing association with various social ills, how do sports bettors justify their gambling activities? This paper looks into the guiding principles and everyday practices of sports betting participants in Singapore. Based on qualitative research, it argues that sports bettors distinguish their activities by following a distinctive rationality that we call “benevolent play.” This concept refers to gambling practices where goodwill and charity serve as a justification for the potential of losing their bets and for their continued participation in sports betting. Apart from latching on the use of regulated gambling by state‐affiliated agencies to support development programs and charitable causes, benevolent play also emphasizes the sense of agency (football knowledge) and emotional investment (“play”) that sports bettors wage on their teams and communities. Generally, this study will contribute to the understanding of gambling culture and the larger discussions on deviance and social control.

The effect of gambling culture on initial public offering underpricing

We examine the effect of gambling culture where an IPO firm is located on its IPO underpricing. Our findings suggest that an IPO firm in a strong gambling culture region, on average, operates more aggressively than one in a weak gambling culture region. Then, we show that such IPOs exhibit lower underpricing than their counterparts. The findings remain qualitatively the same after an array of robustness checks. We interpret the results as indicating that IPO investors consider aggressively operated IPO firms to have good upside potential and are willing to pay higher subscription prices for these IPOs.

Cultural Barriers to Digital Innovation: Understanding the Impact of Gambling Culture on Chinese Firms

Cultural Barriers to Digital Innovation: Understanding the Impact of Gambling Culture on Chinese Firms

Betting on success: Unveiling the role of local gambling culture in equity crowdfunding

This study explores how local gambling culture, as measured by state-level religious composition, influences equity crowdfunding success. Our research uncovers a positive relationship between local gambling culture and equity crowdfunding success, driven by the state's innovation propensity. We also shed light on the positive effect of local gambling culture on firms’ document amendment behaviors, influenced by state regulation restrictions. Further analyses indicate that firms’ ownership structure moderates the positive relationships between local gambling culture and both equity crowdfunding success and document amendment behaviors. Our study centers on equity crowdfunding, demonstrating the important role of local gambling culture in determining entrepreneurial fundraising outcomes.

Gambling culture, corporate risk preference and bond risk premium

Gambling culture, corporate risk preference and bond risk premium

Social media attention and corporate greenwashing: Evidence from China

AbstractThis study examines the effect of social media attention on corporate greenwashing using a sample of Chinese A‐share listed firms from 2011 to 2021. We find that social media attention increases corporate greenwashing, and the effect is more pronounced for firms with negative financial performance and those with violations, supporting the pressure hypothesis. Drawing on fraud triangle theory, which considers the interplay of pressure, opportunity, and rationalization, we also find that the pressure effect is more pronounced for firms with higher CEO power, greater information asymmetry, as well as firms located in regions with a gambling culture and non‐state‐owned firms. This indicates that firms are more inclined to greenwash when they perceive an opportunity and can rationalize this behavior. Furthermore, our heterogeneity analyses demonstrate that the pressure effect is more significant for firms located in regions characterized by higher marketization, firms operating in non‐heavily polluting industries, and those that do not provide assured non‐financial reports. This study contributes to the literature on the role of social media and determinants of corporate greenwashing, providing important implications for firms' sustainable development.

Does regional gambling culture affect long-term corporate operational risk?–Empirical evidence from lottery sales

The findings of this paper indicate that regional gambling culture can increase the long-term performance volatility of enterprises. The results of heterogeneity tests show that the impact of regional gambling culture on the long-term performance volatility of enterprises is more pronounced in companies with higher information asymmetry and those in regions with lower levels of marketization. This discovery of variability offers targeted suggestions for enterprises to formulate cultural industry development strategies under different economic backgrounds and industry characteristics, providing practical guidance for policymakers and corporate managers.

Local Gambling Culture and Enterprise Bribery: A Social Norms Theory Perspective

Abstract Based on social norms theory, we examine the impact of local gambling culture, an unexpected result of government-permitted lotteries, on enterprise bribery. We propose that local gambling cultures can promote active enterprise involvement in bribery activities by reinforcing the speculative psychology of enterprise decision-makers. In addition, we argue that local gambling culture is less likely to lead female (returnee) chairpersons to develop speculative psychology than male (nonreturnee) chairpersons. This, in turn, allows female (returnee) chairpersons to undermine the positive impact of local gambling culture on involvement in enterprise bribery. Based on 11 years of empirical data obtained from privately listed Chinese companies (including 2,637 listed companies with 15,036 firm-year data points), we obtain empirical evidence to support most of these views. This study is the first to explore the relationship between local gambling culture and enterprise bribery, and important insights are provided for shareholders and policy-makers to better curb enterprise bribery.

Are optimistic CEOs and pessimistic CFOs the best partners? Evidence from corporate cash holdings

Based on the perspective of corporate cash holdings, this paper explores whether the combination of an optimistic CEO and a pessimistic CFO creates the “best partners”. Taking the non-financial A-share listed firms in China from 2010 to 2018 as the sample, ordinary least squares (OLS) regression analysis was used as the baseline approach to empirically test, for the first time, the comprehensive influence of CEO optimism and CFO pessimism on corporate cash holdings. The empirical results show that firms with an optimistic CEO and a pessimistic CFO will hold less cash. Moreover, this negative compound effect is found to be more significant in regions with a strong gambling culture and in non-state-owned enterprises (non-SOEs). Further analysis reveals that whether the CFO sits on the board of directors and the educational level difference between the CEO and CFO are also essential factors restricting this negative compound effect. This study provides a new perspective for relevant research on upper echelons theory, and also enriches relevant research on the factors influencing corporate cash holdings.

Gambling culture and internal control extensiveness

AbstractWhile cultural traits in a firm's location impact corporate operation, the role of local cultures on a firm's internal control effectiveness (ICE) remains unclear. Using data from a sample of Chinese firms from 2009 to 2019, we examine how the gambling culture in Chinese provinces where firms are located impacts the firms' ICE. We use per capita lottery sales of the provinces to proxy for gambling culture in China and find that firms raise their ICE in environments with strong gambling cultures. The results are robust to five components of ICE (control environment, risk assessment, control activity, information and communication, and internal monitoring), alternative metrics of gambling metrics, and after accounting for endogeneity. A mediating analysis also shows that firms in regions with a strong gambling culture engage in risky activities, which increases their ICE. Additional analyses suggest that the effect is more salient for firms with poor internal corporate governance, firms located in poor legal environments, firms with poor audit quality, or firms with more local external stakeholders, echoing that ICE and monitoring are partial substitutes.

Gambling culture and corporate violations: Evidence from China

This study investigates whether local gambling cultures in China affect corporate violations for 31,670 firm-year observations over the period 2008–2020. The ratio of provincial lottery sales to GDP is used as a proxy for gambling culture. We find that companies headquartered in areas with a strong gambling culture have a higher likelihood of violations than those headquartered in areas with a weak gambling culture. This conclusion is robust to a series of endogeneity tests using instrumental variables and propensity score matching approaches. In addition, manager characteristics and external monitoring affect the positive relationship between gambling culture and corporate violations. Furthermore, we also identify two channels through which gambling culture affects corporate violations: accounting conservatism and geographic diversification of investments. Finally, we find that the Chinese government's efforts to crack down on illegal gambling reduce corporate violations. Overall, our findings provide empirical evidence that gambling culture facilitates corporate violations.

Do chairmen with China's Great Famine experience in early‐life affect firm tax avoidance activities?

AbstractThis article investigates whether and how chairmen with China's Great Famine experience affect firm tax avoidance activities. We find that the chairmen who experienced China's Great Famine in early‐life engage in fewer tax avoidance activities than other chairmen. This effect is stronger for firms in regions with a weak gambling culture and provinces with higher political uncertainty, nonstate‐owned firms, and chairmen with higher education. We show that a lower‐level risk appetite among chairmen is the primary mechanism driving lower tax avoidance in their firms. Our article provides new insights into the differences in tax avoidance between firms based on whether managers experienced the Great Famine.

Gambling culture and earnings management: A novel perspective

Do gambling preferences affect earnings management in a corporate context? We examine this potential link and find a positive and significant association between local gambling culture, as proxied by faith and firm-level earnings management. The results are robust to potential endogeneity tested through relocation of corporate headquarters and change regressions. We also show that the impact of local gambling preferences on earnings management is stronger when firms are more risk-taking as proxied by higher earnings volatility. Further, this positive association between gambling preferences and earnings management is mitigated by closer monitoring through institutional investors and takeover threats.

Gambling culture and corporate financialization: Evidence from China's welfare lottery sales

Our study sheds new light on the determinants of firms' financial investment behavior from the perspective of local gambling culture. Using data on Chinese non-financial listed firms from 2008 to 2019, we find that firms in regions with a stronger gambling culture hold more financial assets. Furthermore, our analysis reveals that managers' risk-taking and local investors' risk preference are two possible channels through which the gambling culture to influence firms' financialization decisions. In addition, we find that the impact of gambling culture on financialization is more substantial among non-state-owned enterprises, among firms located in provinces with high marketization, and when the economic policy uncertainty is larger.

Greyhounds in a Sin City: Animal Welfare under Macao's Gambling Culture

For a few years in the 1930s and then for another fifty-five years since 1963, greyhound racing was one of the attractions that helped boost Macau's repertoire as the Monte Carlo of the East. Adopting the Marxist framework of commodification of non-human animals, this study explores the shaping of human-animal interaction in the context of a gambling city. I argue that the cultural assigning of greyhound puppies to the purpose of dog racing not only resulted in the construction of a general understanding of greyhounds as objects that could only belong to a canidrome, but also tied their lives to the fluctuating dynamics of the city's gambling sector. Ultimately, this study calls for a reappraisal of the ways we have tied non-humans with labels such as ‘racers’ or ‘rescues’ and the place of non-human animals in the city beyond the framework of capitalism.

Local gambling culture and corporate tax aggressiveness: A trait activation perspective on informal institutions

AbstractBased on the theory of new institutionalism and trait activation, we empirically evaluated the role of gambling culture on aggressive corporate taxation. A positive association was found between gambling culture and tax aggressiveness, the gambling culture increased the risk preferences of firm executives. The relationship was more pronounced in non‐state‐owned firms, firms with a high proportion of male executives, shortsighted executives, local CEOs, and those located in areas with less intense tax regulation and lower levels of Islamic faith. The findings enrich studies investigating the economic consequences of gambling culture and provide innovative ideas for external regulators to formulate anti‐avoidance measures.

The Impact of Gambling Culture on Entity Financialization

Culture is an important factor that affects the investment behavior of enterprises, while gambling culture to a certain extent reflects people’s risk-taking spirit or speculative preferences. Taking Chinese A-share listed companies from 2008 to 2020 as a sample, we ran industry and year effect regressions to test the impact of gambling culture on corporate financialization from the perspective of speculative culture. Gambling culture is measured by regional per capita lottery consumption. The results show that a gambling culture plays a significant role in promoting the share of financial assets held by local enterprises. Economically speaking, every CNY 1000 increase in per capita lottery sales will lead to a 3% increase in the share of financial assets held by local enterprises. It is verified that a gambling culture affects corporate financial asset investment by enhancing management’s overconfidence level. In addition, by subdividing financial assets, we find that a gambling culture mainly increases holdings of profit-driven financial assets. Heterogeneity tests show that economic policy uncertainty, corporate performance pressure, and attribution of corporate property rights play a moderating role in the relationship between gambling culture and corporate financial asset investment. The conclusions of this paper help enrich the study of the economic consequences of gambling culture for micro-enterprises and broaden the understanding of financialization from a cultural perspective.

Predictors of adverse gambling behaviours amongst elite athletes

Problem gambling levels amongst elite sportspeople are above populational baseline. We assess gambling in an elite Irish sporting population. An anonymous web-based questionnaire including the validated Problem Gambling Severity Index was distributed. Univariate and multivariate analyses were performed to evaluate predictors of moderate/high risk gambling. 608 players (mean age 24) were included. Seventy nine percent of respondents were current gamblers and 6% problem gamblers. Amongst high-risk gamblers, significantly more were male (100% vs 76%, p = 0.003), fewer completed university (52% vs 69%, p = 0.024), and more were smokers (48% vs 24%, p = 0.002). They were also more likely to avail of free online gambling offers (90% vs 44%, p < 0.001), gamble with teammates (52% vs 21%, p < 0.001) and have placed their first bet before age 16 (41% vs 19%, p = 0.003). In multivariate analysis, moderate/high risk gambling was associated with: male gender (OR = 8.9 [1.1–69], p = 0.035), no 3rd level education (OR = 2.5 [1.4–5.0], p = 0.002), free online gambling use (OR = 4.3 [2.1–5.3], p < 0.001), gambling with teammates (OR = 3.0 [1.7–5.3], p < 0.001), and being under 18 at first bet (OR = 2.0 [1.1–3.3], p = 0.013). This study shows a harmful gambling culture amongst elite Irish athletes. Male gender, lower educational status, free online gambling use, gambling with teammates and first bet at less than age 18 were associated with moderate/high risk gambling. These groups may benefit from targeted interventions.

Unpacking the root causes of gambling in the Asian community: Contesting the myth of the Asian gambling culture.

Problem gambling is a public health issue both in the United States and internationally and can lead to mental health and socioeconomic concerns for individuals, families, and communities. Large epidemiological studies on problem gambling have neglected to include working-class, immigrant Asian Americans, who are at higher risk for problem gambling. The lack of data on Asian American gambling may explain a subsequent lack of culturally and linguistically appropriate treatment and prevention services. Additionally, the invisibility of Asian American data in published literature has helped to perpetuate a commonly held myth of an Asian gambling culture. This stereotype of the "Asian gambler" is a form of anti-Asian racism which serves to ignore and minimize the root causes of problem gambling in the Asian American community. Utilizing a community-based participatory research approach, 40 interviews were conducted with the local Khmer (n = 12), Chinese (n = 20), Korean (n = 3), and Vietnamese (n = 5) immigrant communities in the Greater Boston region to assess how problem gambling manifests in the local Asian community. Interviews were conducted in language by bilingual/bicultural community fieldworkers experienced in serving their respective communities. Flyers and social media were used to recruit participants. The interviews were coded into themes which provided a better understanding of the patterns of systemic issues contributing to problem gambling in the Asian American community. Interviewees provided insights into the underlying issues of poverty and social and cultural loss due to immigration as root causes for problem gambling in the Asian American community. The interviews indicate that many individuals in these Asian immigrant communities, who are striving to make a living off low-wage and stressful jobs, struggle to integrate into American society. They often lack culturally appropriate and accessible social and recreational activities, a void that casinos capitalize on through targeted behaviors. Research must address the social and structural barriers in the Asian American communities rather than relying on the "Asian gambler" stereotype and assuming interventions for a general American problem gambler will work for Asian immigrants. The research points to a need for gambling interventions and services that are centered on lived experiences.