Gambling and Cheating

Curious consequences of reasonable beliefs

Many people are opposed to players throwing games, and also opposed to sports gambling. Should you be? Are these consistent?

Suppose you are an opponent of sports gambling. There are many reasons why you might oppose it, but let’s say that you oppose it because it leads to rubes losing their money, and people going bankrupt and being unable to provide for their spouse and families. You would like gambling to be advertised less, and would like at least to decrease its availability. This is not a religious crusade against gambling – you have no issue with people doing it responsibly, and would not want to outlaw bracket pools and friendly games of poker – but, there are values of social spillovers which would lead you to want to ban gambling entirely.

Now suppose that you hear about insider trading in the sports betting market. A player knew that they would be injured, and leaked it to their friends – as in the recent case of Terry Rozier – or worse still, someone was paid to throw a game entirely, as with the Chicago Black Sox of 1919. Your first reaction is doubtless that of horror – a fraud has been perpetrated on the public, and must be stopped. The players involved should be banned from baseball forever! But is this consistent? Should you want this?