Grade Booster student workshops are back in cinemas for 2022. Learn more

Economics

In the News

Government intervention: Could new legislation change UK betting firms for good?

Ollie Gardner

1st February 2021

The government's review of UK gambling laws could cause betting firms serious problems, but also risks worsening market failures already in existence.

If you have ever watched a Premier League football game, you will know that UK betting companies are heavily embedded in the world of sport. Whether it be the Betway logo on West Ham's kit or the vast array of betting adverts at half time, UK gambling's high profile has increased appetite for tougher legislation in the industry to protect vulnerable consumers and young people from falling into a spiral of debt and addiction.

Regulators are said to be pondering the introduction of registration requirements, such as making individuals show proof of their earnings, to increase effort and deter people from signing up to betting companies - the consumer equivalent of higher barriers to entry.

The introduction of limits that may be too harsh, however, such as a £2 cap on bets in games such as roulette, could have unintended consequences by fueling a rise in black market gambling - where there is no regulatory oversight. If new regulation is not thought out properly, this could be a classic case of government failure in which intervention only proves to exacerbate existing market failures - as consumers turn to black markets that are far worse than current UK betting firms.

Ollie Gardner

Ollie is a new economics teacher at an academically selective school having previously worked in the healthcare technology industry.

Boston House,
214 High Street,
Boston Spa,
West Yorkshire,
LS23 6AD

Tel: +44 0844 800 0085

© 2022 Tutor2u Limited. Company Reg no: 04489574. VAT reg no 816865400.