A new study by economist Prof. DDr. Friedrich SCHNEIDER of the Johannes Kepler University Linz deals with the question of whether the Austrian gambling monopoly, which is regularly justified on the grounds of player protection or the associated social costs, is still justified from an economic point of view. In his study, Prof. Schneider comes to the unequivocal conclusion that the monopoly is neither in conformity with the market nor proportionate, as it cannot be justified either on the basis of market failure or player protection.
The study further points out that state monopolies are now obsolete in today’s market-based social order. This view of economic science underlines the argument of the OVWG that the Austrian gambling monopoly is no longer up to date and that a corresponding reform of the now 33-year-old Gambling Act is urgently needed.
“In the logic of economics, the establishment of a state monopoly presupposes a market failure to be corrected (e.g. high costs to society) and therefore a monopoly should be a last resort.”
The social costs of gambling addiction in Austria for society are, however, measured in terms of Austria’s economic performance in the low per mille range and, for example, many times lower than those of smoking or alcohol consumption: Thus, there is no market failure that would justify such an intervention by the state in the form of a monopoly, Prof. Schneider concludes.
The study was presented by Prof. Schneider at a press conference in Vienna on 17.5.2022, a video of this presentation is available:
Long version of the presentation (german, 25:05 min), Highlights (german, 2:45 min)