Financial stress and gambling motivation: the importance of financial literacy
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Connects with: @bray2001 @breunig2019 @muggleton2021 @oksanen2018 @takeuchi1991 @yates2007
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amonhaemanon2024 - p. 249
tudies in the past have revealed that the more people were facing a low income or unemployment, relying on state welfare, and living in rental housing, the more they would feel stressed as a result of these financial constraints (Bray, 2001).
amonhaemanon2024 - p. 249
n general, those who have financial stress were found to suffer from isolation, despair and depression. However, people could avoid getting into those situations and have a life free of financial distress, simply by equipping themselves with financial knowledge. Linciano and Soccorso (2017) suggested that financial literacy plays an essential role in supporting people trying to overcome financial stress.
amonhaemanon2024 - p. 250
he main objective was to investigate the factors affecting financial stress in this group and determine the factors that drive the informal labor or low-income earners to buying lottery tickets; in relation to economic, social and psychological factors.
amonhaemanon2024 - p. 252
Financial stress is partly viewed as a situation where a person fails to prioritize their household budget appropriately.
amonhaemanon2024 - p. 252
There are shreds of both theoretical and empirical evidence supporting the fact that problem gambling has the potential to lead to financial stress (Muggleton et al., 2021; Oksanen et al., 2018), as well as supporting the impact gambling has on financial wellbeing, such as losing one’s savings and becoming overwhelmed with debt (Mathews and Volberg, 2013).
amonhaemanon2024 - p. 252
When people are questioned about why they gamble, the response “to win money” is frequently the most popular choice since money is the tangible reward and physical incentive for gambling. However, everyone who has ever gambled knows that the motives for participating vary considerably by the game and by the gambler. Hence, why do people gamble on the lottery? (1) the dream of hitting the jackpot or desire to win the lottery. (2) Societal advantages. The social rewards of gambling pertain to three dimensions: communion (socializing with others), competition and ostentation (the player displaying wealth, skill and strong character, thereby gaining prestige). (3) Intellectual challenge. Gambling serves as a stimulating hobby and interest. (4) The mood change induced by games. Some games provide plenty of excitement, while highly repetitive games may be perceived as relaxing and a way of shutting out the outside world. (5) The chance of winning constitutes the core of all gambling games.
amonhaemanon2024 - p. 253
Since the Expected Utility Theory could not explain the gamblers’ behavior, the Behavioral Economics’ Prospect Theory should be applied instead. According to this theory, the values of losses and returns are different, so the utility function then becomes S-shaped. Kahneman and Tversky (1979) noted that despite losing the same amount of money, people’s perceptions of the loss are more than on receipt of that amount. In general, people tend to be more sensitive to the loss of any benefit than the receipt of it. Prospect Theory is employed to explain why people gamble, even when understanding that the expectation is a loss, not a win.
amonhaemanon2024 - p. 254
In our study, the data were collected by using the questionnaire that was certified for conducting research on human beings by the Institutional Review Board of Social and Behavioral Field, Prince of Songkla University (No. IRB, 2020- PSU- L- 002). Part of the questions in the questionnaire was constructed specifically for our study, based on a literature review.
amonhaemanon2024 - p. 254
In the financial literacy part, 7 questions from the study by the Bank of Thailand (Bank of Thailand, 2016) were applied. Only the correct answers were counted and the higher one’s score, the higher one’s level of financial literacy would be.
amonhaemanon2024 - p. 254
Next, the 13 questions, each with 4 choices, from Grable and Lytton (1999) were applied to consider one’s level of risk tolerance.
amonhaemanon2024 - p. 254
Another significant part allowed one to evaluate oneself regarding the level of financial literacy as well as the level of acceptable risk; providing the score range from 0 to 10 from “not at all” to “very high”.
amonhaemanon2024 - p. 254
The overall level of employees’ financial stress was measured on a five-point Likert scale in the question (1 5 never, 5 5 always). The questions on financial stress included items related to worry over delay in payment and financial condition,
amonhaemanon2024 - p. 254
The sample group in our study was an informal laborer group, consisting of laborers over 15 years old by age, working without a contract and with no social security from their workplace. They were randomly selected from 14 provinces in southern peninsular Thailand by a method called Multistage Sampling.
amonhaemanon2024 - p. 254
Later on, the content validity of the questionnaires, as well as the consistency between the questions and the study objectives according to specialists’ views, were examined. The results were then used to calculate the Item Objective Congruence Index (IOC). Indicating reliability, the Cronbach’s alpha equaled 0.837. Overall, a total of 995 questionnaires were completed and subjected to our analysis
amonhaemanon2024 - p. 257
It was found that people would have more financial stress when having more income, having more debt, having knowledge about compound interest, facing emergency expenses, worrying about savings, having an income lower than their expenditures, facing financial constraints, wanting to live a life of luxury and buying lottery tickets with an economic motive