Peer Effects, Warning Messages, and Gambling Behavior: Evidence from a Lab-in-the-field Experiment

The rapid rate of technological advancement has led to a proliferation of online gambling applications in Africa. This has resulted in an unprecedented rise in problem gambling across sub-Saharan Africa. In addition, the rapid growth of the gambling industry has outpaced laws and regulations aimed at consumer protection, limiting the scope of problem gambling interventions. Using a sample of 905 gamblers from Kenya, this study investigated the impact of peer effects and warning messages on gambling behavior using a lab-in-the-field randomized controlled trial. This study found no evidence that peer effects had an impact on gambling behavior. However, gambling warning messages reduced the total amount wagered by 8% and the number of betting rounds played by 4%. Furthermore, the peer effects and warning message condition increased the number of betting rounds played by 13%. Peer interaction likely caused riskier decisions and compulsive gambling, which could have undermined the effectiveness of the warning message. In conclusion, while warning messages offer a potential strategy for minimizing gambling-related harm, and messaging relating to the effects of peer interaction is likely to increase their effectiveness.