GoKawiilJacob Goss and Daniel Mangrum
Editor’s Note: The chart notes for the first chart have been updated to correct errors in how we labeled the trend line colors. (March 25, 2026)
Since 2018, more than thirty states have legalized mobile sports betting, leading to more than a half trillion dollars in wagers. In our recent Staff Report, we examine how legalized sports betting affects household financial health by comparing betting activity and consumer credit outcomes between states that legalized to those that have not. We find that legalization increases spending at online sportsbooks roughly tenfold, but betting does not stop at state boundaries. Nearby areas where betting is not legal still experience roughly 15 percent the increase of counties where it is legal. At the same time, consumer financial health suffers. Our analysis finds rising delinquencies in participating states, with spillover effects across state lines. What is more, even though the share of people taking up sports betting after legalization is small (roughly 3 percent of the population), overall credit delinquency rises by about 0.3 percentage points. Our findings suggest that sports betting can have dramatic implications for household financial stability.
Legalization Leads to High Spending that Continues to Rise
Using anonymized transaction-level consumer spending data, we aggregate online sportsbook deposits at a county-quarter level to compare counties in legal states to those in not-legal states before and after legalization. The chart below plots two measures of average online sportsbook deposits within legal states over time. The blue line (measured by the left axis), presents average deposits per adult. We see that spending grew dramatically after mid-2020, exhibits seasonal patterns consistent with the National Football League season, and continues to grow through the end of 2025.
The red line (measured on the right axis) shows the total deposits divided by the number of individuals with at least one online sportsbook deposit each quarter. In contrast to average deposits in the population, average deposits per bettor have leveled since 2022. We conclude that long-run growth in total betting is driven less by rising deposits among existing bettors and more by broader participation and continued market expansion.
Average Deposits at Sportsbooks Rise Steeply After Mid-2020 Sources: Earnest Analytics; authors’ calculations.
Notes: The chart plots quarterly average deposits at sportsbooks per adult (left axis, red) and per bettor (right axis, blue) in counties with legal mobile sports betting. Both series are unweighted averages across all counties in states where mobile betting is legal in that quarter.
Betting Across Borders
An interesting wrinkle to sports betting access is that potential bettors do not have to be residents of a legal state to place a wager. Since they only need to be physically present in a legal state at the time they make a bet, those living near legal states have relatively easy access to legal sports betting. To account for spillovers across borders in our analysis, we split our sample into three mutually exclusive groups in each quarter: a direct treatment group of counties within a legal state, a spillover group of counties near a legal state but in still-illegal states (within fifteen miles), and a control group of counties farther away from any legal states (at least sixty miles from a legal state). We then compare the evolution of online betting in each quarter relative to the first quarter of legal access (own legalization for the legal counties or nearby legalization for the spillover counties).
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