Is gambling in any way subversive of capitalism?

Great answer from Martin W. (15.9.03):

- Indeed it is. First of all, capitalism as an economic theory (as opposed to "capitalism is just what happens when you leave people alone", which is quite persuasive), particularly the subset often known as free market capitalism, rests to a large extent on the efficient market theory. An "efficient" market is one where the price of a thing accurately reflects its value and changes in this value are quickly, if not immediately, reflected in the price.  If anyone really knew how to match the value of a thing to its price we could all go home now and live off unending bounty for ever. It is commonly said of efficient market theorists that they wouldn't pick up a $100 bill lying in the street because if it was worth picking up somebody else would have done so already.

The efficient market theory is nonsense. In the efficient market theory, people will always allocate their capital in the most advantageous way to themselves, according to the information available to them. The only way an economic advantage can be gained is by having better information -- about a company's prospects, and so on. This is why there are insider trading laws.

Most of all, it assumes that people -- or rather, economic agents -- act "rationally" (one of the questionable assumptions is that rationality=maximising economic gain). I would guess that very few gamblers claim that gambling is the use of their money most likely to make more money. Voluntarily being skinned by the house is fundamentally anti-capitalist. An extreme form would be to gamble, win and refuse to collect your winnings. (I sometimes fantasise about winning the Lottery and returning every single pound to the people who bought the tickets.)

Running a bookmakers, of course, is an almost perfectly capitalist activity.  Can one side of a transaction support capitalism while the other subverts it? Hmm.