The Economic Impacts of Casino Gambling at the State and Local Levels

Gazel, Ricardo

doi:10.1177/0002716298556001006

Cited by 31 publications

(20 citation statements)

References 2 publications

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“…If horse racing and casinos cannibalize each other, a horse-racing state should not introduce new 'players'. Gu (2006) points out that because gaming establishments are highly competitive, many casinos are forced to provide additional attractions, such as food and beverage facilities, entertainment programmes and souvenir shops (Gazel, 1998;Piner and Paradis, 2004). This causes a shift of expenditure from local businesses and if the ratio of local to non-local gamblers is high, this cannibalization effect can be significant (Table 3) (Gazel, 1998).…”

Section: Local Infrastructure -Government and Industrymentioning

confidence: 99%

“…Swarbrooke (1998) emphasizes that the cost and benefits of tourism to a local economy generate the 'multiplier effect', where every dollar spent by tourists circulates around the local economy in a series of waves. Gazel (1998) summarizes the potential income distribution of visitors to a casino (Table 4). Casino and club operations involve many satellite industries, especially in areas such as food and beverages, security, transportation and entertainment (Govoni et al, 1998;Piner and Paradis, 2004;Shoemaker and Zemke, 2005;Hing, 2006).…”

Section: Local Infrastructure -Government and Industrymentioning

confidence: 99%

“…A large number of jobs result from gambling and related operations (Australian Bureau of Statistics, 2006), with each new casino adding to this number by providing jobs for the local community. Table 1 presents the employment in the gambling and related industries in Australia in 2005. Creating jobs that provide good wages is one of the biggest benefits a casino brings to a neighbourhood (Gazel, 1998;Gu, 2006;Dufrene and Swartz, 2007). This study investigates the economic impact of opening a gaming venue in Australia by examining the impacts from the perspectives of government, industry and the local community.…”

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confidence: 99%

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Research Note: The Economic Impact of Opening a Gaming Venue in Australia

Lee

2011

Tourism Economics

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Research shows that opening a large gaming venue has economic impacts. This paper evaluates these impacts from the perspectives of the government, industry and the community. Though the effects are interrelated, the direct impact for each of these stakeholders is unique. For the government, direct taxation, tourism and investment are discussed, with a focus on the immediate effect on infrastructure. For industry, revenue generation, the multiplier effect, leakage, cannibalization and the trend of strategic cross-industry alliance are examined. For the community, average household disposable income, employment rate, direct competition, land speculation and the impact on standard of living are analysed.

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Section: Local Infrastructure -Government and Industrymentioning

confidence: 99%

Section: Local Infrastructure -Government and Industrymentioning

confidence: 99%

mentioning

confidence: 99%

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Research Note: The Economic Impact of Opening a Gaming Venue in Australia

Lee

2011

Tourism Economics

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“…Most of the literature has been institutional in nature focusing on the potential of casinos to generate economic development in a region (Eadington (1999); Fink and Rock, 2003;Henrikson (1996); Gazel (1998)); alternative methods of taxation (Smith (2000); F o r P e e r R e v i e w 2 Paton, Siegel andWilliams, 2001: 2002b); and the control of money laundering (Financial Transaction Reports Act 1988;Roach (2003), and Nicaso (1998)). An exception to the above literature is the paper by Thalheimer and Mukhtar, 2003.…”

Section: Introductionmentioning

confidence: 99%

The economics of casino taxation

Benar

Jenkins

2008

Applied Economics

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Abstract:In this paper, a model of the costs of a casino is developed that focuses on the implications for economic welfare of different taxation schemes for casinos. The situation being considered is in a country where casinos cater exclusively to foreign tourists. The goal of the country is to determine the maximum amount of taxes that can be extracted from the activities of this sector under different systems of taxation. When the price of gambling is set by regulation above its competitive level, the economic losses created by excessive investment in the sector can be reduced by taxation. A turnover tax on the amount gambled can maximize both tax revenue and the economic welfare of the country. Due administrative constraints, a number of countries rely on the taxation of the casinos' fixed assets or a combination of a turnover tax and a tax on fixed costs. The model is applied to the situation in North Cyprus. The annual economic efficiency loss from its poorly designed tax policies on casino gambling is estimated to be about 0.5 percent of GDP.Keywords: Casino, taxation, gambling, tourism, economic benefit JEL Codes: H21, H32, H27 There is a considerable economic literature on the operation and taxation of lotteries (Fink, Marco and Rork, 2004;Glickman and Painter, 2004;Paton, Siegel and Williams, 2004;Clotfelter and Cook, 1993;Clotfelter and Cook, 1990), but the economic literature on the economics of casinos is very limited. Most of the literature has been institutional in nature focusing on the potential of casinos to generate economic development in a region (Eadington (1999);Fink and Rock, 2003;Henrikson (1996); Gazel (1998)); alternative methods of taxation (Smith (2000); (1998)). An exception to the above literature is the paper by Thalheimer and Mukhtar, 2003. In this paper they specifically examine the determinants of demand for casino gambling including its price elasticity. In this paper, we wish to examine a number of regulatory and taxation issues while incorporating the special characteristics of the casino industry.An important characteristic of casinos is that the "price" of gambling, defined here as the percentage of the amount gambled that is retained on average by the casino, is usually not determined competitively by the interaction of the casinos in the market and the demand for casino gambling. Except for slot machines, the table games and roulette have a specific minimum expected take by the house that is set by the rules of the game (Eadington, 1999). There is no reason that these minimum prices are anywhere near to the prices that would be set in a perfectly competitive market. Second, in many jurisdictions the price of gambling is set through government regulation or by state gambling boards. In many cases the "price" is set at several multiples of what might be a competitive price 1 . In such a circumstance, the regulatory question is both one of determining the optimal "price" to set as well as the number of casinos allowed to supply the market.This characteristic is reflected ...

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“…However, to date very little economic analysis has been done on the structure and regulation of the casino sector. Most of the research that has been done has concentrated on issues such as their economic spillover effects on other sectors in the community (Eadington, 1999;Fink and Rock, 2003;Henrikson (1996); Gazel, 1998). The problems associated with casinos such as money laundering and the social cost of compulsive gambling have been given considerable attention (Roach, 2003;Nicaso, 1998).…”

Section: Introductionmentioning

confidence: 99%

Regulation and Taxation of Casinos under State-Monopoly, Private Monopoly and Casino Association Regimes

Benar

Jenkins

2006

SSRN Journal

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This paper considers alternative forms of regulation and taxation of the casino sector. The model considers the situation of a typical tourist destination country that is using casinos to attract and entertain foreign tourists. The objective is to invest in the sector efficiently while maximizing the amount of government revenue or profits accruing to the country. The regulator must determine how the price of gambling will be set, how many casinos will be allowed to enter the industry and the form and rates of taxation. Four alternative forms of regulation are considered: price regulation, state-owned monopoly, private monopoly and casino association regulation. Turnover taxes on the amount of funds gambled and also annual taxation of the fixed costs of the casinos are evaluated. Applications of the models are carried out for North Cyprus. The conclusion is that the economic efficiency costs and the revenue losses from the absence of effective regulation in these tourist destinations can be very substantial with welfare costs equal to the approximately 75 percent of the tax revenue generated by this sector. Furthermore it shows that while a tax on turnover can be efficient in the case of a competitive industry or a cartel association form of regulation, it will be distortunary if a private monopoly is controlling the sector. In contrast a tax on fixed costs will lead to an efficient result in the case of a competitive or private monopoly cases, but it will lead to allocate inefficiencies if the sector is regulated by a casino association that can only control the number of casino entering the sector.

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The Economic Impacts of Casino Gambling at the State and Local Levels

Cited by 31 publications

References 2 publications

Research Note: The Economic Impact of Opening a Gaming Venue in Australia

Research Note: The Economic Impact of Opening a Gaming Venue in Australia

The economics of casino taxation

Regulation and Taxation of Casinos under State-Monopoly, Private Monopoly and Casino Association Regimes

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