Las Vegas, Monte Carlo, Macau, Atlantic City, Reno… All these cities are famed across the globe for their casinos and resorts. Synonymous with gambling, there is no question that for these destinations, legalised gambling fuels the economy and brings many benefits to their local communities including tourism, jobs, greater tax revenues and increased retail sales for other non-gambling businesses in the cities. However, problem gambling can also have a negative impact and the social and economic costs of pathological gambling need to be considered to evaluate the overall impact that gambling has upon communities.
The growth of legal gambling in the US has been fuelled primarily by public acceptance of gambling as a form of entertainment. Often associated with glitz and glamour – casinos hold a particular lure to the everyday Joe that is hard to resist. Add to that the promise of substantial economic benefits and it’s not hard to see why local governments want them in their neighbourhoods.
Take Vegas - the strip is the second most popular attraction in the United States after Times Square in Manhattan – and its home to some of the most well-known casinos in the world, with around 75 in total. A gambling oasis and adult playground – it attracts millions of people to the Nevada desert each year. The whole Vegas economy is fuelled either directly or indirectly by people gambling.
Macau – the only place in China where gambling is legal, has seen stellar growth in gaming revenue in recent decades. But as the market starts to mature and feel the impact of high rollers moving onto regional gaming hubs in Southeast Asia as junket operators shift to those territories, the saving grace has been the huge number of tourists that had started to flock to Macau pre Covid. This meant that revenues from the “mass market” surpassed VIP’s for the first time in 2019 - and saw casinos racing to build bigger and flashier resorts to offer more entertainment options – meaning more jobs and tourist bucks for the local communities.
Many states in America have approved commercial casino gambling because it is seen as a tool for economic growth. With perceived benefits including increased employment and job opportunity within the local area, greater tax revenue, enhanced tourism and rising property values. But the economic benefits also bring a social cost to communities.
Historic data from the GAO found some evidence that pathological gambling in areas with casinos did result in increased crime and family problems, such as intimate partner violence and child abuse, divorce, and homelessness. However, it also suggested that some of these effects might actually be primarily due to other problems that usually accompany pathological gambling, such as alcohol or drug abuse.
And while local governments incur increase costs for more police and management of roads, congestion and sewers, the taxes earned from casinos, including application fees, regulatory fees, wagering taxes, and admission taxes, help fund programs that can improve the quality of life for many within the immediate vicinity or state.
The effect on property prices depends on the area in which the casinos are located but the overall view is that the impact of casinos, according to the National Association of Realtors, on local property values is "unambiguously" negative and do not revive local economies but instead act as parasites upon them, which can play a heavy role on home values.
But what of modern casino gambling? Easy access to no deposit casinos through your laptop, phone or tablet to an environment where you can just keep playing has fuelled the mobile gaming industry which was said to be worth $100bn at the end of 2017. Does technology have a bigger part to play in the development and growth of the betting industry and problem gambling than your bricks and mortar casinos? With none of the positive economic upsides that casinos bring to local communities?