Benefits of Building Casinos in cities other than Las Vegas

Introduction

Cites worldwide have developed tourist entertainment districts that typically contain an atrium hotel, a festival mall with restaurants and bars, a convention center, a restored historic neighborhood, a domed stadium, an aquarium, new office towers, a redeveloped waterfront, and casinos, which attract tourists, daytime professionals, and suburban evening and weekend visitors. When such tourist entertainment districts are developed in areas surrounded by high crime, poverty, or urban decay, they may be secured and isolated “tourist bubbles.” Such tourist entertainment districts and bubbles often are sites for festivals and spectacles to attract suburban visitors as well as tourists in the ongoing territorial competition (Williams & Hall, Pp. 5-27). This paper discusses the benefits of building Casinos in cities other than Las Vegas.

Discussion and Analysis

Revenue Generation:

By far, the most obvious and commonly cited potential benefit from legalized gambling is revenue to the government. Casinos can contribute a large amount of money to state government coffers. The revenues from gambling are a strong argument for lotteries and casinos. Casinos, as discussed, may provide other economic benefits to a city/state that opens/legalizes them (Hsu, Pp. 19-56).

Unfortunately, the issue of tax revenues it not as simple as it might first seem. In states such as Georgia and South Carolina, lottery revenues are used to subsidize students' tuition. Unlike lotteries, tax revenues from legal casinos are not commonly designated for causes such as education. Such revenues are used to fund the oversight organization and sometimes for help for problem gamblers, with much of the tax revenue going into states' general funds.

As the states continue to face ever-worsening fiscal situations, they will continue to search for alternative ways of raising revenues. Raising more revenue using voluntary taxes is politically easier than cutting spending (benefits) or raising income taxes, property taxes, general sales taxes, or other unpopular taxes.

The total government revenues raised from gambling can be significant. As the American Gaming Association (AGA, 2008) reports, commercial casinos contribute a lot of money to the states, a total of $5.8 billion in the 12 states that had commercial casinos in 2007. The crowding-out issue has not been fully addressed by researchers. One recent empirical study on this topic suggests that gambling's net contribution—considering casinos, lotteries, greyhound racing, and horse racing—to states' budgets are relatively modest when they are positive (Walker & Jackson, in press).

Employment Effects:

Another potential benefit of opening up casinos in cities other than Las Vegas is that they may have positive impacts on city's labor market. First, if a new business opens, it increases the demand for labor, which should push average wages higher. This benefits not only casino employees, but also other workers in the region surrounding the casino. Second, since a casino requires a major capital investment to build, the labor force required to build the facilities can be significant. Even once the building phase is completed, the casino will also need a significant workforce for its everyday operations. Often, a casino represents a major employer in ...