Over the past twenty years, gambling has become a growth industry in the United States, the United Kingdom, Canada, Australia, Macau (Macao), and other nations.1 Once restricted to Nevada and, later, Atlantic City, casinos now operate in 33 U.S. states. Since Congress passed the Indian Gaming Regulatory Act (IGRA) in 1988, tribes in 28 states have established casinos, and others are seeking federal recognition so that they can do the same.
According to the National Indian Gaming Commission, 236 Indian tribes are currently operating casinos.2 In 2010, Indian casinos earned approximately $26.5 billion (National Indian Gaming Commission 2011). California alone has 56 tribal casinos, making it one of the most lucrative gambling markets in the world. Starting in 1989 with Iowa, states began to legalize land-based riverboat casinos, horse and dog racetrack casinos (racinos), and urban casinos.3
Altogether these non-Indian commercial gambling casinos earned over $34.6 billion in gross gambling revenues in 2011 (American Gaming Association 2011). Including those operated by Indian tribes and regulated by the states, casinos generated over $61 billion in annual revenues. Over a decade ago, the National Gambling Impact Study Commission (NGISC) was established to investigate various issues regarding the legalization of gambling.
After sponsoring several major studies and conducting hearings in different cities across the country, the NGISC issued a final report that called for a moratorium on new gambling venues (NGISC 1999). Despite this recommendation, new casinos continue to be established, with urban land-based casinos and Indian casinos being the most prevalent.
The rapid growth of commercial gambling has been striking not only in 4 casinos the United States but also worldwide. The unprecedented growth of governmentsanctioned gambling raises a number of policy issues related to the social and economic impacts of gambling. The purpose of this study is to examine how the introduction of commercial gambling casinos impacts a state’s economy by focusing on changes in industry employment. This chapter is divided into four parts.
The first provides an overview of the literature on the economic and social impacts of commercial gambling. This is followed by a set of hypotheses that are used to examine the effects of casino gambling on state employment. Next, a regression analysis of the relationship between changes in industry employment and gambling is presented. The conclusion summarizes the findings and discusses the limitations of the study and future research directions.