This, in turn, provided a good estimate of the positive effects of casinos in the two states. A second set of studies generally emphasizes description over analysis. The emphasis in these studies tends to be on simple identification of benefits and costs associated with gambling, with limited emphasis on estimating their value Aasved and Laundergan, ; Aasved, ; Stockowski, When an attempt is made to discuss economic effects, especially the social costs associated with problem gambling, the estimates are taken directly from other studies, without any independent analysis or attempts to determine whether the results of other studies are applicable in the situation under investigation Grinols, Balanced measurement studies encompass a variety of economic impact analysis studies.
Although these studies differ in their approaches and vary in their contributions to advancing gambling-related economic impact analysis, they all emphasize the identification and measurement of costs, including costs related to pathological and problem gambling.
They also reflect a discernible evolution in the methodology used to arrive at impact estimates, beginning with a heavy reliance on earlier work and slowly moving to a more innovative approach. The strength of these studies precludes them from being relied on for policymaking, but it may not be long before useful studies are available.
The six studies described exemplify the application of methodological considerations described above, as well as the progression of economic impact analysis in the field of pathological gambling. This study assessed the effects that additional pathological gamblers would have on Chicago with the introduction of casino gambling.
Whenever possible, the authors assigned monetary values; when they could not, they at least discussed the costs that they could not quantify.
Rather than building their cost estimates from scratch, the authors relied on previously published estimates of prevalence rates and gambling costs from other sites to estimate likely costs for Chicago Politzer et al. There is nothing inherently wrong with relying on estimates derived from other studies, as long as the estimates are appropriate for the task at hand.
The analysts must understand the size, structure, and the composition of the sample that was used to arrive at the estimate; they must clarify the assumptions underlying the calculations, along with the influences the assumptions may have on the estimates; and they must determine if the characteristics of the source community are sufficiently similar to that of the subject community to allow the use of the estimates without reservations or adjustments.
Unless these conditions are satisfied, the resultant estimates may be of questionable value. There is no evidence that the Chicago study attempted to consider whether the estimated costs and prevalence rates borrowed from other studies were appropriate to Chicago. In addition, the authors do not appear to have tried to separate real costs from transfer costs, nor did they try to estimate aggregate pathological gambling costs rather than incremental costs due to pathological gambling.
In a study that strays from traditional economic impact analysis, Grinols and Omorov attempted to determine, using benefit-cost analysis, whether improved access to casino gambling offsets the externality or spillover costs associated with pathological gambling.
Their study takes a unique approach to the estimation of the net economic effects of gambling. Instead of focusing on a particular geographic area, as most economic impact studies do, they attempted to estimate the effect of increasing gambling accessibility nationwide.
They define externality costs as criminal justice system costs, social service costs, and costs due to lost productivity. In order to estimate the per capita social costs due to pathological gambling, they relied on the annual cost estimates per pathological gambler and prevalence rates for pathological gambling computed in earlier studies Goodman, ; Lorenz et al.
They do not, however, further the understanding of what constitutes the costs of pathological gambling or the magnitude of these costs.
Instead, Grinols and Omorov relied on the work done by others to assign dollar values to the externalities and used these estimates without any attempt to determine whether the estimates were appropriate for the task at hand.
In a study that attempted to identify the benefits and costs associated with gambling, Madden looked at the socioeconomic costs of gambling in South Dakota. The analysis—a simple time series analysis of data for identified benefits and costs—represents one of the first attempts to determine whether some of the alleged costs associated with pathological and problem gambling were appearing in communities that were adopting or expanding legalized gambling.
Madden does not specifically consider the costs of pathological and problem gambling but does analyze trends in factors that often are cited as being affected by such gambling, including the number of recipients of Aid to Families with Dependent Children, the number of families receiving food stamps, the number of child abuse and neglect cases, the number of child support cases, the number of divorce filings, the percentage of property taxes that are not collected, the number of bankruptcy filings, the number of small claims filings, and the number of real estate foreclosures.
This study raises another potentially difficult problem with gambling studies. When gambling is introduced to an area, there is a natural temptation to do simple before-and-after comparisons and to attribute positive or negative differences to the introduction of gambling.
In other words, the effects of gambling are deemed to be any changes that have occurred since gambling was introduced. But this is not necessarily true. For example, if per capita income is found to be higher after gambling was introduced, is the rise in income attributable to gambling?
Perhaps it is, but perhaps not. Per capita incomes have typically been rising in the United States, so perhaps some of the gain is due simply to general economic growth.
Perhaps other things happened in the community that would increase per capita income. During the same period in which per capita incomes were found to rise in the community in which gambling was introduced, per capita incomes may well have also risen in communities in which gambling was not introduced.
Similarly, if personal bankruptcies increased following the introduction of gambling, the analyst would also need to know what the trend in personal bankruptcies was elsewhere and during the same time period before attributing the increase to increased gambling availability.
A Florida study of the effects of casino gambling represents an improvement in the identification and estimation of the benefits and costs of pathological and problem gambling Florida Office of Planning and Budgeting, Its derivation of the net positive benefits considered the direct and indirect effects that casinos will have on the state economy, carefully considering expenditure substitution and leakage to ensure that the focus is on additional spending associated with the casino and not some measure of gross economic activity.
Rather than accept the Volberg estimate without question, the researchers examined circumstances specific to Florida to ensure that the estimates were appropriate. This was accomplished by estimating the incarceration, supervision, and new prison construction costs that would be attributable to problem gambler criminal incidents, using Florida Department of Corrections data.
These estimates indicated that Volberg's annual societal cost figures were reasonable to use for estimating potential impacts in Florida. In order to determine the increase in pathological and problem gamblers that would result from casino gambling, the study also relied on estimates generated from three different sources, rather than adopting without question a prevalence rate generated for a different single community.
The three estimates are based on: 1 the projected market share that casinos would command in the legalized gambling market in the state, 2 a number derived from experiential data provided by the Florida Council on Compulsive Gambling, and 3 a figure based on information provided by the National Council on Compulsive Gambling.
The Florida study cost estimation methodology is noteworthy because, although the study relied on per gambler estimates calculated for another jurisdiction, it first assessed the appropriateness of applying that estimate to Florida.
In addition, the study used three prevalence estimates derived from three communities rather than relying on a single generic estimated prevalence rate. Taken together, the per pathological gambler cost estimate and the three prevalence estimates enabled the analysts to provide a range of costs attributable to pathological gamblers if casinos were approved in Florida.
Unfortunately, the study was based on several key but untested assumptions that may have had the effect of overestimating costs associated with pathological and problem gambling and minimizing the benefits of casino gambling.
Specifically, the researchers advance a conservative estimate of new tourism and also assumed that Florida would experience substantial substitution effects in the food and recreation industries if casino gambling were approved.
Closer examination also reveals that, in relying on the Volberg cost to society estimate per pathological or problem gambler, the state adopted her reliance on the estimate by Lesieur and Klien that two out of three pathological or problem gamblers become incarcerated or otherwise impose substantial criminal justice costs—an assumption not independently tested.
A significant improvement in the methodology used to identify and estimate the social costs of gambling, and specifically pathological and problem gambling, is found in a study conducted in Australia Dickerson et al.
This study apparently is one of the first studies to perform a comprehensive and carefully thought-out economic impact analysis of gambling. The survey provides extensive information about patterns of gambling in New South Wales, attitudes toward gambling, gambling preferences, and information relating to the negative effects associated with problem gambling, among other things.
The study details the approach taken to estimate the prevalence of problem gambling. Clearly, the researchers carefully considered the appropriateness of their estimate for the subject community, not choosing to rely on estimates developed elsewhere.
To identify the costs associated with problem gambling, the researchers used information from their survey and from their own clinical databases. Once the identification phase was completed, they used the following methodology to place a dollar value on as many of the costs as they could pp.
The study was able to "cost out" a number of factors associated with pathological gambling. The process used to arrive at the productivity loss estimate shows the care the researchers used as they developed their cost estimates.
They looked at data from both the survey and the clinics to identify employment-related costs and the extent to which problem gamblers were affected. On the basis of these data, the productivity loss estimate was derived using an assumption that one hour per week was lost per problem gambler, an estimate of the number of problem gamblers affected, the average earnings earned, and the percentage of individuals in the workplace versus the home.
The authors also were careful to underscore how sensitive the estimate is to the assumption regarding average time lost at work. A second factor associated with problem gambling in the study is legal costs. Although an estimate is included for family and individual costs, the researchers note that many of the family-related effects identified do not lend themselves to quantification because it would involve a very subjective process.
As a result, only two family and individual effects are given a dollar value: the costs of divorce proceedings and acute treatment costs. The methodology used by the researchers to reach this estimate of net positive effect involved the use of input-output multipliers, carefully adjusted for substitution of expenditures and leakage.
It is noted that the costs amount to 1. However, the authors are quick to note that they use conservative costing assumptions and that a number of the effects identified are not assigned dollar values.
The net economic benefit is therefore likely to be overstated. A second study that makes a significant contribution to the literature on the economic impacts of gambling is one that identifies and quantifies the social costs of gambling in the state of Wisconsin Thompson et al.
The authors point out that there is little objective information about the benefits and costs associated with gambling, much less the costs of pathological and problem gambling, but that many studies have offered opinions about the effects such gambling has on society.
The approach taken by these researchers to arrive at estimates of the costs of pathological and problem gambling involved using a survey instrument to get information from serious problem gamblers in Wisconsin Thompson et al. They distributed questionnaires to members of Gamblers Anonymous chapters and received 98 completed surveys.
The questionnaires provided the researchers with demographic data on the respondents, gambling histories, information about some of the games they played, volume of gambling activity and the source of funds, and the consequences of gambling. The authors used the information obtained from the survey to attempt to answer the following questions: 1 How much does one serious problem gambler cost society?
To answer these questions, they used information from their survey as well as information provided by earlier research on the costs of problem gambling. They chose to focus on employment costs, bad debts and civil court costs, thefts and criminal justice system costs, therapy costs, and welfare costs.
They calculated the costs for all problem gamblers in the state and for a subset of problem gamblers who could be associated with the state's American Indian casinos. Employment costs included both the annual cost of working hours lost due to gambling plus the unemployment compensation attributable to gambling.
Estimates of the loss in productivity due to gambling were based on how many hours of work the gambler lost due to unemployment. The researchers chose to use this measure rather than attempt to estimate the loss of productivity on the job, which they thought involved too much subjectivity.
Bad debts were calculated by focusing on the debt burden of the problem gamblers in the study who were involved in bankruptcy court proceedings. Thompson et al. In reality, it is likely that many problem gamblers will ultimately pay little of their debts.
These estimates were combined with the bad debt estimates to provide the estimates for the annual total bad debt and theft-related costs per gambler. Even this study, however, is not without serious flaws and often counts as benefits things that would properly have been considered transfers.
Nevertheless, this study is an important improvement over many previous ones. argue that their estimates of the social costs of problem gambling are conservative but realistic, although others have suggested the estimates are too high see Walker and Barnett, point out that the calculations are based on information obtained from the survey of problem gamblers and other outside sources.
In addition, they are careful to identify the assumptions and methodology used in the calculations, something most previous studies failed to do. The researchers underscore the intentional conservatism of their analysis Thompson et al. We wish the information we present to be useful for policy makers, so we have carefully avoided adding numbers into the formula where we felt that we could not reasonably make good assumptions and good estimates of the costs.
Nonetheless, we suspect that the areas not considered do represent social costs, and these may be revealed in more refined studies in the future. Some areas where costs must exist, but were not considered, include the lower productivity on the job, family disorganization, and bad debts by those who do not declare bankruptcy.
Because they did not have sufficient information themselves to make a reasonable estimate, they chose to not make one. Despite the recent improvements made in the estimation of the benefits and costs of gambling, this area of inquiry is still in its infancy.
A very few studies have recently made large strides over the contributions of earlier studies, which generally focused only on the positive economic benefits or provided descriptions of the cost factors associated with pathological and problem gambling, but did not attempt to estimate the costs of gambling, much less the costs of pathological and problem gambling.
Still, benefit-cost analysis of pathological and problem gambling remains undeveloped. In most of the impact analyses of gambling and of pathological and problem gambling, the methods used are so inadequate as to invalidate the conclusions. Researchers in this area have struggled with the absence of systematic data that could inform their analysis and consequently have substituted assumptions for the missing data.
The assumptions adopted for specific studies were rarely examined or tested to ensure they were appropriate for the specific research being conducted. There is always the risk that such assumptions and resulting estimates may reflect the bias of the analyst rather than the best-informed judgment.
Critical estimates have been frequently taken from one study and haphazardly applied in different circumstances.
Often, the costs and benefits were not properly identified so that things that should have been counted as costs or benefits were omitted and other things that should have been omitted were counted. Even when these limitations were recognized by the authors, they were rarely acknowledged.
Clearly there continues to be a need for more objective and extensive analysis of the economic impact that gambling has on the economy. Although the methodology to estimate the net positive effects is fairly well developed, substantial work needs to be done on the cost side.
It is especially important to focus on the effects that are associated with problem gambling. The task will not be easy and the effort will be costly and time-consuming. The Australian and Wisconsin research studies have set the stage for others by outlining the process that needs to be followed and by showing how such studies should proceed.
These studies do have their limitations, however. For example, more attention could have been focused on ensuring that the costs being estimated are real costs and not just transfers. But they provide a framework so that others can replicate their findings and to advance knowledge about the costs of problem gambling.
Other important issues remain unexplored. One issue is the question of how important the problem gambler is to the gambling industry's financial health. A casual look at the casino industry suggests that this is an industry with high fixed costs and very low marginal costs to serve an additional patron.
If that is indeed the industry's cost structure, then very little additional revenue can result in substantial increases in profits. By the same token, a small decrease in revenue can result in a substantial decrease in profits.
Thus, even if problem gambling proves not to be very prevalent in aggregate terms, it could still have a substantial influence on industry profits. Another unexplored issue is to what degree the findings on the economic impact of casino gambling apply to other forms of gambling.
As this chapter indicates, most of the research deals with casinos. We know little about the economic impact of other forms of gambling. Finally, few of the studies on the economic impact of gambling to date have appeared in peer-reviewed publications.
Most have appeared as reports, chapters in books, or proceedings at conferences, and those few that have been subject to peer review have, for the most part, been descriptive pieces. As this research evolves, it should be subjected to peer review to help ensure that it indeed is advancing the body of knowledge.
The committee recognizes that the possibility of benefits deriving from pathological gambling are only theoretical and are neither described in the literature nor supported empirically.
The committee expresses special thanks to Lia Nower for her synthesis and written presentation of literature pertaining to the social costs of pathological gambling to individuals, families, communities, and society.
The committee thanks Kurt Zorn for his written synthesis, analysis, and presentation of the literature in the remainder of this chapter. The category of transfer is often referred to as pecuniary in the economics literature.
The Indiana Gaming Commission used input-output models to compare and evaluate the competing applications for riverboat gambling licenses. The committee thanks Rina Gupta for her investigation and written summary of state-level lottery and gambling commission reports.
Because there is no specific multiplier for the gambling industry, the entertainment and recreation sector multiplier often is used as a proxy because gambling is contained in this Census Bureau category. Hewings et al. The authors were careful to point out that their analysis dealt only with the benefit side of the equation.
Problem gambling has been linked to these factors, and one would expect problem gambling to be on the rise in South Dakota due to the spread of legalized gambling. Therefore a worsening in one or more of these factors may suggest that at least part of the costs are due to problem gambling.
The reason for a lack of precision regarding whether this indeed is the first study of its type is attributable to information provided in another study, Study Concerning the Effects of Legalized Gambling on the Citizens of the State of Connecticut report prepared for the Division of Special Revenue, Department of Revenue Services, State of Connecticut, June This study refers to five noteworthy studies that have been conducted in this area: a study in Quebec, a study in Germany, a study in Illinois, a study in Australia, and a study in Wisconsin.
Only the last two studies were obtained by the committee, leading to uncertainty as to whether the Australian study is the first or one of the first studies to undertake this approach to the estimation of pathological gambling costs.
Because this study was conducted in Australia, the monetary amounts presumably are in Australian dollars. The acute treatment incidence was based on reported suicide attempts, taken from the clinical database. The authors are quick to note that this estimate does not include any additional costs that may be incurred due to the need for additional services in the future.
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Show details National Research Council US Committee on the Social and Economic Impact of Pathological Gambling. Contents Hardcopy Version at National Academies Press. Search term. Costs to Individuals 2 As discussed in Chapter 2 , the definition of pathological gambling includes adverse consequences to the individual, such as involvement in crime, financial difficulties, and disruptions of interpersonal relations.
Financial Problems and Crime Financial losses pose the most immediate and compelling cost to the gambler in the throes of his or her disorder.
Issues and Challenges in Benefit-Cost Analyses of Gambling 3 A wide variety of economic techniques is available to assess the effects of new or expanded gambling activities. Real Versus Transfer Effects One of the biggest stumbling blocks in economic impact analysis is determining which effects are real and which are merely transfers.
Direct and Indirect Effects A casino will have both direct and indirect effects on an area's income and jobs. Tangible and Intangible Effects Both the direct and the indirect effects mentioned above are tangible, because they result in measurably more jobs and additional income being generated in the local economy.
Defining the Frame of Reference A central issue critical to all economic impact studies is the frame of reference for the analysis McMillen, Identifying and Measuring Costs: An Example of Unpaid Debt When one measures the economic effects of pathological and problem gambling Lesieur, , , , financial costs such as debt, insurance, medical, work-related, and criminal justice costs are fairly easy to measure.
Assessment of Studies Measuring the Costs and Benefits of Gambling 6 Although there are studies that purport to investigate the economic effects of gambling, few show the careful, thorough efforts that are needed to estimate the actual net effects of gambling on society, and therefore few have made a real contribution to understanding these issues e.
Gross Impact Studies Gross impact studies focus on a single aspect of economic effect. Descriptive Studies A second set of studies generally emphasizes description over analysis. Balanced Measurement Studies Balanced measurement studies encompass a variety of economic impact analysis studies.
Chicago Study This study assessed the effects that additional pathological gamblers would have on Chicago with the introduction of casino gambling. National Assessment In a study that strays from traditional economic impact analysis, Grinols and Omorov attempted to determine, using benefit-cost analysis, whether improved access to casino gambling offsets the externality or spillover costs associated with pathological gambling.
South Dakota Study In a study that attempted to identify the benefits and costs associated with gambling, Madden looked at the socioeconomic costs of gambling in South Dakota. Florida Study A Florida study of the effects of casino gambling represents an improvement in the identification and estimation of the benefits and costs of pathological and problem gambling Florida Office of Planning and Budgeting, Australian Study A significant improvement in the methodology used to identify and estimate the social costs of gambling, and specifically pathological and problem gambling, is found in a study conducted in Australia Dickerson et al.
Personal costs, which involve a transfer of money between different sectors of the economy, without impinging on economic activity such as the stock of debts owed by gamblers , are not included. prevalence was estimated either from the survey results or, where more appropriate, from the clinical databases available.
the team's professional judgment was used to decide whether the survey results or incidence from clinical databases were used as the basis for costings.
the incidence of each impact was converted to annual cases per annum for the [New South Wales] adult population. costing assumptions were then sourced or estimated for each impact and applied to the prevalence data. It should be added that we have been conservative in our costing assumptions, where data on which to base assumptions [have] not been readily available.
Wisconsin Study A second study that makes a significant contribution to the literature on the economic impacts of gambling is one that identifies and quantifies the social costs of gambling in the state of Wisconsin Thompson et al. Conclusions Despite the recent improvements made in the estimation of the benefits and costs of gambling, this area of inquiry is still in its infancy.
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La muestra estuvo conformada por personas quienes asisten a los casinos Zafiro SA y Slot Casino Selva SAC. Además, otro aspecto importante es que los casinos casi nunca instan a sus usuarios a descansar después de cierto tiempo después de haber estado jugando, por lo cual se estuviera contribuyendo a minimizar la ludopatía que se genera.
Asimismo, otro problema es que el personal no se encuentra motivado y satisfecho. Colecciones Tarapoto []. Temas Casinos - Aspectos sociales - Perú - Tarapoto Casinos - Administración - Perú - Tarapoto.
This study examines the viewpoints of Macau and Singapore residents to the development of casino gambling and the social, economic, and environmental The effects of gambling can be structuralized using a conceptual model, where impacts are divided into negative and positive; costs and benefits Los impactos sociales del juego patológico, la ludopatía y los casinos. El juego crea ciertos costos sociales que otras industrias del entretenimiento no crean
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