SOCIAL AND ECONOMIC IMPACTS OF GAMBLING Deliverable 2: Review of Relevant Existing Research 5/27/2013 Deliverable 2: Review of Relevant Existing Research Funded by and prepared for: Town of Plainville A
Table of Contents Section Page Section 1 EXECUTIVE SUMMARY 2 Section 2 INTRODUCTION AND BACKGROUND 5 The Social and Economic Impact of Gambling (SEIG) Report 6 Study Selection and General Characteristics 6 Section 3 SOCIAL AND ECONOMIC IMPACTS OF GAMBLING 7 Problem Gambling 7 Crime 8 Suicide 8 Personal Bankruptcy 9 Community Characteristics Associated with Problem Gambling 9 Electronic Gambling Machines 9 Proximity to Gambling 10 Adaptation 10 Demographic Characteristics 11 Local Employment 11 Community Attitudes Regarding Gambling 12 Government Revenue 12 Local Business Revenue 12 Property Values 13 Section 4 KEY FINDINGS 13 Section 5 CONCLUSIONS 14 Table 1 SUMMARY TABLE OF SOCIAL AND ECONOMIC IMPACTS OF GAMBLING 17 References 18 Appendix SUMMARY DESCRIPTION, METHODS, & FINDINGS OF REVEIWED STUDIES 20 Page 1
SOCIAL AND ECONOMIC IMPACTS OF GAMBLING Deliverable 2: Review of Relevant Existing Research Section 1 EXECUTIVE SUMMARY The purpose of this report is to provide the Town of Plainville with a review of existing research on the social and economic impacts of gambling. The studies reviewed were limited to high quality impact analyses that were relevant to the context of Plainville and the proposed slot parlor at Plainridge Racecourse. The report includes a summary of key findings that appeared across all the studies as well as an examination of the most common methodological approaches employed and the limitations of these approaches. A prevailing theme of the literature on the socioeconomic impacts of gambling is the effects of gambling exposure are complex, and many contextual variables influence how specific communities are impacted. These factors make it difficult to generalize study findings to different contexts, even when they are the result of quality research. Such variables include, but are not limited to, the form of gambling, size and type of venue, timing and intensity of increased exposure, level and duration of prior exposure, various demographic characteristics, taxation structure, and underlying socioeconomic trends. For the purposes of this review, we focused on the two factors that are influential in how gambling impacts a community: form of gaming and type of venue. We reviewed studies that examined contexts similar to the proposed venue in Plainville in order to limit our assessment to the most relevant findings. Gambling impact research is severely limited by inconsistencies in the methodological and theoretical approaches, which makes accurate accounting of the socioeconomic impacts of the gaming industry extremely difficult. Studies vary widely in terms of time period, assessment duration in which impacts were examined, scope of analysis, type and scale of measurement, geographic location, and other details. Page 2
It is also apparent from our review that even well designed impact studies frequently suffer from lack of reliable data necessary for comprehensive analysis. In addition, some of the social impacts of gambling are inherently difficult to identify, particularly the effects on individuals such as gambling addiction and the various emotional and psychological impacts that people feel. To make up for the lack of more objective measures in these domains, researchers are often forced to rely on self-report data from population surveys and interviews. These results are complicated by the fact that the difference between self-reported conditions and actual outcomes is unknown. Further complications come from the difficulty of isolating gambling as a contributing factor in measures of social impact as well as the inherent difficulty in quantifying these impacts. However, significant strides have been made to increase the reliability of gambling research through the development of basic principles for research in this area. 20 Despite these limitations, our review revealed general patterns in the type and direction of social and economic impacts associated with increased gambling that appeared throughout the studies. The Summary Table of Impacts provides an overview of these patterns and provides references for those who want a more in-depth examination of specific domains (see Table 1). i The most consistent economic impacts found across the reviewed studies were: increased government revenue either positive or negative impacts on non-gambling businesses The most consistent social impacts found across the reviewed studies were: increased problem gambling, particularly associated with electronic gambling machines (EGMs), with most of this increase occurring after initial introduction increased personal bankruptcies increased crime (to a small extent, mostly in income-generating crimes) increased employment increased negativity in public attitudes toward gambling Evidence suggests that, in general, on a community level expanded gambling results in a small positive economic impact (increased government revenue), a small positive social impact (an additional leisure activity for recreational gamblers and slightly increased employment) and individually dramatic but relatively small negative community social impacts (increased problem gambling and secondary impacts). In addition, people of low socioeconomic status tend to spend proportionately more on gambling than people of higher socioeconomic status, and are more likely to be problem gamblers. While individuals in these disadvantaged groups are more likely to suffer the consequences of problem gambling (e.g., financial distress, loss of employment, domestic disputes) regardless of their participation in gambling, the research indicates that gambling may i Some of the studies included in this review involved independent analyses using the same data, which creates some duplication in the impact findings. Page 3
exacerbate underlying issues and increase the likelihood of such consequences. This suggests that gambling may contribute to increased socioeconomic inequality, as the majority of negative impacts associated with gambling effect socioeconomically disadvantaged groups within the population. The combined effect of the various contextual influences and methodological inconsistencies mentioned above is a wide range of estimated values for each impact domain. Our review indicates that the impacts of expanded legalized gambling are mostly mixed; the overall impact of gambling in a particular area over a particular time period ranges from small to large in size and positive or negative in direction. For this reason, previous work in other jurisdictions can provide insights but should not be considered conclusive predictors or substitutes for community-specific evaluation efforts. Page 4
SOCIAL AND ECONOMIC IMPACTS OF GAMBLING Deliverable 2: Review of Relevant Existing Research Section 2 INTRODUCTION AND BACKGROUND Plainridge Racecourse, located in the Town of Plainville, is engaged in the process of applying to the Massachusetts Gaming Commission for a Category 2 Gaming License, which will allow the addition of up to 1,250 slot machines to that facility. The Town retained Cummings Associates and their subcontractors to provide a report of the likely costs and benefits of the new slot parlor for the Town and to assist in negotiations toward a Host Community Agreement. This evaluation will assist the Town of Plainville in critically and objectively assessing arguments in support of or in opposition to expanded gaming in the Town. The report will also be useful to the Town in assessing measures proposed by Plainridge Racecource to mitigate the potential negative impacts associated with the introduction of this particular form of gambling. This report is one element of a series of reports designed to address the fore mentioned objectives. The present report consists of a review of better quality studies identified by Williams, Rehm, and Stevens in their comprehensive review of the research on The Social and Economic Impacts of Gambling (SEIG Report). 20 Page 5
The Social and Economic Impact of Gambling (SEIG) Report Decisions about what approach to take to study the social and economic impacts of gambling are important because they ultimately determine what results are obtained. Historically, some gambling impact studies have measured only the most apparent and obvious economic benefits while betterquality studies have included important social impacts. The key challenge has been how to directly compare social and economic impacts, particularly when there is no straightforward way to identify the financial costs of some social impacts. Much of the uncertainty in conducting high-quality socioeconomic impact studies of gambling has been reduced with the recent release of the Theoretical Framework for Conducting Socioeconomic Impact Analyses and Principles for Conducting Socioeconomic Impact Analyses of Gambling contained in the Social and Economic Impact of Gambling (SEIG) Report 20 commissioned by the Canadian Consortium for Gambling Research and cited by the Massachusetts Gaming Commission as the basis for its own approach to assessing the impacts of the introduction of casino gambling in Massachusetts. The SEIG Report 20 contains a systematic review of all of the gambling impact studies that have been carried out internationally over the past 30 years. The study authors identified and reviewed 492 studies of the socioeconomic impacts of gambling. Within these studies they identified 51 studies as high quality empirical investigations, which they further divided into 7 rated excellent quality and 44 studies rated good quality. From this list of 51 studies rated good or excellent in the SEIG report, we selected 19 studies including 6 of the 7 studies rated excellent that were particularly relevant to the Town of Plainville. Study Selection and General Characteristics For the purposes of this review, we focused on two of the factors that are most influential in how gambling impacts a community: form of gaming and type of venue. We selected studies that examined the impacts of electronic gambling machines (EGMs; including slot machines), racinos (combined race track and casino), and multiple forms of gambling. The multiple forms studies were included due to the proximity of the Twin River Casino in Lincoln, RI to Plainville (roughly 17 driving miles, or 24 minutes from the center of town). Plainville residents would have multiple gambling opportunities within easy access following the addition of slot machines to Plainridge Racecourse. These studies include a combination of original research and secondary analysis. The most common research methods were population surveys (by telephone), interviews with community leaders, and statistical analysis of available social and economic data related to gambling. The nature and degree of impacts was examined, as were influential factors such as distance to gaming venues, geographic density of available gaming, population demographics, and history of gambling in the area. Most of Page 6
the studies were conducted in either North America or Australia, and the time period in which impacts were examined were roughly split between the 1990s and the years since 2000. Background and methodology details for each report can be found in Appendix A. In addition to the studies from the SEIG Report 20 by Williams et al., our examination included three recent research reports, 21, 22, 23 written by experts in the field, that provide in-depth analysis of the effects of gambling exposure and community adaptation on the prevalence of problem gambling. These studies were included as the majority of negative impacts of gambling expansion are related to problem gambling and this body of work takes a longer range view (observed changes over several years) compared to most of the community-specific impact studies. Section 3 SOCIAL AND ECONOMIC IMPACTS OF GAMBLING The following section provides research summaries of the main findings for specific social and economic impacts of expanded and newly introduced gambling. The following topic areas are summarized: problem gambling, crime, suicide, personal bankruptcy, community characteristics associated with problem gambling, local employment, community attitudes regarding gambling, government revenue, local business revenue, and property values. Problem Gambling Researchers unanimously agree that the most significant negative impacts of gambling are those associated with problem gambling. Williams, Volberg, and Stevens defined problem gambling as having difficulties limiting money and/or time spent on gambling which leads to adverse consequences for the gambler, others, or for the community. 23 (p.8) Problem gamblers comprise a minority of gamblers that contributes a disproportionately high share of gross gambling expenditures, 2, 4, 5, 6, 9, 11, 13, 15, 17, 19, and problem gambling prevalence tends to be higher in communities 2, 6, 11 with higher gambling expenditure. In their review of prevalence studies from around the world, Williams and colleagues found that the average estimated prevalence of problem gambling across all jurisdictions is 2.3% of the population 23 (p.5) ; estimates from the SEIG studies range from 1.4% to 5.7% for lifetime and current problem gamblers in areas with medium or high concentration of gambling opportunties. 2, 4, 5, 6, 9, 11, 15, 16, 17, 19 Taking into account the collateral effects of gambling addiction on family, friends, and community, researchers estimate, researchers estimate that, on average, between 8% and 10% of the population is directly or indirectly affected by problem gambling 19 (p.279) ; or, as stated in another study, Page 7
gambling addiction indirectly affects between 5 and 10 other people for every problem gambler. 2 (p.23) The most severe consequences of problem gambling (e.g., personal bankruptcy, divorce, suicide) are directly experienced by a minority of problem gamblers, but are likely to have substantial ripple effects. Crime It is clear that the impact of gambling exposure on crime is complex. Research in this area suffers from a lack of reliable data, thus findings are limited. Surveys indicate that problem problem gamblers are much more likely to engage in criminal activity than non-problem gamblers, 6, 9, 11 so there is theoretical reason to expect that the incidence of crime would increase as prevalence of problem gambling increases. Empirically, most studies found either a slight increase in overall crime rate following the introduction or expansion of gambling, 3, 13, 14, 15, 18, 19 while others found increases in certain types of crimes but no significant change in overall crime levels. 4, 5, 9 The most common types of criminal activity associated with problem gambling are non-violent, income-generating 4, 9, 11, crimes such as fraud and theft, as well as family disputes, domestic violence, and drunk driving. 14, 15, 18 15 (p. 207) Only one study found a measurable increase in violent crime associated with gambling. As we might expect, the one type of crime that consistently decreases following the expansion of 19 (p.279) legal gambling is illegal gambling. It is important to note that researchers believe that crime report statistics greatly underestimate the actual prevalence of gambling-related crime as a result of the many crimes that go undetected or 3, 9, 11, 14 unreported, or fail to be recorded as gambling-related. These are some of the many complexities that make evaluating the impact of gambling on crime so challenging. In addition, causal relationships are difficult to establish and impossible to determine conclusively. Suicide In general, research on the relationship of gambling exposure and suicide rates is hindered by a lack of available information, and the evidence is mixed. Most researchers found no clear evidence that the availability of gambling had any impact on the rate of suicide, often citing lack of data and 4, 5, difficulty isolating gambling as a contributing factor rather than a reflection of actual conditions. 11, 16 The fact is that in many suicides, the causes are unknown, and if they causes are known or suspected, they are not always officially recorded. However, two studies found sufficient evidence that gambling was a significant contributing factor in the rate of suicides. A study of gamblingrelated crime in Edmonton, Alberta found that 3.2% of local suicides during the period of study were conclusively gambling-related, and researchers suggested that the actual number of suicides 14 (p.51, 84) related to gambling may be much higher. Another important finding came from a Page 8
comprehensive study of gambling in Alberta, in which researchers estimated that roughly 10% of 19 (pp.182-184) suicides in the province are gambling-related. In addition, in several studies problem gamblers reported having suicidal thoughts and having actually attempted suicide at much higher rates than other people, which speaks to the degree of psychological distress that often accompanies 2, 6, 9, 16, 19 gambling addiction. Personal Bankruptcy Gambling is often funded with personal or household savings, and when those savings run out, problem gamblers tend to draw money from other sources (e.g., household budget, borrowing from loved ones), which can eventually lead to bankruptcy in extreme cases. The actual impact of expanded gambling availability on rate of personal bankruptcies is difficult to assess due to limited data on the factors that contribute to bankruptcy filings. Most of the empirical evidence indicates that personal bankruptcy filings increase following the expansion of gambling, 9, 13, 17, 19 and survey data suggests that problem gamblers may be more than twice as likely to file for bankruptcy than the general population. 9 (p.25) However, there is also evidence that in some cases expanded gambling has 4, 16, 18. no net impact on the rate of personal bankruptcies in a community. Community Characteristics Associated with Prevalence of Problem Gambling Electronic Gambling Machines Electronic gambling machines (EGMs) tend to be more closely associated with problem gambling 2, 6, 7, 9, 11, 18, 19 than any other form of gambling, which is attributed in part to EGMs being a 9, 23 continuous form of gambling, meaning that they allow particularly frequent cycles of play. Specifically, EGMs tends to be the gambling activity on which problem gamblers report spending the most time and money. 2, 6, 9, 11 One study found that individuals in communities with medium or high per capita spending on EGMs were significantly more likely to experience gambling problems than people in communities with low overall EGM expenditures. 6 (p.61) A meta-analysis of gambling surveys conducted in Australia and New Zealand found that problem gambling increased with increasing density of EGMS at a rate of about 0.8 problem gamblers for each additional EGM and no evidence of that rate leveling off with increasing density of EGMs. 22 (p.238) However, two other studies saw no increase in problem gambling when EGMs were increased in communities with extensive prior EGM exposure 4, 5, 19 findings which may support the adaptation theory 21 of gambling exposure (discussed below). Page 9
Researchers found that among problem gamblers, women were much more likely than men to report EGMs as their primary gambling activity. 3, 11 Findings also indicate a positive relationship between increased community access to EGMs, the proportion of women who participate in gambling, and 2, 11 the proportion of women who are problem gamblers. Proximity to Gambling In general, most gamblers live within easy driving distance of the venues they patronize. 2, 4, 6, 18, 19 Two separate population surveys found that among gamblers whose highest-spend activity was EGMs, roughly 40% 15 (p.212) and 54% 6 (p.139) reported that that they lived within 5km (3.1 miles) of their preferred EGM venue. If most gamblers live within easy driving distance of their preferred venues, in theory the majority of problem gamblers live within the same radius. In one study, 38% of probable problem gamblers who reported EGMs as their highest-spend activity reported that proximity was the primary factor influencing their choice of venue, and 26% marked ease of access as their top feature. 6 (p.133) While empirical evidence has been somewhat mixed, some researchers have tentatively concluded that the likelihood of problem gambling is higher for people who live within greater proximity of gaming venues. 2, 11 In a non-sieg study, a national telephone survey of U.S. adults found those who live within 10 miles of a casino have twice the rate of pathological or problem gambling as those who do not. 23 The authors concluded that the most straightforward explanation for this relationship is that the availability of an attractive gambling opportunity can lead to gambling pathology in some people who would not otherwise develop it. 23 Adaptation The relationship between gambling exposure and problem gambling is complex, and the influence of time adds another dimension to the issue. Long-term impact studies indicate that communities adapt to gambling exposure over time in a variety of ways that serve to curb the negative impacts of gambling even as the gambling industries continue to grow. 4, 10, 19, 21, 22, 23 The same analytical study that found problem gambling prevalence to be strongly linked with EGM density also found that prevalence of problem gambling tends to decline over time in the absence of any change in EGM density, with an average annual decrease of 0.09%. 22 (p.15) This decline in prevalence reflects both fewer incidences of new problem gamblers and former problem gamblers dropping out of the population pool due to circumstances that prevent them from gambling. 1, 22, 23 These two factors appear to be influenced by adaptations at the individual and community levels, including, but not limited to, natural recovery and professional treatment; community adjustment to the novelty of gambling opportunities; increased public awareness of the potential harms of gambling; and the 21, 22, 23 development of problem gambling intervention and prevention programs. In theory, these adjustments mean that the economic and social benefits of gambling (e.g., increased tax revenue, increased employment, and enjoyment for non-problem gamblers) would also decline over time as gambling participation rates drop. Because early gambling expenditures tend to be from household savings, the economic benefits and participation rates immediately following the initial Page 10
introduction or expansion of gambling can be expected to decline as savings and other available sources of funding are depleted. 10 Profile of Problem Gamblers Certain demographic characteristics tend to predict higher probability of problem gambling with relative consistency. The demographic factors most consistently associated with higher rates of problem gambling are male gender, 3, 5, 6, 16, 17 younger age, 2, 5, 6, 16, 17 5, 6, 9, 16, less education, lower income, 17 and non-caucasian ethnic identity (especially Indigenous, African-American, and Hispanic- American). 5, 6, 9, 15, 16, 17 Problem gamblers are also much more likely than others to have a family member or significant other with a gambling problem. 2, 5, 6 In addition, the review 23 of worldwide prevalence studies found that there are significantly higher rates of problem gambling among employees of gaming facilities, with newer employees tending to have more problems than experienced employees. Though the exact nature of this relationship is unclear, there is evidence that some of this is a result of people with prior gambling problems seeking work in the industry. 23 (pp.44-45) Problem gamblers also have a high probability of being heavy smokers, 5, 6, 16, 19 5, 6, 9, 16, abusing alcohol 19 and other drugs, 9, 16, 19 having mental health problems, 2, 5, 6, 9, 11, 16, 19 6, 9, 11, 16 and poor physical health. While psychological problems affect disproportionately high numbers of problem gamblers, the relationship between gambling and mental health is unclear. Regarding substance abuse, researchers have suggested that the link between these addictions and gambling addiction might be underlying 2, 6, 16 addictive tendencies in problem gamblers who also suffer from these disorders. Gambling addiction appears to exacerbate the affects of some pre-existing disorders, though evidence also suggests that some issues are actually brought on by excessive gambling. 2 (p.27) If problem gambling and its associated harms are the greatest cost of gambling, and disadvantaged segments of the population are more likely to suffer from problem gambling, we can infer that the harms of gambling are socioeconomically regressive, and that gambling may contribute to greater socioeconomic inequality. Local Employment Most of the evidence suggests that major increases in gambling availability as in the case of the opening of a large casino or multiple venues in a short time frame cause a slight increase in local employment levels through the combination of direct employment at gaming venues and indirect job-creation in gambling-related sectors, although several researchers point out that total gains are offset to a large degree by diversion of jobs from within the community. 3, 5, 8, 10, 13, 16, 17, 19 Three studies found that new gambling venues had no net impact on employment levels, and likely just shifted 2, 4, 15 jobs from other business. Page 11
Regarding EGMs specifically, one study found that expansion lead to a small spike in local employment, but many of these jobs represented displaced employment from other sectors, and at a certain point these gains appeared to level off despite further increases in EGM availability in an 11 (p.47) area. Gaming machines are the least labor-intensive form of gambling, so if consumer spending is diverted to EGMs from other local businesses that employ more people, this can result 11, 23 in a decrease in overall employment. It is also important to recognize that most jobs at gambling venues are low-paying and part-time positions, so while there is often a small rise in overall employment as a result of new venues, this is not necessarily an increase in full-time employment, 2, 4, 5, 9, 11 and the low wages mean less additional, expendable income flowing into the local economy than the same number of full-time or higher salary positions would bring in. Community Attitudes Regarding Gambling The expansion of gambling is consistently associated with increases in negative community attitudes toward gambling. 4, 11, 13, 15, 19 Large majorities of people in communities with high EGM availability believe that EGMs do more harm than good for the community 2, 4, 11, 13, 15, 19 and that the number of EGMs should be limited or reduced. 11, 13, 15, 19 In Louisiana, 33 parishes voted to make EGMs illegal when their contracts expired. 13 (p.v) There were two exceptions to this trend, in which researchers found that community attitudes toward gambling were less negative (i.e., more neutral or positive) following the opening of new gaming venues, although nearly all of those surveyed supported strict regulation of EGMs. 3, 5 Government Revenue As we would expect, the introduction and expansion of gambling has a consistent and substantial positive impact on government revenue, due mostly to the direct tax revenue generated by new facilities. 3, 4, 5, 8, 9, 10, 13, 15, 16, 17, 19 Increased government revenue may be offset slightly by increased government spending if additional public resources are required to address problem gambling or other impacts of gambling. However, more specific findings are difficult to generalize due to the differences in municipal, regional, and national settings where the studies were conducted and the wide variation of tax structures. Local Business Revenue There is little evidence that increased gambling availability has any significant impact on overall local business revenue. One study found a modest increase in net business revenue following the Page 12
introduction of legalized gambling, but this finding should be viewed with caution, as the span of the study was limited to the first year after introduction. 8 (pp.79-80) Because most gambling expenditures come from local residents, money spent on gambling often diverts money from savings and other spending opportunities within the community, resulting in little if any net change in local business revenue. 2, 4, 5, 12, 13, 15, 17 By the same token, research shows that additional EGMs often have negative impacts on other forms of gaming and some other business sectors (e.g., recreation and apparel) when they are introduced in large numbers. 4, 11, 12, 15, 17 However, neighboring or complementary businesses like bars and restaurants tend to benefit from the added business that comes with new 5, 8, 10, 12, 17 gambling facilities. Local businesses can also suffer as a result of increased problem gambling. Surveys indicate that problem gamblers often lose time at work and study and frequently get laid off due to impaired job 2, 3, 5, 7, performance as a result of gambling, which translates into lost productivity for their employers. 11, 16, 19 Property Values There may be theoretical reason to believe that new gambling venues would impact property sales and valuation in the surrounding area, either positively or negatively, but the limited empirical evidence available reveals no clear relationship. Few studies that we reviewed examined the impact of gambling on the real estate market, but among those that did, there was no evidence that new 4, 18, 19 venues have any reliable or significant impact on property values or sales in the community. Section 4 KEY FINDINGS New gaming facilities tend to contribute a significant increase in government revenue from direct tax of gambling revenues. Compared to other forms of gambling, EGMs generally contribute proportionately higher tax revenues due to higher consumer expenditures on EGMs than other forms. There tends to be a small shift in business revenue following the expansion of gambling in an area, but this generally represents a diversion of income from other saving and spending opportunities to gaming expenditures rather than a net increase or decrease. Page 13
The most significant negative impact of expanding gambling in a community is an increase in prevalence of problem gambling and related issues. This is particularly true of EGMs and particularly true for residents with closest proximity to the gaming venue. However, in areas with a mature gambling industry, there appears to be a point at which the prevalence of problem gambling no longer increases despite continued increases in gambling availability. Generally, a slight increase in personal bankruptcy rates is seen following the introduction of legal gaming to a community. A significant increase in negative attitudes about gambling tends to follow the expansion of gaming availability. Large increases in gambling availability in a community generally tend to have a small positive impact on local employment through the creation of gambling and gamblingrelated jobs. However, expanded gaming often results in displacement of jobs from other sectors within the community, which has no net impact on employment rates. Expanded gambling is often coincides with a small increase in overall crime rate due to greater occurrence of particular types of crime related to gambling generally non-violent, income-generating crimes. However, evidence is very limited and mixed, and research in this area is very challenging due to the complex interactive nature of crime rate with other community variables. Expanded gambling may contribute to increased socioeconomic inequality, as the majority of negative impacts associated with gambling effect socioeconomically disadvantaged groups within the population. People of low socioeconomic status tend to spend proportionately more on gambling than people of higher socioeconomic status, and are more likely to be problem gamblers. Section 5 CONCLUSIONS As our review has emphasized, the effects of gambling exposure are complex, and many contextual variables influence how specific communities are impacted. These factors make it difficult to generalize study findings to different contexts, even when they are the result of quality research. Such variables include, but are not limited to, the form of gambling, size and type of venue, timing Page 14
and intensity of increased exposure, level and duration of prior exposure, various demographic characteristics, taxation structure, and underlying socioeconomic trends. For the purposes of this review, we focused on the two factors that are influential in how gambling impacts a community: form of gaming and type of venue. We reviewed studies that examined contexts similar to the proposed venue in Plainville in order to limit our assessment to the most relevant findings. Gambling research is severely limited by inconsistencies in the methodological and theoretical approaches to studying impacts, which makes accurate accounting of the socioeconomic impacts of the gaming industry extremely difficult. Studies vary widely in terms of time period and length of time in which impacts were examined, scope of analysis, type and scale of measurement, geographic location, and other details. It is also apparent from our review that even well designed impact studies frequently suffer from lack of reliable data necessary for comprehensive analysis. In some instances, relevant information that was promised was not delivered, and other times the desired information was either inconsistently recorded or never collected in the first place. In addition, some of the social impacts of gambling are inherently difficult to identify, particularly the effects on individuals such as gambling addiction and the various emotional and psychological impacts that people feel. To make up for the lack of more objective measures in these domains, researchers are often forced to rely on self-report data from population surveys and interviews. These results are complicated by the fact that the difference between self-reported conditions and actual outcomes is unknown. Further complications come from the difficulty of isolating gambling as a contributing factor in measures of social impact as well as the inherent difficulty in quantifying these impacts. However, significant strides have been made to increase the reliability of gambling research through the development of basic principles for research in this area. 20 Despite these limitations, our review revealed general patterns in the type and direction of social and economic impacts associated with increased gambling that appeared throughout the studies. The Summary Table of Impacts provides an overview of these patterns and provides references for those who want a more in-depth examination of specific domains (see Table 1). Evidence suggests that, in general, on a community level expanded gaming results in a small positive economic impact (increased government revenue), a small positive social impact (an additional leisure activity for recreational gamblers and slightly increase employment) and individually dramatic but relatively small negative community social impacts (increased problem gambling and secondary impacts). In addition, people of low socioeconomic status tend to spend proportionately more on gambling than people of higher socioeconomic status, and are more likely to be problem gamblers. While individuals in these disadvantaged groups are more likely to suffer the consequences of problem gambling (e.g., financial distress, loss of employment, domestic disputes) regardless of their participation in gambling, the research indicates that gambling may exacerbate underlying issues and increase the likelihood of such consequences. This suggests that gambling may contribute to increased socioeconomic inequality, as the majority of negative impacts associated with gambling effect socioeconomically disadvantaged groups within the population. Page 15
The combined effect of the various contextual influences and methodological inconsistencies mentioned above is a wide range of estimated values for each impact domain. Our review indicates that the impacts of expanded legalized gambling are mostly mixed; the overall impact of gambling in a particular area over a particular time period ranges from small to large in size and positive or negative in direction. For this reason, previous work in other jurisdictions can provide insights but should not be considered conclusive predictors or substitutes for community-specific evaluation efforts. Page 16
Table 1. SUMMARY TABLE OF SOCIAL & ECONMIC IMPACTS OF GAMBLING Impact Area Increase Changes (but no net increase or decrease) No Impact Decrease SOCIAL Problem Gambling 1, 2, 3, 4, 5, 6, 8, 9, 10, 11, 13, 14, 15, 16, 17, 19 4 Personal Bankruptcies 9, 13, 17, 19 4, 16, 18 Suicide 14, 19 4, 5, 11, 16 Crime 3, 13, 14, 15, 18, 19 4, 5, 9 Employment 3, 5, 8, 10, 13, 16, 17, 19 2, 11 4, 15 Negative Attitudes Toward Gambling 4, 11, 13, 15, 19 3 5 ECONOMIC Government Revenue 3, 4, 5, 8, 9, 10, 13, 15, 16, 17, 19 Business Revenue 8 2, 4, 5, 10, 12, 13, 15, 17 11 Property Values 4, 18, 19 Numbers in the table correspond with studies in the Reference list Page 17
REFERENCES Number references throughout the text and in the summary table correspond with the reference numbers below Impact Studies from the SEIG Report 1. Abbott M. Do EGMs and problem gambling go together like a horse and carriage? Gambling Research: Journal of the National Association for Gambling Studies (Australia). 2006;18:7-38. 2. Australia Productivity Commission, Banks G, Fitzgerald R. Australia's gambling industries inquiry report. Melbourne: Productivity Commission; 1999. 3. Australian Institute for Gambling Research. Report of the first year of the study into the social and economic impact of the introduction of gaming machines to Queensland clubs and hotels. Brisbane, Australia: Queensland Department of Families, Youth and Community Care; 1995. 4. Blue Thorn Research, Population Health Promotion Associates, PFIA Corporation and Williams RJ. Socioeconomic impacts of new gaming venues in four British Columbia lower mainland communities: Final report. Victoria, BC: Gaming Policy and Enforcement Branch, Ministry of Public Safety & Solicitor General, Government of British Columbia; 2007. 5. Hann RG, Nuffield J. Local community impacts of the charity casinos: The final report. Toronto: Ontario Substance Abuse Bureau Ministry of Health and Long-Term Care; 2005. 6. Hare S. A study of gambling in Victoria: Problem gambling from a public health perspective. Melbourne, Australia: State of Victoria, Department of Justice; 2009. 7. Lin E-YJ, Casswell S, Easton B, Huckle T, Asiasiga L, You RQ. (2010). Time and money spent gambling and the relationship with quality-of-life measures: A national study of New Zealanders. Journal of Gambling Issues. 2010;24:33-53. 8. Madden, MK. Economic and fiscal impacts associated with the first year of gaming: Deadwood, South Dakota. Pierre, SD: South Dakota Commission on Gaming; 1991. 9. Montana Gambling Study Commission. The 1998 Montana gambling study: A report to the Governor and the 56th Legislature by the Gambling Study Commission. Helena, MT: Montana Legislative Services Division; 1998. 10. National Institute of Economic and Industry Research. The economic impact of gambling: Project report. Melbourne, Australia: Victorian Casino and Gaming Authority; 2000. 11. O Neil M, Whetton S, Neal P, Dolman B, Dolman M, Kosturjak A. Community impacts of electronic gaming machine gambling (Part A / Part B). Adelaide, South Australia: SA Centre for Economic Studies; 2005. Page 18
12. Pinge I. The impact of electronic gaming machines on retail trade in Victoria the first four years, 1992-96. Bendigo, Australia: La Trobe University, Bendigo; 2000. 13. Ryan TP, Speyrer JF. Gambling in Louisiana: A benefit/cost analysis. Prepared for The Louisiana Gaming Control Board. New Orleans, LA: Division of Business and Economic Research, University of New Orleans; 1999. 14. Smith G, Wynne H, Hartnagel T. Examining police records to assess gambling impacts: A study of gambling-related crime in the City of Edmonton. Edmonton, AB: Alberta Gaming Research Institute; 2003. 15. South Australian Centre for Economic Studies, O'Neil M, Chandler N, Kosturjak A, Whetton S, Lindsay S. Social and economic impact study into gambling in Tasmania: Volume one. Report commissioned by Department of Treasury and Finance Tasmania. Adelaide, South Australia: South Australian Centre for Economic Studies; 2008. 16. Spectrum Gaming Group. Gambling in Connecticut: Analyzing the economic and social impacts. Linwood, NJ: Spectrum Gaming Group; 2009. 17. Volberg RA, Stuefen RM, Madden MK. Gaming in South Dakota: A study of gambling participation and problem gambling and a statistical description and analysis of its socioeconomic impacts. Vermillion, SD: Business Research Bureau, University of South Dakota; 1991. 18. Wall M, Peter M, You R, Mavoa S, Witten K. Problem Gambling Research: A study of community level harm from gambling: Phase one Final Report: Report to Ministry of Health. Auckland, New Zealand: Centre for Social and Health Outcomes Research and Evaluation & Te Ropu Whariki; 2010. 19. Williams RJ, Belanger YD, Arthur JN. Gambling in Alberta: History, Current Status and Socioeconomic Impacts. Final Report submitted to the Alberta Gaming Research Institute. Edmonton, Alberta. April 2, 2011. http://hdl.handle.net/1880/48495 or http://research.uleth.ca/seiga/index.html SEIG Report (from which our 19 impact studies were selected) 20. Williams, RJ, Rehm, J, Stevens RM. The Social and Economic Impacts of Gambling. Final Report prepared for the Canadian Consortium for Gambling Research. March 11, 2011. Additional Resources 21. LaPlante DA, Shaffer HJ. Understanding the influence of gambling opportunities: Expanding exposure models to include adaptation. American Journal of Orthopsychiatry. 2007;77(4):616-623. 22. Storer J, Abbott M, Stubbs J. Access or adaptation? A meta-analysis of surveys of problem gambling prevalence in Australia and New Zealand with respect to concentration of electronic gaming machines. International Gambling Studies. 2009;9(3):225-244 23. Williams RJ, Volberg RA, Stevens RM. The Population Prevalence of Problem Gambling: Methodological Influences, Standardized Rates, Jurisdictional Differences, and Worldwide Trends. Report prepared for the Ontario Problem Gambling Research Centre and the Ontario Ministry of Health and Long Term Care. May 8, 2012. Page 19
APPENDIX A SUMMARY DESCRIPTION, METHODS, & FINDINGS OF REVIEWED STUDIES Number references throughout the text and in the summary table correspond with the reference numbers below. 1. Abbott M. Do EGMs and problem gambling go together like a horse and carriage? Gambling Research: Journal of the National Association for Gambling Studies (Australia). 2006;18(1):7-38. SEIG Rating: Good Quality Type: Secondary Analysis Gambling Format: Electronic Gambling Machines (EGMs) Location: Worldwide Years Impacts Examined: To 2006 Description: A literature review of gambling impact studies aimed at examining the relationship between electronic gambling machines and the prevalence of problem gambling across a variety of locations, time periods, community settings, and venue types. Studies included both cross-sectional and time series surveys and assessments included impacts at the level of nation, region, state, county, and city. Impacts Economic: N/A Impacts Social: Increase in EGM exposure and participation is strongly associated with increase in problem gambling, but eventually problem gambling rates level off even as EGM exposure increases 2. Australia Productivity Commission, Banks G, Fitzgerald R. Australia's gambling industries inquiry report. Melbourne: Productivity Commission; 1999. SEIG Rating: Excellent Quality Type: Original Research; Methodological Issues Gambling Format: All Gambling (including impacts by mode of gambling) Location: Australia Years Impacts Examined: To 1999 Description: An examination of the social and economic impacts of the gambling industries across Australia since the introduction of legal gambling in the country. Research methods Page 20
included three new national population surveys; public hearings; expert roundtables; solicitation of written submissions from the public and community leaders; meetings and discussions with study participants; and analysis of available data and research. Impacts Economic: Change in Business Revenue (Net gains in jobs and economic activity are small when account is taken of the impact on other industries of the diversion of consumer spending to gambling) Impacts Social: Changed Leisure Activity (The main source of national benefit from the liberalisation of gambling has been the consumer gains from access to a service that gives people enjoyment); Change in Employment (Net gains in jobs and economic activity are small when account is taken of the impact on other industries of the diversion of consumer spending to gambling) 3. Australian Institute for Gambling Research. Report of the first year of the study into the social and economic impact of the introduction of gaming machines to Queensland clubs and hotels. Brisbane, Australia: Queensland Department of Families, Youth and Community Care; 1995. SEIG Rating: Good Quality Type: Original Research Gambling Format: Electronic Gambling Machines (EGMs) Location: Australia Queensland Years Impacts Examined: 1992-1994 Description: A report on the social and economic impacts of introducing EGMs to clubs and hotels in Queensland one year after introduction. Impacts Economic: Increased Government Revenue (taxation revenue exceeding any loss of revenue from a decline in other forms of gambling and any additional costs incurred by the state in administering the machines); Increased Infrastructure Value Impacts Social: Increased Employment (increase in direct gaming employment and equivalent number in ancillary employment between 1992 and 1994; significant regional impact); Increased Positive Attitudes (favorable; 50% of respondents from a random sample agreeing that machines had benefited the community); Increased Problem Gambling 4. Blue Thorn Research, Population Health Promotion Associates, PFIA Corporation and Williams RJ. Socioeconomic impacts of new gaming venues in four British Columbia lower mainland communities: Final report. Victoria, BC: Gaming Policy and Enforcement Branch, Ministry of Public Safety & Solicitor General, Government of British Columbia; 2007. SEIG Rating: Excellent Quality Type: Original Research; Secondary Analysis Gambling Format: Casinos; Racinos Location: Canada British Columbia Vancouver, Surrey, Langley Page 21
Years Impacts Examined: 2004-2006 Description: A longitudinal study of the community-level social and economic impacts of three new gaming venues in the British Columbia Lower Mainland, including two new casinos and additional slot machines added to an existing race track facility. A series of population surveys was conducted before, during, and after the opening of the three venues to measure community perceptions and attitudes. Economic and social data from before and after the openings was collected and analyzed for quantifiable impacts of the growth in gambling. Research Methods: Three telephone surveys (RDD: listed and unlisted residential phone numbers) of about 2,500 community residents; surveys of municipal representatives; patron surveys at the new venues; employee surveys at the new venues; qualitative interviews with community leaders; comparison of available social and economic indicators. Impacts Economic: Increased Government Revenues; Increased Public Services; Increased Infrastructure Investment (due to venue construction; there was no impact on housing starts, residential/non-residential construction value); No Impact on Business Failures; Increased Business Revenue (revenue increase for hotels/motels not attributable to venues however); No Impact on Property Values Impacts Social: Increased Negative Attitudes; No Net Impact on Crime (no change in 3 communities, decrease in 4th community); No Impacts on Employment; No Impact on Problem Gambling (except the one community that did not previously have convenient access to a casino) 5. Hann RG, Nuffield J. Local community impacts of the charity casinos: The final report. Toronto: Ontario Substance Abuse Bureau Ministry of Health and Long-Term Care; 2005. SEIG Rating: Good Quality Type: Original Research; Secondary Analysis Gambling Format: Casinos; Horse Racing Racinos; Electronic Gambling Machines (EGMs) Location: Canada Ontario Sault Ste. Marie, Brantford, Point Edward, Sarnia, Thunder Bay, Gananoque Years Impacts Examined: 2000-2004 Description: A report on the social and economic effects of introducing four new charity casinos and a slot machine expansion at an existing race track facility to four communities across Ontario. The study tracked data on a wide range of socio-economic conditions in the four communities and compared the trends before and after the openings, including community expectations, opinions, and perceptions, and reported gambling behaviors. In areas where hard data was not forthcoming, more attention was paid to community perceptions. Research Methods: Telephone surveys from before and 3-4 years after the venue openings; patron surveys at new venues, including a series of patron surveys in one of the communities; expert consultations; community discussions and input concerning study design; collection and Page 22
analysis of data concerning socioeconomic context and the gambling industries; review of current and prior research reports and media related to gambling. Impacts Economic: Changes in Business Revenue (divert income and savings from other saving/spending within the local economy; only modest positive impacts on local businesses); Increased Public Services (smaller charities losing revenues; larger ones may be benefiting) Impacts Social: Increased Problem Gambling and Related Indices (slight increase in serious problem gamblers after casino openings); Increased Employment 6. Hare S. A study of gambling in Victoria: Problem gambling from a public health perspective. Melbourne, Australia: State of Victoria, Department of Justice; 2009. SEIG Rating: Good Quality Type: Original Research Gambling Format: All Gambling (multiple forms) Location: Australia Victoria Years Impacts Examined: 2008 Description: An investigation of the prevalence and distribution of problem gambling in Victoria from a population health perspective, including assessment of the various factors associated with increased risk for problem gambling. Impacts: N/A 7. Lin E-YJ, Casswell S, Easton B, Huckle T, Asiasiga L, You RQ. (2010). Time and money spent gambling and the relationship with quality-of-life measures: A national study of New Zealanders. Journal of Gambling Issues. 2010;24:33-53. SEIG Rating: Good Quality Type: Original Research Gambling Format: All Gambling; focus on EGMs Location: New Zealand Years Impacts Examined: 2007 Description: A cross-sectional study examining the relationship between gambling participation and spending patterns and quality-of-life measures in New Zealand. The aim was to provide quantitative measures of the impacts of gambling on the health and wellbeing of individuals and communities. Research Methods: Telephone survey (RDD; listed and unlisted residential phone numbers) of 7,010 adults in New Zealand composed of a stratified general population sample and oversamples of Maori, Pacific, and Chinese/Korean populations. Questions concerned loss-toincome ratio, quality of life measures, and engagement in illegal activities. Page 23
Impacts Economic: N/A Impacts Social: Negative Impact on Quality of Life (In summary, the evidence from the current study that time spent gambling disaggregated into different modes of gambling is very informative. Although playing EGMs in bars was the greatest risk for people s quality of life, some forms of gambling proved to have beneficial impacts on the gamblers.) 8. Madden, MK. Economic and fiscal impacts associated with the first year of gaming: Deadwood, South Dakota. Pierre, SD: South Dakota Commission on Gaming; 1991. SEIG Rating: Good Quality Type: Original Research; Secondary Analysis Gambling Format: Casinos; Lotteries; Indian Gaming Casinos; Electronic Gambling Machines (EGMs) Location: United States South Dakota, Deadwood Years Impacts Examined: 1987-1991 Description: An examination of the fiscal, economic, and social impacts of the first year of legal gambling in Deadwood, South Dakota. Researchers tracked social and economic data from the town of Deadwood and surrounding communities from before and after the introduction of gambling to identify and assess the impacts of the new gambling industry in Deadwood. Fiscal impacts were assessed at the levels of county, municipality, and school district. The study focused on the impacts of increased visitor spending in the area as a result of the new gambling venues. Research Methods: Comparison of measures of economic activity during the 12 months prior to the introduction of gambling in Deadwood to the same measures recorded during the 12 months following introduction expenditures, employment, employee earnings, and fiscal impact. Impacts Economic: Economic: Increased Government Revenue (6.2% of state general revenue fund in 1991); Changes in Business Revenue (positive for eating/drinking establishments; negative impact on recreation and apparel sectors) Impacts Social: Increased Employment (addition of 2,500 jobs in associated businesses); Increased Problem Gambling and Related Indices (mixed results with respect to divorces, food stamp recipients, child neglect, etc.; bankruptcy rates increased in first two years post-gambling introduction) 9. Montana Gambling Study Commission. The 1998 Montana gambling study: A report to the Governor and the 56th Legislature by the Gambling Study Commission. Helena, MT: Montana Legislative Services Division; 1998. SEIG Rating: Good Quality Type: Original Research Page 24
Gambling Format: All Gambling; focus on Electronic Gambling Machines (EGMs) Location: United States Montana Years Impacts Examined: 1997-1998 Description: The first comprehensive study of the social and economic impacts of legal gambling in the state of Montana. Analysis was based on social and economic data collected over one year from across the state in relation to the state s gambling industry. Research Methods: Household survey of a representative sample of the Montana population; survey of self-selected members of Gamblers Anonymous; review of patient records from two inpatient treatment facilities for gambling addiction; statistical analysis of social and economic data from communities across the state. Impacts Economic: Increased Government Revenue (Cities and towns are particularly dependent on Video Gambling Machine Tax revenue.); Public Costs Associated with Problem Gambling (treatment programs and law enforcement); No Impacts Social: Negative Impacts of Problem Gambling (Increased bankruptcy: problem gamblers are more than twice as likely to file for bankruptcy than the general population; increased alcohol dependency; increased depression; increased rate of attempted suicide). No Net Impact on Employment; No Systematic Pattern in Crime Rate Changes (between communities in Montana and those in states without gambling) 10. National Institute of Economic and Industry Research. The economic impact of gambling: Project report. Melbourne, Australia: Victorian Casino and Gaming Authority; 2000. SEIG Rating: Good Quality Type: Original Research; Secondary Analysis Gambling Format: Electronic Gambling Machines (EGMs) Location: Australia Victoria Years Impacts Examined: 1992-1998 Description: An assessment of the economic impacts of growing gambling industries in the state of Victoria designed to complement previous social impact studies. New and existing data from a six-year period was analyzed for trends related to the expansion of gambling availability in the state during that time. Research Methods: Analysis of micro- and macroeconomic data collected over a six-year period at the levels of state, region, community, household, and individual and the links between the various levels. Impacts Economic: Changes in Business Revenue (insufficient evidence to determine relationship between gambling and other expenditures... but there have been increasing expenditures on alcohol, tobacco and meals away from home; gambling often financed from savings rate but it is likely that gambling will be substituted for other household expenditures over time; those substitutions yet to be identified) Page 25
Impacts Social: Increased Employment; Increased Problem Gambling (increase in problem gambling... though perhaps a once-only event representing a response to the increase in availability) 11. O Neil M, Whetton S, Neal P, Dolman B, Dolman M, Kosturjak A. Community impacts of electronic gaming machine gambling (Part A / Part B). Adelaide, South Australia: SA Centre for Economic Studies; 2005. SEIG Rating: Excellent Quality Type: Original Research; Secondary Analysis; Methodological Issues Gambling Format: Electronic Gambling Machines (EGMs) Location: Australia Victoria, Western Australia Years Impacts Examined: 1983-2003 Description: An assessment of the community impacts of EGMs based on a comparison of related factors in regions in Victoria, which has a high concentration of EGMs, and similar regions in Western Australia, which has an extremely low concentration of EGMs consisting of one casino for the entire state. Original research and existing data from the two regions were compared to provide an understanding of both short- and long-term impacts of the gambling industries. Measures compared included population gambling behavior, gambling environment, impact of EGMs on other forms of gambling, and community attitudes toward gambling. Research Methods: Interviews, focus groups and surveys with local residents and stakeholders; consultations with local leaders in business and government; data collection and trend analysis. Impacts Economic: Decrease in Business Revenue (expenditure may also have been drawn away from the café and restaurant sector) Impacts Social: Changes in Employment (a clear rise in employment for Victoria during the period in which EGMs were rapidly introduced into venues; introduction did not lead to a permanently higher level of employment; job intensity associated with gambling is low; legalization of EGMs may reflect a shift of employment between sectors rather than increasing employment overall); Increased Negative Attitudes (Victorians less satisfied with gambling than Western Australian); Increased Problem Gambling and Related Indices (prevalence rate of problem gambling in Victoria is three times that of Western Australia; more problems related to EGMs in Victoria; 1994 to 1999 was the period of high growth in the number of pawnbrokers and second-hand dealers in the Greater Melbourne area; however, suicide rates similar in Western Australia and Victoria) 12. Pinge I. The impact of electronic gaming machines on retail trade in Victoria the first four years, 1992-96. Bendigo, Australia: La Trobe University, Bendigo; 2000. SEIG Rating: Good Quality Page 26
Type: Original Research; Secondary Analysis Gambling Format: Electronic Gambling Machines (EGMs) Location: Australia Victoria Years Impacts Examined: 1986-1996 Description: An examination of the impact of the introduction of EGMs on retail trade in the state of Victoria of based on trend analysis of a variety of economic indicators prior to EGMintroduction and during the first four years of operation. Research Methods: Collection and analysis of retail data from a ten-year period using a multiple regression model involving gambling revenue, employment, and seasonal variation developed for the study. Impacts Economic: Changes in Business Revenue (Introduction of electronic gaming machines have had a complex and diverse impact on the retail sector overall. Gaming appears to have embedded itself into clear underlying trends in retail trade reflecting lifestyle changes that were occurring over the ten years of review; these spending patterns were already moving away from spending on large ticket items such as furniture and clothing toward spending on groceries and eating out, and gaming appears to have had no disruptive effect on these trends.) Impacts Social: N/A 13. Ryan TP, Speyrer JF. Gambling in Louisiana: A benefit/cost analysis. Prepared for The Louisiana Gaming Control Board. New Orleans, LA: Division of Business and Economic Research, University of New Orleans; 1999. SEIG Rating: Good Quality Type: Original Research; Secondary Analysis Gambling Format: Casinos; Indian Gaming Casinos; Electronic Gambling Machines (EGMs) Location: United States Louisiana Years Impacts Examined: 1998 Description: A study of the economic impacts of legal gambling on Louisiana based on analysis of relevant data from fiscal year 1998. Original surveys and existing data focused on communities in Louisiana that had relatively high concentrations of available gambling. Research Methods: Two telephone surveys of about 4,000 people total, including general population and an oversample from communities with higher gambling availability, and a panelback survey examining prevalence of problem gambling; patron intercept surveys of over 1,700 people; mail survey of over 2,800 businesses in gambling areas; survey of license plates in venue parking lots to determine patron origin; employee survey using a random sample of venue employees; surveys of members of Gamblers Anonymous and problem gambling treatment program participants; analysis of economic and employment data from fiscal year 1998. Page 27
Impacts Economic: Increased Government Revenue (a higher tax rate for casino gambling than other forms of spending from which some revenue was displaced; Increased Regulatory Costs (most significantly for regulating, policing and running lottery game); Costs Related to Problem Gambling (estimate based on costs of problem gamblers extrapolated to entire population based on prevalence study figures; 29.9% of spending on riverboat casinos from problem gamblers, 42.3% of spending in Indian casinos from problem gamblers, 27.1% of spending on video poker from problem gamblers) Impacts Social: Increased Employment (In 1998, riverboat and Indian casinos produced 20,156 jobs directly; not including any "multiplier effect" of ancillary employment.) 14. Smith G, Wynne H, Hartnagel T. Examining police records to assess gambling impacts: A study of gambling-related crime in the City of Edmonton. Edmonton, AB: Alberta Gaming Research Institute; 2003. SEIG Rating: Good Quality Type: Original Research Gambling Format: Casinos; Bingo; Electronic Gambling Machines (EGMs) Location: Canada Alberta Edmonton Years Impacts Examined: 2001-2002 Description: An assessment of the impacts of gambling on crime rate and nature of crime in the City of Edmonton. Research Methods: Review of Edmonton Police Service (EPS) records and occurrence files; review of Alberta Gaming and Liquor Commission (AGLC) criminal investigation files; interviews with police officers; developed a new report form for officers with the aim of increasing recording of gambling-related crime, which suffered due to lack of officer implementation; mapped reported crimes to gambling venues; interviews with EPS and Royal Canadian Mounted Police (RCMP) officers and supervisors; interviews with security personnel at major venues; collection and analysis of data and relevant media; interviews with gambling enforcement officials; review of research literature and theory concerning gambling-related crime. Impacts Economic: N/A Impacts Social: Increased Crime (Official rates of gambling-related crimes are quantitatively low, but these numbers greatly underestimate the true prevalence as a result of under-detection, underreporting, and unknown attributions; the types of crime commonly associated with problem gambling fraud, theft, domestic violence are most closely linked to the gambling formats with the highest addictive potency, such as EGMs) 15. South Australian Centre for Economic Studies, O'Neil M, Chandler N, Kosturjak A, Whetton S, Lindsay S. Social and economic impact study into gambling in Tasmania: Volume one. Report Page 28
commissioned by Department of Treasury and Finance Tasmania. Adelaide, South Australia: South Australian Centre for Economic Studies; 2008. SEIG Rating: Excellent Quality Type: Original Research; Secondary Analysis; Methodological Issues Gambling Format: All Gambling; focus on Electronic Gambling Machines (EGMs) Location: Australia Tasmania Years Impacts Examined: 1983-2007 Description: An analysis of the social, financial, and economic impacts of legal gambling in Tasmania, including original studies of problem gambling prevalence and community attitudes toward gambling. Research Methods: Telephone survey (White Pages; listed residential numbers only) of 4,051 Tasmanian adults over two months in 2007; review of literature and previous reports; interviews and consultations with business groups, agencies, political representatives, counselors, and local government officials; written submissions solicited from community leaders and the public. Impacts Economic: Increased Government Revenue; No Impact on Business Revenue (No significant growth in aggregate economy, and no significant impact on retail; level of gambling expenditure does not appear to impact the level of non-gambling final consumption expenditure) Impacts Social: No Clear Impact on Employment (data sources are poor but there appears to be little impact); Increased Consumer Surplus (form of economic impact from gambling whose effect was unambiguously positive was the consumer surplus); Increased Problem Gambling and Related Indices (main source of gambling problems derives from EGMs); Increased Crime (a positive and significant relationship was found between gaming expenditure and some crime rates, particularly "income-generating crimes") 16. Spectrum Gaming Group. Gambling in Connecticut: Analyzing the economic and social impacts. Linwood, NJ: Spectrum Gaming Group; 2009. SEIG Rating: Excellent Quality Type: Original Research; Secondary Analysis Gambling Format: All Gambling (multiple forms) Location: United States Connecticut Years Impacts Examined: 1992-2008 Description: An analysis of the social and economic impacts of all forms of legal gambling in Connecticut aimed at understanding citizens gambling behavior and assessing the desirability of expanding, maintaining, or reducing the amount of legalized gambling in the state. The last impact study of gambling in Connecticut was completed in 1997. Page 29
Research Methods: Telephone (RDD; listed and unlisted residential numbers) and internet surveys; interviews with more than 150 people; literature review; collection and analysis of new and existing data regarding community indicators of social and economic trends as they relate to legalized gambling. Impacts Economic: Increased Government Revenue; Changes in Public Services (contributions to charitable causes; but Charitable gaming, like Off-Track Betting, has also seen significant declines in gross receipts for non-profit organizations.); Increased Infrastructure Investment (hotels built take advantage of the presence of the casino resorts); Increased Business Failures (other forms of gambling: state s last jai alai fronton, in Milford, closed in 2001 and the two greyhound parks ceased live dog racing in 2005. Live horse racing is still authorized by statute, but no horse track has ever operated.); Increased Regulatory Costs. Impacts Social: Increased Employment (about 30,000 jobs created in Connecticut through direct and ancillary employment); Increased Problem Gambling and Related Indices (Problem Gambling Services division has experienced a more than six-fold increase in its caseload from 2001 to 2008); Decreased Public Health (dramatic increase in highway traffic, a rise in drivingwhile-intoxicated arrests, increased costs related to ESOL programs and a myriad of social problems as well); Increased Crime (State and federal law enforcement officials made 43 embezzlement arrests in 1992, the year the first Indian casino opened; in 2007, the most recent year that statistics are available, the number increased to 214; however, we can make no definitive conclusions about the relationship between this dramatic increase and gambling) 17. Volberg RA, Stuefen RM, Madden MK. Gaming in South Dakota: A study of gambling participation and problem gambling and a statistical description and analysis of its socioeconomic impacts. Vermillion, SD: Business Research Bureau, University of South Dakota; 1991. SEIG Rating: Good Quality Type: Original Research; Secondary Analysis Gambling Format: Casinos; Lotteries; Indian Gaming Casinos; Electronic Gaming Machines (EGMs) Location: United States South Dakota Years Impacts Examined: 1987-1991 Description: An assessment of the economic and social impacts of legal gambling in South Dakota, limited to those which are quantifiable and statistically recorded both before and after the introduction of various forms of gambling in the state. Social and economic factors were examined on a county basis wherever possible, and variations on the county level concerning the mix and intensity of gambling activity were analyzed. Research Methods: Telephone survey (listed residential numbers only) of a stratified sample of 1, 560 adults in South Dakota regarding prevalence of problem gambling; comparison of prevalence data to other states; collection and analysis of quantifiable economic data at the county level before and after the introduction of various forms of gambling. Page 30
Impacts Economic: Increase in Government Revenue (6.2% of state general revenue fund in 1991); Changes in Business Revenue (positive for eating and drinking establishments; negative for recreation and apparel sectors) Impacts Social: Increased Employment (addition of 2,500 jobs in associated businesses); Increase in Problem Gambling and Related Indices (mixed results with respect to divorces, food stamp recipients, child neglect, etc.; bankruptcy rates increased in first two years postgambling introduction) 18. Wall M, Peter M, You R, Mavoa S, Witten K. Problem Gambling Research: A study of community level harm from gambling: Phase one Final Report: Report to Ministry of Health. Auckland, New Zealand: Centre for Social and Health Outcomes Research and Evaluation & Te Ropu Whariki; 2010. SEIG Rating: Good Quality Type: Original Research Gambling Format: Electronic Gaming Machines (EGMs) Location: New Zealand Years Impacts Examined: 2006 Description: An assessment of the community impacts of legal gambling in New Zealand, including analysis of the relationship between community indicators of gambling impacts and the extent of gambling availability in the community based on the Census Area Unit (CAU) definition of community boundaries. This study is the first phase of a larger project funded by the Ministry of Health aimed at identifying and ameliorating the negative community impacts of gambling. Research Methods: Developed measures of gambling exposure and related community harm; analyzed community impacts related to density of EGMs within 800m (walking distance) and 5km (driving distance) of road network and distance to nearest EGM venue; collected and analyzed data regarding negative social impacts related to gambling exposure; Analysis of new and existing data regarding community indicators of social and economic trends as they relate to the availability of gambling in the community, defined as a Census Area Unit (CAU). Impacts Economic: No Change in Property Values (There was no significant relationship between gambling exposure and the number of property sales or property prices) Impacts Social: Increased Crime (higher exposure to gambling opportunities was significantly linked to higher crime rates for all categories of crime investigated); Decrease in Social Capital (for urban areas a higher density of gaming machines within 5000m of the Census Area Unit was significantly associated with worse perceptions of a community s social capital. People had lower levels of trust, less sense of belonging, rated community cohesion as lower and had worse relationships with others) Page 31
19. Williams RJ, Belanger YD, Arthur JN. Gambling in Alberta: History, Current Status and Socioeconomic Impacts. Final Report submitted to the Alberta Gaming Research Institute. Edmonton, Alberta. April 2, 2011. SEIG Rating: Excellent Quality Type: Original Research Gambling Format: All Gambling (multiple forms) Location: Canada Alberta Years Impacts Examined: 1970-2010 Description: A comprehensive analysis of the social and economic impacts of legal gambling in Alberta and examination of the development of the gambling industries. Research Methods: Two cross-sectional telephone surveys (RDD; listed and unlisted residential numbers) of population samples of 3,001 and 1,004 people in 2008 and 2009; supplemental internet surveys of 2,019 and 1,006 people in 2008 and 2009; Targeted Population Surveys of 4,512 residents of four new casino areas where casinos were first introduced in 2007/2008, and 3,624 five control established casino areas in 2008 and 2009; direct investigation of data including employment, revenue, and infrastructure investment and costs for the province of Alberta. Impacts Economic: Increased Government Revenue; Increased Public Services; Increased Infrastructure Value; Increased Regulatory Costs; No Impact on Business Starts; No Impact on Business Failures; No Impact on Business Revenue; No Impact on Property Values; Increased Problem Gambling Financial Costs. Impacts Social: Increased Employment (very small); Increased Socioeconomic Inequality (small); Increased Leisure Options; Increased Negative Attitudes (although positive for community leaders); Increase in Crime (small); Increase in Problem Gambling & Related Indices (PG prevalence has positive but weak relationship with legal gambling availability; positive but weak relationship with consumer insolvencies); Decreased Subjective Well-Being (non-gamblers somewhat more likely to be very happy ) Page 32