WVA considers expanding gaming

Monday, April 04, 2005

A report for West Virginia points to a growing national trend...an increasing dependence of state governments on gaming revenues. Read more.

The report points to the economic development value of gaming...so called tourist gamblers. There's only one problem. For gambling to generate an economic development impact, more than 60% of the gamblers need to come from outside the region. (I base my conclusion on detailed financial models I built to analyze casinos in Louisiana.) Few casinos can meet the test.

Meanwhile, in Cleveland, the local paper discovers that gambling did not solve the problems in Detroit. Read more.

The scope of Detroit's market is a major part of the reason that casinos don't work to build economic development. According to a 2002 report by Michigan State, nearly 80 percent of gamblers come from the three counties surrounding Detroit. Casinos do more to suck money out of the regional economy than they do to inject new money into the economy.

Relying on casinos as an economic development tool is a little like heating your house with a blow torch. You might be able to do it, but it's not a smart move.

posted by Ed Morrison |

Subscribe with Bloglines

Creative Commons License
This work is licensed under a Creative Commons License.
The Web EDPro Weblog