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The Economics of Regulation and Taxation Policies for Casino Tourism

Author

Listed:
  • Hasret Benar

    (Cyprus International University, LefkoÅŸa, Mersin 10, Turkey)

  • Glenn P. Jenkins

    (Queen's University, Canada and Eastern Mediterranean University, Gazimagusa, Mersin 10, Turkey)

Abstract

A number of states and countries have promoted the development of a casino industry primarily to attract tourists. The policies operated have generally used regulatory or taxation instruments. Such policies may or may not lead to an efficient level of investment and production for the sector. This paper considers four alternative forms of regulatory and taxation policies and examines the interactions between these two sets of investments. The authors find that a turnover tax yields an efficient outcome with a competitive industry and also in the case of a cartel association; but it will be distortionary if a multiplant private monopoly controls the sector. Furthermore, a pure public sector-owned multiplant monopolist is efficient, while a tax on the fixed costs is inefficient if a casino association regulates the sector.

Suggested Citation

  • Hasret Benar & Glenn P. Jenkins, 2008. "The Economics of Regulation and Taxation Policies for Casino Tourism," Tourism Economics, , vol. 14(3), pages 483-510, September.
    • Handle: RePEc:sae:toueco:v:14:y:2008:i:3:p:483-510
    DOI: 10.5367/000000008785633541
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    References listed on IDEAS

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    Cited by:

    1. Iza Lejárraga & Peter Walkenhorst, 2013. "Economic policy, tourism trade and productive diversification," International Economics, CEPII research center, issue 135-136, pages 1-12.
    2. Lamia Jamel, 2020. "The Relation between Tourism and Economic Growth: A Case of Saudi Arabia as an Emerging Tourism Destination," Virtual Economics, The London Academy of Science and Business, vol. 3(4), pages 29-47, October.

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