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Do urban casinos affect nearby neighbourhoods? Evidence from Canada

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  • Haifang Huang
  • Brad R. Humphreys
  • Li Zhou

Abstract

We analyse the effect of new casinos on nearby neighbourhoods using data from casinos opened in Canada between 1986−2007. We find no evidence linking casino openings to nearby population growth or changes in residents' income, composition by age, gender, marital status, and home ownership status. We find evidence of negative casino effects on the growth of housing values and rent. The effect is substantial near casinos, a nearly 8 percentage‐point loss in the growth of home values over 5 years, but has limited influence and dissipates quickly over distance. The estimated effect on housing rents is comparable in terms of standard deviation. Se analiza el efecto de los nuevos casinos en los vecindarios cercanos utilizando datos de casinos abiertos en Canadá entre 1986 y 2007. No se encontró evidencia que vincule la apertura de casinos con el crecimiento de la población en los alrededores o cambios en los ingresos de los residentes, o en la composición por edad, género, estado civil o estado de propiedad de la vivienda. Se encontró evidencia de los efectos negativos de los casinos en el crecimiento del valor de las viviendas y de los alquileres. El efecto es sustancial cerca de los casinos, con una pérdida de casi 8 puntos porcentuales en el crecimiento del valor de la vivienda en 5 años, pero su influencia es limitada y se disipa rápidamente con la distancia. El efecto estimado sobre los alquileres de las viviendas es comparable en términos de desviación estándar. 本稿では、1986年から2007年にカナダで開業したカジノのデータを使用して、新規開業したカジノが近隣地域に及ぼす効果を分析する。結果からは、近隣地域の人口増加、または、住民の所得、年齢、性別、配偶者の有無、持ち家世帯の比率などの変化に、カジノの開業に関連するエビデンスは認められなかった。住宅価格及び賃貸料の上昇に対するカジノの負の効果を示すエビデンスが認められた。その効果は、カジノの近隣では頑健であり、5年間での住宅価格の上昇に8%近い損失が認められるが、影響が及ぶ範囲は限定的で遠隔的に速く分散する。家賃に対する推定の効果は、標準偏差でほぼ同等である。

Suggested Citation

  • Haifang Huang & Brad R. Humphreys & Li Zhou, 2018. "Do urban casinos affect nearby neighbourhoods? Evidence from Canada," Papers in Regional Science, Wiley Blackwell, vol. 97(3), pages 757-784, August.
    • Handle: RePEc:bla:presci:v:97:y:2018:i:3:p:757-784
    DOI: 10.1111/pirs.12277
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    References listed on IDEAS

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    Cited by:

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    3. Huang, Haifang & Humphreys, Brad & Zhou, Li, 2014. "Urban Casinos and Local Housing Markets: Evidence from the US," Working Papers 2014-4, University of Alberta, Department of Economics.
    4. Erasmo Giambona & Rafael P. Ribas, 2023. "The external cost of prostitution: Evidence from shutting down red light districts in the Netherlands," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 51(3), pages 630-654, May.

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    More about this item

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets

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