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Has Riverboat Gambling Reduced State Lottery Revenue?

Author

Listed:
  • Donald S. Elliott

    (Southern Illinois University Edwardsville)

  • John C. Navin

    (Southern Illinois University Edwardsville)

Abstract

Over the past decade, most states have introduced lotteries, and many now license casinos. To what extent does the presence of licensed casinos cannibalize revenues from state-sponsored lotteries? To what extent does pari-mutuel betting cannibalize revenues from state-sponsored lotteries? Based on pooled cross-section data for the period from 1989 to 1995, this research reveals significant cannibalization of lottery revenues by both casinos and pari-mutuel betting. Nevertheless, states, in general, gain by having both lotteries and casinos. In the case of pari-mutuel betting, however, the substitution is so severe that, at existing effective tax rates, lost lottery revenues outweigh states’ receipts from pari-mutuel betting.

Suggested Citation

  • Donald S. Elliott & John C. Navin, 2002. "Has Riverboat Gambling Reduced State Lottery Revenue?," Public Finance Review, , vol. 30(3), pages 235-247, May.
  • Handle: RePEc:sae:pubfin:v:30:y:2002:i:3:p:235-247
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    Citations

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    Cited by:

    1. Jonathan Rork & Stephen Fink, 2003. "The Importance of Self-Selection in Casino Cannibalization of State Lotteries," Economics Bulletin, AccessEcon, vol. 8(10), pages 1-8.
    2. Douglas M. Walker & Todd M. Nesbit, 2014. "Casino Revenue Sensitivity to Competing Casinos: A Spatial Analysis of Missouri," Growth and Change, Wiley Blackwell, vol. 45(1), pages 21-40, March.
    3. repec:ebl:ecbull:v:8:y:2003:i:10:p:1-8 is not listed on IDEAS
    4. Nichols, Mark W. & Tosun, Mehmet Serkan, 2017. "The impact of legalized casino gambling on crime," Regional Science and Urban Economics, Elsevier, vol. 66(C), pages 1-15.
    5. Kent Grote & Victor Matheson, 2011. "The Economics of Lotteries: An Annotated Bibliography," Working Papers 1110, College of the Holy Cross, Department of Economics.
    6. Skidmore, Mark & Serkan Tosun, Mehmet, 2008. "Do New Lottery Games Stimulate Retail Activity? Evidence from West Virginia Counties," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 38(1).
    7. Garrett, Thomas A. & Coughlin, Cletus C., 2009. "Inter–Temporal Differences in the Income Elasticity of Demand for Lottery Tickets," National Tax Journal, National Tax Association;National Tax Journal, vol. 62(1), pages 77-99, March.
    8. Melissa S. Kearney, 2005. "The Economic Winners and Losers of Legalized Gambling," NBER Working Papers 11234, National Bureau of Economic Research, Inc.
    9. Kent Grote & Victor Matheson, 2011. "The Economics of Lotteries: A Survey of the Literature," Working Papers 1109, College of the Holy Cross, Department of Economics.
    10. Brown, Ryan P. & Rork, Jonathan C., 2005. "Copycat gaming: A spatial analysis of state lottery structure," Regional Science and Urban Economics, Elsevier, vol. 35(6), pages 795-807, November.
    11. Andrés Leal & Julio López-Laborda & Fernando Rodrigo, 2014. "The Inside and Outside Revenue Impact of Regional Gambling Taxes in Spain," Growth and Change, Wiley Blackwell, vol. 45(1), pages 79-97, March.
    12. Cotti, Chad D. & Walker, Douglas M., 2010. "The impact of casinos on fatal alcohol-related traffic accidents in the United States," Journal of Health Economics, Elsevier, vol. 29(6), pages 788-796, December.
    13. repec:bla:coecpo:v:35:y:2017:i:4:p:684-699 is not listed on IDEAS

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