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Are There Net State Social Benefits or Costs from Legalizing Slot Machine Gambling?

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Abstract

The estimated impacts, benefits, and costs of legalizing slot machines in Maryland are analyzed. The analysis provides insight into the components and the total net benefits to the state and its citizens, the role of uncertainty, distributional impacts, and a basic tax alternative. The results forecast net benefits for Maryland both in comparison to doing nothing and in comparison to raising an equivalent amount in taxes. However, if revenue raised from the lower income population has a higher social cost, then doing nothing or raising taxes appears preferred.

Suggested Citation

  • Scott Farrow & Judith Shinogle, 2010. "Are There Net State Social Benefits or Costs from Legalizing Slot Machine Gambling?," UMBC Economics Department Working Papers 10-128, UMBC Department of Economics.
    • Handle: RePEc:umb:econwp:10128
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    File URL: http://www.umbc.edu/economics/wpapers/wp_10_128.pdf
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