Entry Fees as a Responsible Gambling Tool: An Economic Analysis

Entry fees or levies have received increased interest as a responsible gambling tool and have been implemented or proposed in an increasing number of jurisdictions. Using comparative statics, this study applies economic theory to understand the distributional consequences of entry fees on players with and without gambling related problems. Overall, it appears that there is relatively weak theoretical support for entry fees’ use as responsible gambling tool as they primarily distort the demand of more price sensitive recreational gamblers. This creates a potentially large dead weight loss in the economy, and likely increases the share of revenue from players with a gambling disorder

A normative analysis of gambling tax policy

This article surveys the application of normative tax theory to gambling tax policy. The analysis suggests that fixed license based taxes may be preferable to taxes on gross gaming revenue. Where output based taxes are used, the types of gambling whose demand is more price sensitive, and the types that have positive links to other industries, should be taxed at comparatively lower rates. Sin-based taxes are noted to increase economic welfare, but only when applied with a rate commensurate to harm that is external to the gambler and the operator. Finally, inter-jurisdictional competition is identified as an important consideration in tax policy and enforcement

Third-party responsible gambling accreditation programs are related to short-term improvements at casinos but no ongoing gains: Evidence from RG Check

This study examines how casino operators’ responsible gambling program performance changes after entering a third-party assurance program. Using de-identified responsible gambling accreditation data from the 75 casinos employing the “RG Check” program from 2012 to April 2019, this study finds that casino scores improved in the first reaccreditation period (p \u3c .001, d = 0.92), but failed to improve in the second reaccreditation (p \u3c .78, d = 0.38). Much of the first reaccreditation changes appear to be a result of one-time improvement in the scores of lower performing venues. There also appears to be inconsistent improvements in tactical areas of RG programs, as some areas improved over time while others were unchanged or declined. The Friedman test revealed statistically significant increases in scores for RG policies (p \u3c .001); employee training (p \u3c .001); venue/game features (p \u3c .001); and access to money (p \u3c .001). It also revealed a decrease in informed decision making scores (p = .010). The evidence is consistent with accreditation programs being used as a reputation signal rather than a performance management tool. The findings from this study suggest that RG assurance programs lead to some benefit but may not be a source of ongoing and consistent improvement without programmatic changes or other regulatory tools

The Effect of Online Gaming on Commercial Casino Revenue

This study estimates the effect of the online gaming industry on the commercial casino gaming industry. The findings from this study suggest that during the pre-UIGEA period, online gaming was a moderate substitute good for brick and mortar gaming in the U.S. During this early period in the online gaming market, which was characterized by loose regulation and relatively easy access, online gaming revenue is estimated to have cannibalized commercial casino revenue at a rate of 27 to 30 cents on the dollar. A discussion of this finding’s relevance to the current gaming market and the related policy considerations is provided. This study also led to the discovery of a seemingly valid instrumental variable, internet user rates, which can be used to correct internet gaming coefficient estimates for potential bias in future studies

The effect of casino tax policy on short-run gaming development

This study examines the effect of casino tax rate structure on investment by casino operators. Using a panel data set consisting of all states with legal commercial casino gambling from 1998 to 2009, a fixed-effect model with two-stage least squares is estimated to examine the effect of gambling taxes on firms\u27 short-run behavior. The study finds that maximum casino tax rates decrease casino employment, with an estimated average elasticity of -0.5. This result is noted to be robust to several different model specifications and data subsets. No robust relationship is found between maximum tax rates and casino wages. No significant relationship is found between effective tax rates and casino employment

Skill-based Gambling Machines: Consumer attitudes and capacity for informed choice

Abstract Skill-based gambling machines combine elements of video games (skill, social interaction, competition, achievement and progress) with the random pay-out schedule of electronic gaming machines (EGMs, slots, pokies, VLTs, FOBTS). These new machines are designed to be more engaging than traditional EGMs and specifically appeal to younger generations to address the aging EGM player base apparent in many international jurisdictions. Skill-based gambling machines are currently only legally-provided in a handful of U.S. states. International regulators have expressed concerns regarding the potential for machines to lead to harms due to players misunderstanding the extent to which skill can influence outcomes (illusions of control) and the subsequent capacity for informed consent. The extent to which consumers are interested in playing the new machines is not well understood, making their commercial viability unknown. This presentation will share research results from two empirical studies examining consumer attitudes towards skill-based gaming machines, their interest and intent to play, and the extent to which they understand the role of skill vs. chance. Participants were recruited online and from U.S. casinos which provide skill-based gaming machines and completed surveys after exposure to the machines. Implications This presentation will provide research evidence regarding two important questions for researchers, regulators, policy makers, and industry professionals about skill-based gambling machines: Who is likely to play these? And Do consumers understand how skill-based gambling machines work? Acknowledgment This research was conducted with assistance from GameCo. The efforts of Mr. Blaine Graboyes and Ms. Danielle Rosenberg to facilitate participant recruitment are greatly appreciated. Funding This work was supported by an Australian Research Council Discovery Early Career Research Award [DE1060100459] awarded to Dr. Sally Gainsbury. In-kind support for this research was provided by GameCo

Predicting Intention to Play Random and Skill-based Electronic Gambling Machines Using the Theory of Reasoned Action

Hybrid gambling machines (HGMs) are a new gambling activity that combine the skill element of traditional video games with the random pay-out schedule of electronic gaming machines (e.g., slots). Developed to increase gambling by younger generations that favor video games, there is currently no empirical evidence regarding consumer views of HGMs to guide policy-decision making related to this new gambling activity. We use the theory of reasoned action (TRA) to investigate factors that motivate intentions to play these machines in two studies: (1) among 43 casino patrons and (2) among 184 US online participants residing in states where HGMs were available. Both samples completed surveys after exposure to actual or explanations of HGMs and slots. Analyses supported the prediction that positive attitudes towards HGMs and positively perceived subjective norms would predict intention to play HGMs and slots. The results suggest that the TRA is a useful framework for explaining intentions to gamble on traditional slot machines and new HGMs. The absence of research on HGMs makes these studies an important and necessary contribution to the empirical literature on machine gambling. Understanding individuals’ intentions to engage with HGMs is important to guide development of harm-minimisation practices and evaluate impact of policy changes.This work was supported by an Australian Research Council Discovery Early Career Research Award [DE1060100459] awarded to Dr Sally Gainsbury. The funding body had no involvement in the study design, collection, analysis and interpretation of data, writing the report or decision to submit the article for publication

Measuring Responsible Gambling amongst Players: Development of the Positive Play Scale

The modern gambling industry has, by-in-large, assumed a duty of care to minimize the risks associated with gambling, which has manifested in responsible gambling (RG) programming (e.g., educating players about the odds of success). The current study fills a void in gambling operator

An Assessment of the Validity of the Gamblers Belief Questionnaire

Cognitive distortions in gambling are irrational thoughts that cause an individual to overestimate their level of control over the outcome of the game and diminish the role of chance. Due to their strong relation to gambling disorders, they are a particularly important characteristic to assess and understand in gamblers. Although numerous measures of gambling-related cognitive distortions exist, studies assessing criterion validity are scarce. In this study, we develop several tests of the Gamblers Belief Questionnaire (GBQ), a versatile and widely used scale. A sample of 184 U.S. adults was recruited through Amazon Mechanical Turk to complete an online study that included measurement of the GBQ and an assessment of the perceived role of skill and chance in various gambling and non-gambling activities. In addition to a confirmatory factor analysis of the scale, three novel validation tests were developed to understand whether the GBQ subscales can identify and discriminate measures of illusion of control and gambler's fallacy distortions. Our validation tests demonstrate that the scale does measure both distortions, providing information about gamblers' cognition that is unexplained by gambling problems, frequency of play, and demographics. Conversely, our analysis of the factor structure does not show good fit. We conclude that the GBQ measures gambling-related cognitive distortions, but there may be an opportunity to reduce the number of scale items and further refine precision of the two subscales.This work was supported by an Australian Research Council Discovery Early Career Research Award [DE1060100459] awarded to Dr. Sally Gainsbury