Pros and Cons of Building a Casino in Your Neighborhood

Topics: Casino, Economics, Costs Pages: 6 (1393 words) Published: November 29, 2010
• New Jobs

• Entertainment

• Expand Tourism

• Contribution to Community

• Contribution to Charitable Organizations

• Lower taxes for Residents

• Tax Revenues

• Higher Wages

• Higher Property Value

• Extends Visitors Stay in Area

• Money put back into Local Economy

• Adds to a City

• Attracts People

• Traffic of People – Better Known

• Street Crime

• Prostitution

• Takes from Local businesses

• No New Businesses

• Erosion of Work Ethic

• Pathological Gamblers

• Increased Bankruptcy Rates

• Preys on Poor and Elderly

• Lost Productivity

• Traffic Congestion

• Entry Level Jobs – Low Paying

• Reality Money not re-spent in Local Economy

• No Taxes

• Environmental Effects

Three essential conditions must be simultaneously satisfied if a particular cost is to be classified as a private cost: 1. Gamblers must be fully informed

2. Gamblers must be rational

3. Gamblers must be required to bear the total costs of their gambling

If any one of these conditions fails to be satisfied, an element of social costs exists. For example, if gamblers cease work in order to gamble and gamble away their family assets, leaving their families to claim social welfare benefits, the rest of the community is bearing social casts. The gamblers may have mad rational decisions in that they know that the community will provide a safety net. They might have made different decisions had the safety net not existed.

One distinction that must be made is between real and pecuniary costs. Real costs represent a withdrawal of resources from other potential uses- they represent a subtraction from society’s total welfare. Pecuniary costs represent costs borne by some members of the community but which are exactly matched by benefits received by others. For example, assume that gambling increases levels of corruption in the public and private sectors. Corruption can have both pecuniary and real effects. It can produce a redistribution of income, which is a pecuniary effect. It can also produce a real deterioration in efficiency as productive resources are allocated according to sub-optimal, non-economic criteria.

Generally speaking, when identifying the real costs, we can classify the costs and benefits on gambling into two categories- tangible and intangible. Tangible costs are costs that can be valued in the marketplace. Any reduction in these costs will yield resources that will become available to the community for consumption or investment purposes. Intangible costs are costs that cannot be readily valued in the marketplace and which, when reduced, will not yield resources to the community for consumption or investment purposes.

Examples of both tangible and intangible costs of gambling: Tangible
Productionreduced on the job productivity
Reduced workforce
Reduced unpaid household services
Heath and Counselingpsychological treatment of gamblers
Treatment of families of gamblers
Treatment of victims of crime attributable to gambling
Judicial systems
Penal systems
Insurance administration
Regulationregulation supervision
Regulatory programs
PreventionCrime prevention

Loss of life
Quality of life
Cultural impacts
Stress to crime victims
Stress to gamblers and others

The purpose of this paper is to assess the economic impacts of Casino gambling within a community. The Seneca Indian Tribe opened a temporary casino on its land in Buffalo after federal approval, to satisfy its agreement with the state. The majority of the community are now turning their heads and not showing interest for the casino. They believe the...
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