The Impacts of Gaming Expansion on Economic Growth: A Theoretical Reconsideration
Guoqiang Li; Xinhua Gu; Ricardo Chi Sen Siu
2009-12-11
Conference NameSymposium of the Southern Economic Journal - Gambling, Prediction Markets, and Public Policy
Source PublicationJournal of Gambling Studies
Conference DateSeptember 15-16,2008
Conference PlaceNottingham, UK
Abstract

This paper employs a general equilibrium framework to analyze the effects on economic growth of global expansions in casino gaming, which exports gambling services largely to non-residents. Both domestic and foreign investments in the gaming sector bring in not only substantial revenues but also positive spillover effects on related sectors and even on the entire local economy. However, an over-expansion of commercial gambling may lead to deterioration in the terms of trade with an adverse impact on real income. If this situation persists, it would not be impossible for immiserizing growth to occur. As a highly profitable sector, casino gaming may enable its operators to diversify out of this risk if they invest retained profits in non-gaming sectors to cash in on the spillover effects it has created. The gaming-dominant economy can then be directed on a more balanced and sustainable growth path, and will become less susceptible to business cycles. Indeed, economic experiences in the world’s major casino resorts are consistent basically with this argument for diversification. We believe that after the current global crisis fades away, economic growth and resulting surges in global demand for gambling services can provide further opportunities for the expansion of existing casino resorts and the development of new gaming markets.

KeywordGambling Services Economic Growth General Equilibrium Welfare Analysis
DOI10.1007/s10899-009-9165-5
Language英语
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Cited Times [WOS]:21   [WOS Record]     [Related Records in WOS]
Document TypeConference paper
CollectionDEPARTMENT OF FINANCE AND BUSINESS ECONOMICS
AffiliationEconomics and International Finance, Department of Finance and Business Economics, Faculty of Business Administration, University of Macau
First Author AffilicationFaculty of Business Administration
Recommended Citation
GB/T 7714
Guoqiang Li,Xinhua Gu,Ricardo Chi Sen Siu. The Impacts of Gaming Expansion on Economic Growth: A Theoretical Reconsideration[C],2009.
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