What changes are taking place in the economies of countries after the legalization of casinos

It is not hard to figure out that casinos make a lot of money, which brings a question about why are they not legalized globally? People gamble since the dawn of time, but incorporating this business into one nations’ economy is harder than it seems. First, there has to be enough money accumulated so people can afford gambling as a pastime, and laws or legislations need to be made which regulate this area of our economy. It is no wonder that our organized gaming industry is reaching its peak right now as we live in this age of globalism and amazing technological progress. Despite all that, our question remains and we wonder how much does legalization of casinos benefits our society?

Why legalized gambling is good for Economy

• The number don’t lie

From Las Vegas strip casinos to Irish online casinos and gambling dens in Macao and Shangai, players make their bets every second of the day. More than 1.5 billion people gamble regularly and they see gambling as an integral part of their lifestyle. This accumulates around 500 billion annual worth industry that keeps growing constantly. We can only imagine the gigantic impact on this market once China decides to legalize their gambling. Many Asian countries are still reluctant to authorize gaming, but the cash opportunity is just too big to neglect.

• Creating jobs

The gaming industry creates jobs for millions of people from live casino dealers to security that handles all that money. Do not forget service providers and entertainment that goes with casinos. Programmers and game developers made online gambling what it is today, while associated services like banking systems proliferated during this expansion. Marketing experts saw an opportunity for creating a new vision regarding the American dream that features ordinary men winning jackpots or poker tournaments. This all adds up and creates a very lucrative market that keeps growing and perfecting its mechanism.

• Generating tax revenue

Tax is good for any economy so nation leaders will subsidize every business that makes a lot of money. The gambling industry provides colossal tax revenues that are used for financing every public sector of the economy. This way, casinos act like big cash registers that collect money which will be redistributed throughout the nation’s economy. This money can be used for financing public works or community development strategies. It can be pumped back into the local economy and used rationally to raise everyone’s quality of life.

• Affecting urban development

Cities that host casinos experience higher average income per capita, which is like an injection for a local economy that stimulates supply and demand of goods and services. It changes the landscape of any city completely as this industry becomes the center of attention, and everything revolves around it. New restaurants and food joints, hotels, with other forms of accommodation proliferate during this period. New construction works take place for building parks, boardwalks, and avenues, and new gas stations and supermarkets raise at every corner. New housing projects take place and the prices of condos or apartments going through the roof.

• Macroeconomic benifits

If the local community reaps some benefits from legalizing, know that the whole nation can earn a reputation of a gambling safe haven. This goes for traditional plus online casinos as from an economic standpoint, there are no differences between these two, as it all comes down to great piles of cash anyway. Redirecting that cash flow into creating a tourist destination that promises good entertainment and comfortable stay is a way to go. If our local gaming industry grew strong, export and import balance will shift depending on the nation’s fiscal or monetary policy. Favoring surplus in international trade is a common policy, but larger import signals more cash being generated with demand for luxury foreign goods.

Some doubts regarding casino legalization

• Social implications

If Ireland decided to legalize Irish casinos then you know its probably a good idea, but some concerns remain and are everpresent when the question concerning gambling legalization takes place. Authorizing casinos is often viewed as legitimizing vice, so many people are opposed to it as they fear social implications that will occur as a result. Some state that the number of gambling addicts would rise dramatically as a result and some studies show how the number of problem gamblers increases up to 10% in some areas close to the newly opened casinos.

• Inflated promises

When we talk about increased tax revenue that can be used for some greater good, many critics state how this idea is hard to implement unless the nation’s gambling industry is on a level of Las vegas or Montecarlo. Politicians love to advocate for these kinds of investments but concerns remain that casinos suck out more money out of our community than they give back in the form of big tax revenue. It is possible that this kind of discrepancy in cash flow can undermine every economic policy goals and measures. This is why legalization must be incorporated into the nation’s economic development strategy with caution.

• Creating a monopoly

When decision-makers contemplate legalizing, they do not genuinely think about creating a free market for everyone to join. They are more interested in creating a state monopoly of some sort. If a government imposes strict control on this market, it can influence the revenue stream, but this approach will suffocate any entrepreneurial spirit that drives innovations and industry’s development. That is why every public sector usually aims at attracting foreign or domestic investors with some capital to spare. Joint ventures like these would give local governments that control they crave, but would still create a stimulating environment for economic development.

Conclusion

We can debate about all pros and cons of legalizing casinos nationwide, but it all comes down to how an idea is executed. We witnessed some great success stories from Las Vegas and Atlantic City to casinos in Macao and other parts of the world. Online gambling is taking over and it generates more cash than ever. Creating reliable jurisdiction and governing bodies that license these casinos empowers some local economies. We still have to be careful and observe possible downsides so we can properly manage them in the future.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes