Session Title

Session 2-3-D: Policy and Regulation, Part 5

Presentation Type

Paper Presentation

Location

Park MGM, Las Vegas, NV

Start Date

24-5-2023 1:30 PM

End Date

24-5-2023 3:00 PM

Disciplines

Economic Policy | Economics | Political Economy | Regional Economics

Abstract

Critics of legalization of gambling maintain that gambling revenue is at best stagnate or will eventually fall as a source of revenue. The stagnation of Lottery proceeds and casino revenue as sources of revenue seemed validate this criticism. But a new source of gambling revenue has recently been championed, namely sports gambling. So, the question this paper will attempt to answer is: Can sports gambling produce consistent and growing revenue that are needed to sustain public policy initiatives?

The legalization of sports gambling in NJ occurred on June 11th, 2018 and the first bet was placed on June 14th. New Jersey saw immense tax revenue from the legalization, and many of its neighboring states (Pennsylvania, November, 2018: New York, July, 2019) were drawn in by the appeal of legalization and the potential revenue that it creates. The issue of cannibalization of revenue when a neighboring state legalizes sports gambling will be analyzed. In order to ascertain whether New Jersey’s sports revenue suffered a cannibalization effect, various time series models will be utilized to compare the projected growth of New Jersey’s revenue to the actual revenue New Jersey had after the legalization of two competitor states, Pennsylvania and New York. The paper will also examine the growth of sports gambling in both Pennsylvania and New York.

Keywords

Sports Gambling, Revenue, Growth rates, cannibalization, competitors

Author Bios

Richard McGowan, S.J. is an Associate Professor of the Practice at the Carroll School of Management of Boston College. The focus of his research is on the interaction of the Business and Public Policy processes. Professor McGowan has published six books that focused on variety of topics that included Gambling, Tobacco, Alcohol and Marijuana. Three of these books focused on the gambling industry with the latest entitled “The Gambling Debate”.

Funding Sources

None

Competing Interests

None

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May 24th, 1:30 PM May 24th, 3:00 PM

Can Sports Gambling become the Fount of Revenue Consistency?

Park MGM, Las Vegas, NV

Critics of legalization of gambling maintain that gambling revenue is at best stagnate or will eventually fall as a source of revenue. The stagnation of Lottery proceeds and casino revenue as sources of revenue seemed validate this criticism. But a new source of gambling revenue has recently been championed, namely sports gambling. So, the question this paper will attempt to answer is: Can sports gambling produce consistent and growing revenue that are needed to sustain public policy initiatives?

The legalization of sports gambling in NJ occurred on June 11th, 2018 and the first bet was placed on June 14th. New Jersey saw immense tax revenue from the legalization, and many of its neighboring states (Pennsylvania, November, 2018: New York, July, 2019) were drawn in by the appeal of legalization and the potential revenue that it creates. The issue of cannibalization of revenue when a neighboring state legalizes sports gambling will be analyzed. In order to ascertain whether New Jersey’s sports revenue suffered a cannibalization effect, various time series models will be utilized to compare the projected growth of New Jersey’s revenue to the actual revenue New Jersey had after the legalization of two competitor states, Pennsylvania and New York. The paper will also examine the growth of sports gambling in both Pennsylvania and New York.