Problems in gambling research


Social Cost Pathological Gambler Crime Rate Consumer Surplus Casino Gambling 
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  1. 7.
    Heyne attributes the example to Michael Polanyi. By the way, people balance bicycles not by leaning in the opposite direction of a fall, but rather, by “[turning] the handlebars in the direction they are tipping so as to generate a centrifugal force that will offset the gravitational force pulling them down and to do this in such a manner that, for any given angle of imbalance, the curvature will be inversely proportional to the square of the cyclist’s velocity.” (Heyne 2001, p. 1)Google Scholar
  2. 8.
    See Walker and Barnett (1999) and Walker (2003) for a more detailed review of the literature on social costs.Google Scholar
  3. 9.
    These estimates are by Thompson et al. (1997) and Kindt (1995).Google Scholar
  4. 11.
    The 1997 paper is an early draft of Walker and Barnett (1999) that was presented at a conference.Google Scholar
  5. 12.
    The discussion of the Politzer et al. (1985) study in this book is in Sect. 6.5.1.Google Scholar
  6. 13.
    See Baumol and Oates (1988, pp. 29–32). The externalities issue is actually quite complicated but Grinols (2004) and Grinols and Mustard (2001) treat it as if it is very simple and straightforward.Google Scholar
  7. 14.
    Critiques include Federal Reserve (2003), Walker (2003), and Walker and Barnett (1999).Google Scholar
  8. 15.
    The studies include Politzer et al. (1985), Thompson et al. (1997), and Thompson and Quinn (2000), which have all been addressed earlier in this book. These studies or their methodologies have been criticized by the Federal Reserve (2003), NRC (1999), Walker and Barnett (1999), and Walker (2003), among others.Google Scholar
  9. 16.
    Marfels (1998, p. 416) provides a valid but brief attack on Grinols and Omorov’s interpretation of DUP activities.Google Scholar
  10. 17.
    Grinols (1997) gives the same example. He is probably the most persistent proponent of this view.Google Scholar
  11. 18.
    This passage has been cited or quoted by Grinols (1994a, p. 8; 1995a, p. 8), Grinols and Mustard (2000, p. 224), Grinols and Omorov (1996, p. 50), Kindt (1995, p. 567; 2001, p. 19), and Thompson and Schwer (2005, p. 64).Google Scholar
  12. 19.
    For a discussion specific to gambling, see ACIL (1999, pp. 60–61).Google Scholar
  13. 21.
    Tullock (1981, p. 391, note 2) explains, “Bhagwati is attempting to get the term ‘rent-seeking’ shifted to ‘directly unproductive profit seeking, DUP (pronounced dupe)’. I do not like rent-seeking as a term and would agree that this revision of the language would be an improvement, but I suspect that it is too late to make the change now.”Google Scholar
  14. 22.
    Bhagwati and Srinivasan (1982, p. 34) also make this point. Bhagwati (1982, p. 994) and Bhagwati and Srinivasan (1982) explain that in some cases DUP activities may be welfare enhancing.Google Scholar
  15. 24.
    See Albanese (1985), Curran and Scarpitti (1991), Stokowski (1996), Stitt, Giacopassi, and Nichols (2003), and Thalheimer and Ali (2004).Google Scholar
  16. 25.
    For example, a recent state-sponsored study of casino gambling in Indiana (PolicyAnalytics 2006) relied almost entirely on the Grinols and Mustard (2006) paper for its discussion of crime.Google Scholar
  17. 27.
    Grinols and Mustard (2006, p. 7, note 13) attempt to consider the issue indirectly. They analyze the crime rates in counties containing national parks and find that when population is adjusted by visitors, there is not an increase in the crime rate for park counties. Then they compare national parks to Las Vegas, for which visitor data are available. If Las Vegas and park visitors had identical propensities to commit crimes, Las Vegas would need to have 59 million visitors to account for its number of larcenies in 1994. Las Vegas had 30 million visitors. This implies that casino visitors are more likely than park visitors to commit crimes.Google Scholar
  18. 28.
    Another potential problem is that Grinols and Mustard do not account for casino size or volume. This would be related to the number of visitors to the casino county. They simply account for the opening year of the casinos. Although they note that casino profits and gross revenue are not available for Indian casinos, there are available proxies for casino volume. One such measure that is available is casino square footage (Walker and Jackson 2007a). Accounting for casino size might give a better indication of the relationship between casinos and crime.Google Scholar
  19. 29.
    Grinols and Mustard (2006, p. 14) indicate that they use the “cost per victimization figures...” This must be the higher “total cost per victimization” figure rather than “tangible costs per victimization” (Miller et al. 1996, p. 24).Google Scholar
  20. 30.
    For a discussion, see “Uncertainty of the estimates and sensitivity analysis” (Miller et al. 1996, pp. 19–23).Google Scholar
  21. 31.
    Grinols and Mustard (2006, p. 14) compare their cost estimate to that by Thompson et al. (1996). Walker and Barnett (1999) analyze the Thompson et al. study in detail and find that it greatly overestimates the social costs of gambling.Google Scholar
  22. 33.
    This discussion is adapted from Walker (2007a).Google Scholar
  23. 35.
    For example see Lancaster (1990), Hausman (1998), Hausman and Leonarad (2002), and Scherer (1979).Google Scholar
  24. 36.
    This appears to be the same discussion as in Grinols and Mustard (2001).Google Scholar

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© Springer-Verlag Berlin Heidelberg 2007

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