Authors

Kent R. Grote

Document Type

Article

Version

Author's Final Manuscript

Publication Title

Growth and Change

Volume

45

Issue

1

First Page

121

Last Page

135

Publication Date

3-2014

Keywords

lotto, lottery, public finance, gambling

Abstract

Over the past half century, there has been an increasing prevalence of legalized gambling in the US. At the same time there is a general recognition, empirically supported in the economics literature, that spending on lottery and gaming products tends to be regressive in nature. In addition, gambling addiction is a widely acknowledged social problem. This raises the question of whether the increased presence of casinos and state lotteries results in relatively more bankruptcy filings in the states that offer them. This paper adds to the existing literature by comparing the relative impact of the presence of lotteries to that of casinos on both personal and business bankruptcies. States that adopted lotteries and casinos prior to 1995 experienced significantly higher personal bankruptcy rates while the effect of lottery and casino adoption on personal bankruptcies has disappeared since that time.

Comments

Special issue: Casinos, Gambling and Economic Development. Guest editor: Michael Wenz.

DOI

https://doi.org/10.1111/grow.12030

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