Supplying Slot Machines to the Poor

56 Pages Posted: 22 Sep 2015

See all articles by Melisa Bubonya

Melisa Bubonya

University of Melbourne - Melbourne Institute: Applied Economic & Social Research

David P. Byrne

University of Melbourne

Multiple version iconThere are 2 versions of this paper

Date Written: August 31, 2015

Abstract

As gambling becomes increasingly accessible both in the U.S. and worldwide, governments face an important policy question: how should they exploit the industry’s growth to raise tax revenues while protecting individuals from the detrimental effects of gambling? Using data on slot machines from the largest per-capita gambling market in the world, Australia, we estimate a structural oligopoly model to: (1) quantify firms’ incentives to make gambling accessible among socio-economically disadvantaged groups; and (2) evaluate the effect of government policy (gambling taxes, supply caps and venue smoking bans) on the distribution of slot machine supply, tax revenue and problem gambling prevalence.

Keywords: Oligopoly, taxes, smoking ban, supply caps, slot machines, problem gambling, structural estimation

JEL Classification: H71, L13, L83, L88, I31

Suggested Citation

Bubonya, Melisa and Byrne, David P., Supplying Slot Machines to the Poor (August 31, 2015). Melbourne Institute Working Paper No. 15/15, Available at SSRN: https://ssrn.com/abstract=2663807 or http://dx.doi.org/10.2139/ssrn.2663807

Melisa Bubonya

University of Melbourne - Melbourne Institute: Applied Economic & Social Research ( email )

Level 5, FBE Building, 111 Barry Street
Parkville, 3010
Australia

David P. Byrne (Contact Author)

University of Melbourne ( email )

Level 4
111 Barry Street
Melbourne, Victoria 3010
Australia

HOME PAGE: http://sites.google.com/view/dprbyrne/

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