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“Casinos will almost certainly increase your revenue to some extent. But there will be offsets and costs that you also need to consider,” said Alan Mallach, a visiting scholar at the Federal Reserve Bank in Philadelphia.
Among their concerns, experts said, casinos cannibalize other forms of spending from which the states take a cut, from lottery tickets to gas and consumer goods. That cancels out some of the casino states’ financial gain.
“Casino gambling does not create a single new dollar. Every dollar dropped into a slot machine is a dollar not spent on something else,” Mallach said. “It’s not like you’ve got an auto plant and you’re building cars to be shipped and sold around the world.”