Gaming and Gambling Establishments
SIC 7993, 7999
NAICS 713120, 713990
Gambling organizations, which may include governments as well as for-profit companies, provide various means for betting or wagering money based on a chance of a winning outcome, usually in the form of a game. The most common gambling venues are lotteries, casinos, and the Internet. Certain industry firms also operate hotels and restaurants; see also the industry profiles entitled Hotels and Lodging and Restaurants.
The gambling industry includes government-run operations, such as state and national lotteries, as well as private operations such as casinos. The gambling industry continued to receive greater acceptance around the world, with most countries that had already legalized gambling permitting more operations, and with many other countries considering its legalization in order to remain competitive. In 2004, the United Kingdom remained the leading country in betting, with revenues channeled through bookmakers and permitted—while taxed and overseen—by the British government. The year 2005 was bringing major changes to the regulations governing U.K. gambling. The U.S. remained the main source of gambling dollars, particularly in the growing online gambling segment.
In the 1990s and 2000s, casinos around the world started to shift to theme-oriented gaming houses. In part, this was an effort to attract families—a move anti-gambling activists deplore out of fears that children may become gamblers later in life. Companies such as Harrah's, Mirage, Sun International, and Circus Circus led in operating theme casinos throughout the world, combining gambling with other forms of entertainment. The theme format also helped differentiate one casino from another, because most were located in gambling districts and offered otherwise similar services. In addition, more casinos relied on slot machines for their revenues, because gamblers like their easy-to-use, low-wager format. By 2004, leading manufacturers of slot machines were reporting record earnings, benefiting from both so-called cashless machines, which were rapidly replacing traditional coin-operated slots, and from relaxed laws and increased machine placement in a handful of locations.
The gambling industry comprises five main categories: parimutuel betting at race tracks, off-track betting, bingo/keno, government lotteries, and casino gambling—all of which involve chance or have odds of winning. Parimutuel betting refers to a pool of bets for racing (mostly horse or dog) where bettors on the first three winners share the prize money, minus a cut for the racing operation. Parimutuels incurred income slippage in the late 1990s and 2000s because of competition from casinos and the Internet. Off-track betting is wager by bettors who do not attend the race, but place bets through a booking agency instead. In bingo and keno, players cover the numbers on their playing cards, trying to cover five in a row and win prize money if they succeed. Government lotteries in their various kinds, including daily and weekly drawings, award monetary prizes for ticket holders who match a certain amount of numbers correctly, or otherwise purchase tickets that have the potential to result in winning, as in so-called instant lotteries. Casino gambling includes live games of chance, such as blackjack, poker, craps, and roulette, as well as machine-based betting, such as slot machines. Casino gambling accounts for the greatest share of revenues in most countries where it is legal. Casino games also give players the greatest odds of winning, while lotteries usually have the lowest odds.
Some casinos have changed drastically since their inception, moving from purely gaming houses to theme and fantasy parks and trying to cater to the family crowd. Casinos also may offer services such as child care or video arcades. Casino gambling districts and resorts are often combined with 24-hour shopping malls and visual attractions, like talking statues, erupting volcanoes, and mock ocean battles between pirate ships. Slot machines have been an increasingly popular addition to casinos. At one point, casinos devoted only around 30 percent of their space to slot machines, but by the mid- to late 1990s they began to devote as much as 90 percent of their space to these money makers.
Although some businesses and political leaders view the gambling industry as an economic panacea, or at least as an economic benefactor, industry observers and religious organizations offer a far more grim account of the industry and its effects on economies and societies. Gambling advocates often portray casinos and other gambling operations as economic stimulants that create jobs and pump more money into local and national economies. However, opponents point out that the jobs created are primarily low-skill, low-paying positions, such as money counters and janitors. Further, detractors claim that simply building casinos in declining and blighted cities has failed to revitalize them, and competition among casinos usually erodes their profits, according to the Economist.
In addition, casinos, unlike other forms of gambling such as lotteries, require peripheral services that cities usually incur, including additional law enforcement and street cleaning expenses. Moreover, some critics argue that casinos also cause a variety of social problems, such as gambling addiction, mismanagement of personal finance, and deterioration of families, creating the need for additional social services such as counseling. The cost of a casino, in terms of the problems associated with one, brings a community nearly twice the expense compared to its benefits, claims Earl L. Grinols, a University of Illinois economist who estimates the annual U.S. national loss to be US$27.5 billion.
Numerous religions forbid gambling, including Hinduism, Buddhism, Islam, and some Christian denominations. Under Islamic law, gamblers must donate their winnings to the poor, and evidence given by gamblers is not acceptable in an Islamic court. However, betting on horse racing has generally been an exception to this prohibition. Texts of Hinduism, such as the Rig Veda, ban and warn against gambling and several other sacred texts refer to it as a vice. Gamblers also cannot serve as legal witnesses under Hindu law. Buddhism views gambling as a worldly distraction that leads believers astray. Finally, Protestant denominations, as well as Mormons and Jehovah's Witnesses, also oppose gambling, considering it a sinful recreation with harmful social and economic consequences. Other churches, such as the Catholic Church, have long supported bingo and gaming wheels at church functions, such as lawn fetes.
In 2005, gambling remained highly regulated in most countries in which it was legal, with participating governments earning large amounts of money from the industry. However, online gambling, which easily crosses borders was proving more difficult to regulate. In the United States, providing online gaming remained illegal, however the government was not taking action against foreign-based companies doing such business with Americans.
Cultures throughout the ages have gambled through lotteries and other games of chance, and ancient texts and artifacts from many cultures all over the world refer to gambling and games of chance. For example, the ancient Romans gambled for entertainment, and medieval Europeans instituted gambling as a recreation for festivals. Gambling in China dates back about 4,000 years, and excavations at Ur, Crete, India, and Egypt (2000-1000 B.C.) showed signs of gambling in these cultures, because dice and gambling boards were found. Later in Europe, feudal rulers and merchants relied on gambling for revenues. During the sixteenth century, European governments became particularly interested in gambling for income, and many began to require licensing from the crown and established government monopolies over the industry. England, for example, would issue licenses for gambling operations in England and the country's colonies, and the government operated its own lotteries from 1709 until 1826, when it was banned.
In the eighteenth century, European aristocracy enjoyed gambling in the resorts of Europe, although European governments officially opposed gambling, and some countries outlawed it. With the rise of the middle-income merchant class, Europe began to establish permanent gambling venues throughout the continent, including Baden-Baden and Wiesbaden, Germany, and Baden, Austria. Moreover, the Casino de Monte Carlo became a model for casinos throughout Europe, which continued to spread through the nineteenth century.
The U.S. gambling and casino industry grew out of the westward migration of pioneers, who shunned the puritanical ways of some of the eastern cities and states. With few other forms of entertainment available, many of these U.S. settlers chose gambling as a key leisure activity. Between 1800 an 1840, towns along the Mississippi River became ports for the riverboats transporting goods and people. The riverboats also became moving gambling parlors. Further west, in the mining camps and small towns, public, organized systems of gambling were evolving. Most of the gambling involved card games, such as Monte and Poker, but some...
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