The Swedish casino model: A comparative study of casino gaming models

Abstract

This comparative study addresses the different gaming regulations that exist around the world. The study involves seven different countries, with its center of attention on the Swedish Casino Model which is owned and operated by the Swedish Government. The study of the Casino Models that originate from each country’s gaming legislation and the influence they have worldwide, as well as how and why new Casino Gaming models are developed. Lastly, a discussion is presented on how different Casino Models can have an effect upon each other and how the Sweden Casino Model may or may not effect other nations. . The Swedish Casino 3 CHAPTER 1 INTRODUCTION Background of Study 4 Purpose of Study 5 Sub Problems 6 Contribution of Study 6 Limitations of Study 7 Methods/Organization 8 Justification 9 Definition of Terms 11 CHAPTER 2 REVIEW OF RELATED LITERATURE Introduction 13 The Basics Impacts of Gaming for a Local Economy 14 The Positive Impacts of Casino Gaming 15 The Negative Impacts of Casino Gaming 18 Gambling and the Public interest 21 Swedish State Gaming Regulation Literature 24 CHAPTER 3 – THE SWEDISH CASINO GAMING MODEL STUDY Part OneCasino Gaming Model Description 27 Austria 27 Canada 30 Great Britain 33 Macau 37 Nevada 39 Singapore 42 Part Two – The Swedish Casino Gaming Model 45 Part Three The Casino Model Graph, Findings and Conclusions 53 Part Four – Findings, Conclusions and the need for future Research 57 References 65 Tables and Figures Table 1 Summary of Casino Gaming Models 54 Graph 1 – Government Control/Ownership chart 55 The Swedish Casino 4 INTRODUCTION – CHAPTER 1 Background of the Study The gaming industry has grown very rapidly in the last two decades in Sweden, United States of America (US) and around the globe. In Sweden, the gaming market has grown 32% for the previous ten years (Statistiktabeller fran Lotteriinspektionen, 2006), from 26 billion SEK to 35.5 billion SEK. In the US, the gaming market has grown 84% from 45 billion USD to 83.7 billion USD (Industry Information, 2009) within the same period. Currently in the US, there is some form of gaming in 48 out of 50 states. In Sweden, the gaming sector has grown significantly throughout the country in the previous two decades similar to the growth worldwide which can be indicative of the social acceptance of the industry, which has made it fairly common for governments to seek other sources of revenue thus turning to the gaming industry for support. The recent senate bill in the State of Kansas is an example of the unique approach governments are taking to achieve the same results. For example, Kansas is proposing a stateowned, non Indian casino that is owned and controlled by the state, but managed by an outside entity, which is quite different from the rest of the US. Sweden on the other hand has had government controlled gaming for decades, and currently have no interest to change that model. The European Union is currently discussing and challenging the Swedish gaming model. This same discussion has been on-going for the previous ten years with no significant results or change predicted. The previously described models are simply a few of the new strategies designed to regulate and control the gaming product and revenue distribution. For decades, the US has been on the forefront of casino gaming The Swedish Casino 5 development and growth from, Las Vegas to Atlantic City, as well as the riverboat and Indian Casino expansions. In Sweden, gaming has been available for more than 300 years in many different varieties. Casino gaming products, i.e. blackjack, roulette, have been a regulatory challenge for Sweden the last 40 years. In other parts of the world, new gaming developments are being created. Governments are beginning to realize that there is money to be made outside of tax revenue. New ways of doing business and generating revenue are becoming more apparent. Even if most casinos and gaming areas appear similar, the regulations can be very different in each unique region of the world. Different styles of gaming legislation are emerging, thus creating unique variations of regulating the industry. Throughout this paper the regulatory styles will be referred to as “gaming models”. Casino operations can present many different forms of operating a successful casino business, i.e. taxation, harm minimization, number of games allowed, payouts percentages, contributions, tips, land usage, and opening times. This paper will be one of very few research cases that examine these different gaming models. The author, as a native Swede, it was appropriate to use the Swedish gaming model as a reference point, while discussing other gaming models from various regions of the world. Countries/Legislations included in this study are Sweden, Austria, Great Britain, Nevada, Macau, Canada and Singapore. Purpose of the Study The purpose of this study is to provide the reader with sufficient information to acquire a better understanding of the different casino gaming models that exist around the world. By The Swedish Casino 6 describing the Swedish gaming model and comparing it to other gaming models the readers can identify the consequences and benefits of different types of regulations, thus allowing them to make better decisions for creating or changing regulations applicable to their casino environment.