Does Tribal Gaming Generate Net Benefits?

Abstract

Since the late 1980s, casino-style gaming has become an increasingly popular economic development strategy for federally-recognized tribes throughout the United States. What is the net effect of tribal gaming? According to economic theory, the opening of a casino could have negative economic ramifications that offset initial improvements in employment and wages. However, my research indicates that tribal gaming is responsible for sustained improvements in employment and wages on federal reservations. These labor market gains appear to be concentrated on Indigenous people living on the host reservations. I also find evidence of rising prices on reservations that open casinos, but the average price increase is smaller than the average wage increase, suggesting that tribal gaming generates net benefits locally.