Evidence from Indian Casinos: The Impact of Local Labor Market Conditions on the Demand for Education

May 6, 2010

William Evans, Keough-Hesburgh Professor of Economics, University of Notre Dame

Federal legislation in 1988 allowed Indian tribes to open casinos in many states and since then, nearly 400 casinos have opened. This analysis reveals the impact of local labor market conditions on the demand for education using the economic shock produced by these casino openings as the identifying event. William Evans demonstrated that the opening of a casino decreased unemployment and increased wages of low-skilled workers. However, young adults responded to this shift by dropping out of high school and reducing college enrollment rates.

Cosponsored by the Rappaport Institute for Greater Boston and the Taubman Center for State and Local Government.