Harvard Project Releases Study on Massachusetts Indian Gaming

Contact: Doug Gavel
Phone: 617-495-1115
Date: May 13, 2002

CAMBRIDGE, MA – Researchers from the Kennedy School's Harvard Project on American Indian Economic Development released a study today to the government of the Wampanoag Tribe of Gay Head (Aquinnah) showing that Massachusetts has much to gain and little to lose from a casino in Southeastern Massachusetts.
“With state government lotteries and major casinos in Connecticut, gaming is not new to New England. In fact, the research indicates that three-quarters of a billion dollars or more already goes to the casinos of Connecticut from Massachusetts, and a competitive casino in Bristol or Plymouth Counties would be likely to bring much of it back,” said co-author Joseph P. Kalt, Ford Foundation Professor of International Political Economy at Harvard’s John F. Kennedy School of Government. “At a time of belt-tightening for Massachusetts, it seems odd for Massachusetts to send hundreds of millions of dollars directly to another state’s businesses, workers, and state treasury.”
The study finds that the currently proposed Wampanoag facility would not only retain Massachusetts casino customers in-state, but also attract New Hampshire and Maine residents who currently pass through the Commonwealth on their way to casinos in Connecticut. It also notes that, because the Wampanoag facility is proposed for Bristol and Plymouth Counties—two counties with below-average incomes—the facility could bring greater balance to the Massachusetts economy. “A new industry bringing new jobs would help stimulate and diversify the Southeast Massachusetts economy,” said Harvard Project research fellow and co-author Kenneth W. Grant II.
The study also examines two areas of potential concern to Massachusetts policymakers: competition with the Commonwealth’s lottery and social change. It notes that the Massachusetts State Lottery’s growth continued upward through the introduction and expansion of the largest casino in the world—Foxwoods—and its neighbor, Mohegan Sun. “A scratch ticket and a night out at Foxwoods are probably not close substitutes in the consumer’s mind,” said Harvard Project research fellow and co-author Jonathan B. Taylor. “Even if there is head-to-head competition between lotteries and casinos, the Massachusetts’ lottery business has already successfully weathered that storm.”
With respect to social problems commonly attributed to gaming, the Harvard study notes that two federal government gambling commission reviews have found that pathological gambling does not rise in parallel with gambling activity. The study also reports that even though revenues expended on wagering have increased sixteen-fold and doubled as a percentage of personal income, the national lifetime gambling pathology rate has remained steady at approximately 1%. The study concludes that Massachusetts is unlikely to witness a substantial jump in social problems since gaming is so widely available to New Englanders already. “Most casino policy analyses jump straight to social costs without evaluating social benefits,” said Taylor. “When researchers have looked at both together, the evidence is clear. Casinos don’t bring socioeconomic decline, they generally bring net improvement.”
The study addressed additional concerns of state policymakers, in particular those raised in a recently re-released 1997 review by Representative Daniel E. Bosley (N. Adams). “The Bosley Memorandum appropriately highlights traffic, police, and other public infrastructure concerns,” said Kalt. “These issues are important, but they do not loom so large that Massachusetts has to reject the Wampanoag proposal—they’re the growing pains brought by the very economic vitality Southeastern Massachusetts is looking for.” The study notes that the Indian Gaming Regulatory Act, the federal legislation, that governs how Indian gaming is regulated, provides the framework for the Wampanoag Tribe and the State of Massachusetts to negotiate how these issues will be resolved.
Created in 1987, the Harvard Project on American Indian Economic Development is housed within the Kennedy School’s Malcolm Wiener Center for Social Policy. Its central activities include research on the causes and consequences of American Indian economic development, administration of an awards program that identifies excellence in tribal governance, and executive education for Native leaders and policy makers.
More information about the Project and copies of the study can be found at http://www.ksg.harvard.edu/hpaied. The authors received no compensation for any of their work on this study. Services for collection of some of the data employed in this study were provided by Lexecon Inc., with financial support to Lexecon from the government of the Wampanoag Tribe of Gay Head (Aquinnah).

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