BANKRUPTCY

Research shows no cause-and-effect relationship between the growing popularity of commercial casino gaming and personal bankruptcies.

In a study requested by Congress, the U.S. Treasury Department in 1999 reported finding “no connection between state bankruptcy rates and either the extent of or introduction of casino gambling.”1 The study attributed a rising number of bankruptcies to changes in bankruptcy law, a rise in personal debt relative to income, the proliferation of credit cards and a decline in the social stigma associated with declaring bankruptcy. (Department of the Treasury, A Study of the Interaction of Gambling and Bankruptcy, delivered to Congress July 1999, p. i. This study has since been published in the Journal of Socio-Economics 31 (2002) 503–509, “The impact of gambling on personal bankruptcy rates,” Lynda de la Viña1, David Bernstein, U.S. Treasury Department.)

A 2007 study by the American Bankruptcy Institute found that the three states where casino gaming is most prevalent – Nevada, New Jersey and Mississippi – are not ranked in the top echelon in any of the categories that determine relative bankruptcy rates.  Two states that do not have casino gaming, Georgia and Tennessee, had the highest number of bankruptcies by households per consumer filing for 2007. (American Bankruptcy Institute, “Households Per Consumer Filing, Rank 2007.”)
 
A similar study completed by the University of Chicago’s National Opinion Research Center in 1999 found no greater number of bankruptcies in communities with casinos than in communities without casinos. (Information from National Opinion Research Center at the University of Chicago, Gemini Research, The Lewin Group, Gambling Impact and Behavior Study, Report to the NGISC, April 1, 1999. P. 70.)

When studies looked specifically at gaming jurisdictions, they have found the similar results.