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All in: An empirical analysis of legislative voting on internet gambling restrictions in the United States
Abstract
In 2006, the U.S. Congress passed the Unlawful Internet Gambling Enforcement Act (UIGEA) which prohibited financial institutions from processing transactions arising from online gaming activities, thereby severely hindering U.S. residents from participating in online casino games, primarily poker. Enactment of this legislation followed lobbying and political pressure from a variety of interest groups. By examining House roll call votes, we identify empirically the sources of political influence that resulted in passage of the internet gambling legislation. We find that party affiliation was of primary importance, with Republicans more likely to vote in favor of the bill. The percentage of constituents who are Evangelical Christians and also the number of gambling establishments in the district were positively associated with votes for the bill. However, contributions from the gaming industry decreased the probability a congressman would vote for the bill. (JEL D72, L83)
... Much of the research on legislator voting behavior originates from political science, where the main focus lies in finding a link between ideological variables and roll-call voting choices (Becher et al., 2016;Cox and Poole, 2002;Fleisher, 1993;Poole and Rosenthal, 2001;Snyder and Groseclose, 2000). More recently, economists have also begun exploring legislative voting behavior towards the purpose of understanding what drives policy reforms (Facchini and Steinhardt, 2011;Conconi et al., 2012;Bouton et al., 2014;Halcoussis and Lowenberg, 2015;Facchini et al., 2016). These studies, however, explore legislator behavior at the federal level, that is, roll-call voting in the US Congress. ...
This paper investigates how upward mobility affects legislator voting behavior towards education policies. We develop an electoral competition model where voters are altruistic parents and politicians are office seeking. In this setting the future economic status of the children is affected both by current public education spending and by the level of upward mobility. Using a newly compiled dataset of roll call voting on California education legislation matched with electoral district-level upward mobility we find that the likelihood of a legislator voting "no" on redistributive education bills decreases by 10 percentage points when upward mobility in his electoral district decreases by a standard deviation.
A vast literature has examined how perceptions of mobility shape demand for redistribution. These studies generally refer to contemporaneous tax policies demanded by those directly impacted. But social mobility is often measured as changes across generations. To account for these intergenerational effects, our analysis focuses on educational policies. We examine how social mobility at the district level explains legislative support for inclusive education policies. We first develop an electoral competition model where voters are altruistic parents, politicians are office seeking and the future economic status of the children is affected both by the degree of income mobility and by public education policies. We then analyze a newly compiled dataset of roll-call votes on California education legislation matched with electoral district levels of income mobility. In line with the model, our analysis suggests that upward mobility in a district negatively predicts legislative support for redistributive education bills.
Legalized gambling is an attractive option to state governments facing tightening fiscal constraints. Yet, the empirical evidence on the effect of gambling on state revenues is limited. Most studies examine a single industry in a single state, and for a relatively short period of time. This study provides a more general analysis of gambling industries and their effects on state revenues. We use data on gambling volume and state government revenues net of federal government transfers for all 50 states from 1985 to 2000. We find that lotteries and horse racing tend to increase state revenues, while casinos and greyhound racing tend to decrease state revenues.
The United States is the largest contributor to the International Monetary Fund (IMF) and the World Bank, providing resources
in exchange for voting power in these international financial institutions (IFIs). While the Treasury Department manages the
day-to-day aspects of US participation in these institutions, Congress retains authority on funding. With the aim of understanding
the microincentives of US support for the IFIs, I analyze congressional voting on bills to fund the IFIs. I argue that members
of congress are more likely to support a funding increase (1) the more “liberal” their ideology, (2) the larger the share
of campaign contributions they get from banks that specialize in international lending, and (3) the larger the share of voters
that gain from economic globalization that reside in their districts. Statistical analyses of voting on five IFI funding bills
since 1977 provide support for these arguments.
The adoption of lotteries by state governments has received significant attention in the economics literature, but the issue
of casino adoption has been neglected by researchers. Casino gambling is a relatively new industry in the United States, outside
Nevada and New Jersey. As of 2007, 11 states had established commercial casinos; several more states are considering legalization.
We analyze the factors that determine a state’s decision to legalize commercial casinos, using data from 1985 to 2000, a period
which covers the majority of states that have adopted commercial casinos. We use a tobit model to examine states’ fiscal conditions,
political alignments, intrastate and interstate competitive environments, and demographic characteristics, which yields information
on the probability and timing of adoptions. The results suggest a public choice explanation that casino legalization is due
to state fiscal stress, to efforts to keep gambling revenues (and the concomitant gambling taxes) within the state, and to
attract tourism or “export taxes.”
"We apply a novel daily time series data set of daily turnover from one of Britain's leading bookmakers to analyze potential substitution between lottery play and bookmaker betting. We find some evidence that bettors do substitute away from horse race, soccer and numbers betting when the effective price of lottery tickets is unusually low, that is, when there is a rollover or other special draw. This substitution has a highly specific pattern of timing that varies by sector. Our results further suggest that bettors rationally engage in forward-looking substitution within their betting portfolios". ("JEL" D12, L83) Copyright (c) 2008 Western Economic Association International.
On December 8, 1993 President Bill Clinton signed into law the North American Free Trade Agreement and in doing so he brought to a close the lengthy political process that produced the trade agreement. This paper combines information for individual legislators with state-level economic data to conduct an empirical analysis of the House and Senate voting patterns on NAFTA. Results from the logit model estimation confirm that expected job gains/ losses, the presence of organized labor and political ideology (as represented by political party) were significant predictors of a legislator's vote on NAFTA. In addition, the expected impact of NAFTA on the environment was found to be somewhat important in explaining Congressional voting patterns for a free trade agreement with Mexico.
Although the use of discrete choice models (particularly the probit model) is widely taught, it is the method rather than the interpretation of results that is emphasized. This article provides a graphical technique for interpretation that will be useful in statistics and econometrics courses.
Washington’s remedy to the financial problems that began in 2008 was the Troubled Asset Relief Program (TARP) — the so called bailout of the banking system. Whatever its merits, it was, for the most part, unpopular with the American public. Lawmakers, fearful that the economy might actually collapse without some action, were likewise fearful that action — in the form of a payout to the Wall Street financiers — would prove to be harmful to them at the polls. Thus, politicians sought to assure the public that their vote on the measure would reflect Main Street virtues, not Wall Street greed. Members of Congress, addressing the public’s misgivings about the bailout, asserted that they were wrestling with difficult issues such as fairness and equity, banking regulation, executive pay, job losses, moral hazard, 401(k) values, and the proper role of the state. Furthermore, they argued, these complex issues were difficult for the public to understand, and legislators, vigilant in carrying out their duty, were weighing the pros and the cons in order to cast a vote that was in the best interest of the nation. But it turns out that when one moves beyond the speeches, the underlying motivation behind most votes cast was hardly complex and actually quite simple. In this article, we construct a model to analyze the bailout vote of each legislator. A simple reelection model of legislator behavior explains a majority of the votes taken either for or against the measure from politician to politician.
In determining the legality of online poker – a multibillion dollar industry – courts have relied heavily on the issue of whether or not poker is a game of skill. Using newly available data, we analyze that question by examining the performance in the 2010 World Series of Poker of a group of poker players identified as being highly skilled prior to the start of the events. Those players identified a priori as being highly skilled achieved an average return on investment of over 30 percent, compared to a -15 percent for all other players. This large gap in returns is strong evidence in support of the idea that poker is a game of skill.Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.
On December 8, 1993 President Bill Clinton signed into law the North American Free Trade Agreement and in doing so he brought to a close the lengthy political process that produced the trade agreement. This paper combines information for individual legislators with state-level economic data to conduct an empirical analysis of the House and Senate voting patterns on NAFTA. Results from the logit model estimation confirm that expected job gains/losses, the presence of organized labor and political ideology (as represented by political party) were significant predictors of a legislator's vote on NAFTA. In addition, the expected impact of NAFTA on the environment was found to be somewhat important in explaining Congressional voting patterns for a free trade agreement with Mexico.
This paper empirically investigates the institutional determinants of whether a tribal government invests in a casino. I find that the presence of Indian casinos is strongly related to plausibly exogenous variation in reservations’ legal and political institutions. Tribal governments that can negotiate gaming compacts with multiple state governments, because tribal lands span state borders, had more than twice the estimated probability (.77 versus .32) of operating an Indian casino in 1999. Tribal governments of reservations where contracts are adjudicated in state courts, rather than tribal courts, have more than twice the estimated probability (.76 versus .34) of investing in an Indian casino, ceteris paribus. These findings suggest that states’ political pressures and predictable judiciaries affect incentives to invest in casinos. This study contributes, more generally, to the empirical literature on the effects of institutions by providing new evidence that low-cost contracting is important for taking advantage of substantial investment opportunities.
Immigration is today one of the most hotly debated policy issues in the United States. Despite marked divergence of opinion even within political parties, several important reforms have been introduced in the post 1965 era. The purpose of this paper is to carry out a systematic analysis of the drivers of the voting behavior of US representatives on immigration policy in the period 1970-2006, and in particular to assess the role of economic factors at the district level. Our findings suggest that representatives from more skilled labor abundant districts are more likely to support an open immigration policy towards the unskilled, whereas the opposite is true for representatives from more unskilled labor abundant districts. This evidence is robust to the introduction of an array of additional economic and non-economic characteristics of the districts, and suggests that a simple factor analysis model can go a long way in explaining voting on immigration policy.
This paper examines the determinants of Congressional voting on CAFTA, focusing on environmental lobbying. Empirical results indicate that the environment was in fact not a major point of contention during the CAFTA vote. Campaign contributions were, however, an important factor in determining the vote. Indeed, with no contributions from labor or business, the CAFTA would not have passed. Employment in the sensitive sectors of CAFTA, sugar and textiles, were also critical in affecting the vote. An unanticipated result in this analysis was the effect of income on the CAFTA vote - poorer districts favored the agreement.
We consider games of chance between two players: Player M can win only by amassing point totals in several categories before
player N scores a prescribed total number n of points. Let M have k objectives, with m
i
points required in category i and probability q
i
of scoring a point in that category. We resolve certain special cases:
(a) For all m
i
equal, the probabilities of M winning are ordered by majorization of the vectors (q
1,...,q
k
).
(b) For all q
i
equal, the probabilities of M winning are ordered by majorization of the vectors (m
1,...,m
k
).
(c) For all m
i
equal and all q
i
equal, the probability of M winning approaches 0 as n → ∞ or as k → ∞. The results, which follow from inequalities of majorization and Schur convexity, are in accord with intuition.
An interesting aspect of games is the relative extent to which a player can positively influence his results by making appropriate strategic choices. This question is closely related to the issue of how to distinguish between games of skill and games of chance. The distinction between these two types of games is definitely interesting from a juridical point of view.
In this paper we present a modification of an existing measure of the skill level of a game, which has served as a juridical tool for the classification of games. The main difference is that this new definition does not automatically classify incomplete information games without chance moves as games of skill. Copyright © 2004 John Wiley & Sons, Ltd.
We provide conditions under which a casino resort enjoys an increase in demand following the entry of a riverboat casino in a separate geographical market. Gambling is modeled as an 'experience good', whereby consumers are uncertain of the benefit they will receive from the activity prior to engaging in it. The riverboat casino provides nearby consumers with the opportunity to experience gambling without having to incur large transportation costs. Those consumers who discover that they enjoy gambling travel to the casino resort for a vacation next period. Our theoretical results are supported by empirical evidence for casinos in Las Vegas. Copyright © 2001 John Wiley & Sons, Ltd.
This paper presents an interest group model of gambling regulation and applies it to major changes in the regulation of US gambling markets. Gambling markets are among the most restricted and politicized markets in the American economy, yet economists interested in the economics of regulation have paid them little attention. Applying the economic theory of regulation to gambling markets can lead to greater understanding of current public policy. In addition, this application may shed light on the discipline itself, as to its ability to explain recurrent fluctuations in the extent of regulatory intervention over long periods of time. Broadly speaking, the interest group model is consistent with changes in the extent of regulation, including the recent period of liberalization and consequent growth in gambling. Copyright © 2001 John Wiley & Sons, Ltd.
Between 1990 and 1995, twenty-three states unilaterally imposed term limits on their own delegations to Congress. In 1995 the House of Representatives defeated a constitutional amendment that would have limited the terms for all of Congress. Only weeks later, the Supreme Court struck down the individual state laws. In 1997 the House again brought the issue to a vote, which also failed. This paper models congressional voting on term limits with a simple game within an interest-group theory with legislators as imperfect agents of constituents. The game foremost predicts that members from term-limited states would be more likely to support term limits in the first vote but no more likely on the second vote. The empirical section employs probit, multinomial logit, and ordered probit maximum likelihood estimations to confirm the stated hypotheses. Among other results, in particular both the joint and conditional probability of a "yea" on the first vote and a subsequent "nay" on the second vote is higher for members from states that had unilaterally self-imposed term limits. The results are robust to model specification, estimator, and alternative sampling. Implications are proposed in the concluding comments. Copyright 2002 by Kluwer Academic Publishers
This study investigates some of the macro-determinants of commercial gambling in 21 industrialized nations. Of the possible economic determinants, two seem particularly important: the per capita income of the country since gambling represents a larger share of the income of low-income people than high-income people; and the general uncertainty of the economic environment, as measured by annual fluctuations in the GDP. Of the possible cultural determines, two also seem particularly important: the values held by the population, as measured by a factor analysis of a number of questions from the World Value Study; and the degree to which the society insures against risk through social welfare expenditures. For the OECD nations in the early part of the 21-super-st century, all four variables prove to be significantly related to the ratio of gambling expenditures to disposable income. Copyright 2008 Blackwell Publishing Ltd..
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