How the Supreme Court's Recent Decision to Allow Sports Betting Could Impact Hampton Roads
May 16, 2018
The U.S. Supreme Court recently struck down a law limiting sports betting in the United States. Now it's up to each state to decide whether to authorize it.
If Virginia approves betting on sports, don't expect much economic gain, warned James V. Koch, professor of economics and president emeritus of Old Dominion University. Instead, he foresees a "redistribution of income."
"Gambling in general has a 'close to zero' economic impact, unless it enables a city or region to attract gamblers who spend money here rather than in their home areas," Koch said. "If not, then the gambling site (riverboat, racetrack or betting parlor) gets more money and Lynnhaven Mall or Nordstrom's gets less. One can't spend the same dollar two places."
Koch has studied the potential economic impacts of casinos in Hampton Roads as part of the University's annual State of the Region reports.
He noted that although new jobs come with sports gambling, most aren't high-paying. He also warned that non-gambling jobs might be at risk "because citizens have less to spend" after betting.
Koch sees risks to the integrity of athletes If Virginia allows gambling on intercollegiate sports. "Be prepared for college players throwing games or shaving points," Koch said. "Fans in the stands frequently might be bettors and even laying bets at halftime. This would be a different world."
Still, even with the downsides, Koch fears Virginia may "end up a loser" if the state doesn't allow sports gambling.
"Surrounding states are drawing Virginians who already are spending money there -- a flow of funds out of the state that could be cured if we had gambling inside Virginia," Koch said. "Permitting gambling, then, might be a defensive economic maneuver.
"However, if all states around us also have gambling, then none of them (or us) is likely to gain. We will simply be reshuffling dollars. It's like being in the stands at a football game. If I stand up, I can see better. If everyone stands up, no one can see better."