The Commission retained the New Hampshire Center for Public Policy Studies to conduct technical research and analysis for its review. Our first report, A Brief Report on Gambling in New Hampshire, was published in December, 2009.  In this second report, the Center documents the development of a series of inter-related models that analyze the impacts of expanded gambling in New Hampshire. 

The Commission requested that we develop a model that supports a “prudent calculation” of the costs and benefits of expanded gambling. Any models were to be based on an understanding of the variation in geography, size and type of expansion, and its impact on state revenues, substitution, economic development, crime, and any offsetting expenditures associated with the social or behavioral implications of expanded gambling.

Our models are based on balanced assumptions about the amount of capital investment, the size and type of facility, facility location, population and income levels, and the potential action of other states (i.e. Massachusetts) to produce a series of estimates of the revenues to the state, economic development implications, and the financial costs of social impacts associated with gambling. 

Any simulation of a complex issue, such as this one, requires significant assumptions. Whether looking at the research on market size, economic development, or problem gambling, the literature on gambling is relatively immature. Because the expansion of gambling outside of Las Vegas or Atlantic City did not occur until the mid-1990s, sufficient data to support the development of a conclusive body of evidence on expanded gambling does not exist. 

As a result, those providing estimates of the impact of expanded gambling need to acknowledge uncertainty and to explicitly note that these simulations are just as much an art as a science. Our primary goal in this work is to demonstrate the relationship between policy decisions and the potential cost-benefit of the expansion of gambling, under a set of transparent assumptions. 

• The placement of a casino in New Hampshire (or closer to New Hampshire) will increase the number of people that gamble.
• The farther individuals have to travel, the less likely they are to go to a casino in New Hampshire and vice versa. 
• The attractiveness, size and amenities – the gravity of a facility – and competition in the market affects gambling behavior.
• For a small share of the population, exposure to gambling results in pathological behavior that creates a set of social issues which – if they can be quantified -- are offsets to the potential benefits of expanded gambling.