Problem Gambling and Gaming Machine Density: Socio-spatial Analysis of Three Victorian Localities

Abstract

This paper examines the debate about possible relationships between problem gambling and accessibility to electronic gaming machines (EGMs), in the context of the Victorian Government's policy that imposed a ‘cap’ on EGMs in disadvantaged communities. Using GIS (Geographical Information Systems), the spatial distribution of social disadvantage in three ‘capped’ localities was compared with the spatial distribution of gaming venues and patterns of concentrated EGM expenditure during 2001–2005, including seasonal trends. Research revealed different relationships between spatial and social categories in the study localities, indicating the need for more systematic local area analysis. This research raises questions about the limitations of conventional methodologies and regulatory strategies based on simple measures such as gaming machine density. We propose improvements to the methodology to better measure the changing level of local supply and demand for machine gaming.

Acknowledgements

This research was conducted with support from the Office of Gaming and Racing, Department of Justice, Victorian Government that provided financial support and data to enable the research to take place. We particularly thank the two anonymous referees and editor who provided constructive comments on our draft manuscript.

Notes

1. A statewide cap of 27,000 EGMs has been established for club and hotel gaming in Victoria; Melbourne's Crown Casino is permitted to operate a further 2,500 EGMs.

2. Since 1992 Victorian gaming clubs and hotels have been permitted a maximum of 105 EGMs.

3. The Commission operates as a quasi-judicial body similar to a licensing court. This legalistic and public procedure contrasts with the Queensland framework where the Gaming Commission considers applications in closed session without cross-examination. Compared to their Victorian counterpart, the Queensland Gaming Commission also has had more extensive discretionary powers (McMillen and Masterman-Smith, 2001).

4. Expenditure in this paper refers to the net amount lost by gamblers (the amount staked less their winnings).

5. The VLGA recommends that an additional weighting factor be applied to the Government's current formula for ceiling density in areas that are above the state's average on the SEIFA index: i.e. seven ± 0.35 EGMs per 1,000 adults.

6. EGM expenditure is the net amount lost by gamblers on gaming machines (the amount staked less their winnings).

7. All dollar signs ($) in this paper refer to Australian dollars (Aus$).

8. Since 2001 the Queensland Gaming Commission has published and updated guidelines for applicants to inform them of the issues to be addressed in their required Community Impact Statements (http://qogr.qld.gov.au).