CASINO GAMBLING AS A “GROWTH POLE” STRATEGY AND ITS EFFECT ON CRIME*

ABSTRACT Casinos are often considered as a “growth pole” strategy to revitalize dilapidated regions. However, voters often reject casinos due to their perceived adverse impact on crime. Using a quasi-experimental design we analyze the impact of the casinos on crime spillover from Atlantic City to other localities in the region. We found that the level of crime in localities adjacent to Atlantic City and along the major nontoll routes to Philadelphia and New York City up to approximately 30 miles from Atlantic City rose significantly following the introduction of casinos. Crime levels are higher than they would have been in the absence of casinos.     

SPATIAL EQUILIBRIUM WITH FOOTLOOSE FIRMS*

ABSTRACT. We determine the location equilibria in a duopoly model under a novel solution concept. Typically, spatial equilibrium is described as either a simultaneous price and location game, or else as a two-stage location-then-price game. We introduce a new alternative, a two-stage price-then-location game. It is well known that no (pure strategy) equilibrium usually exists under the two standard solution concepts when products are homogeneous. We show this is also true for the new concept. We then provide numerical results for a specific functional form (the logit model) which introduces product heterogeneity into the standard framework, restoring equilibrium when the degree of substitutability between products is not too small.