Market-based “disaster relief”: Katrina and the casino industry

Purpose – The purpose of this paper is to examine the effect the rebuilding of the casino industry has had on the recovery efforts from Katrina. Design/methodology/approach – The paper uses quarterly data from four states affected by Katrina, and a simple OLS model to test the effect the casino industry has had on personal income in the states. Findings – The paper finds that the casino industry has had a statistically significant positive impact on the economic recovery in casino states relative to non-casino states. Research limitations/implications – The paper examines a relatively short term. Other research has suggested that the long-run effects of casinos are less certain. As more data become available, the model could be re-tested. Practical implications – These results support previous evidence on a short-run economic stimulus effect from casinos. Originality/value – The paper extends previous work on the Katrina recovery by including more data, including a control sample of states without casinos, and weighting the income and revenue data