Should States Legalize Sports Betting? The Impact of the Legalization of Sports Gambling on Quarterly State Tax Revenues and the Indirect Effects Associated with Sport Industries at Large

Abstract

This paper provides a quantitative analysis of the effect of the legalization of sports betting on state tax revenue. Additionally, the research demonstrated in this discourse addresses the societal cost and benefit breakdown of sports gambling in opposition to the historical jargon that traditionally demonizes the sports betting industry. Sports wagering has been around for years but, due to the Professional and Amateur Sports Protection Act (PASPA) in 1992, the state of Nevada has been the only state where sports wagering has been legal. It was not until Murphy v. NCAA in 2018 that New Jersey joined Nevada in the legalization of sports betting. Although other states followed suit in 2018 and 2019, the data is recent making it difficult to ascertain the economic effects of legalization. Ultimately, the economic benefits of legalization will become more evident as data becomes more accessible in the coming years.