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Crime and Gaming Machine Expenditure

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Crime and Gaming Machine Expenditure This study was funded through the Community Support Fund as part of the pilot round - Submission Based Grants System for Gambling Research - a commitment under Taking Action on Problem Gambling: A strategy for combating problem gambling in Victoria, under Action Area 7: Fostering Gambling Research. This study investigates the relationship between gaming expenditure and crime in Victoria (especially income-generating crime - theft, fraud, break and enter, forgery, false pretences, larceny and robbery). This research involved an extensive literature review and developed complex databases to model the relationship between crime and its various influences across three years in Victoria: 1996, 2001 and 2006. Authors: Sarah Wheeler, David Round, John Wilson, Centre for Regulation and Market Analysis, School of Commerce © Copyright: University of South Australia, South Australia This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968. Disclaimer: The opinions, findings and proposals contained in this report represent the views of the author and do not necessarily represent the attitudes or opinions of the Department of Justice, State of Victoria. No warranty is given as to the accuracy of the information and if you rely on it, you do so at your own risk. The Department of Justice specifically excludes any liability for any error or inaccuracy in, or omissions from, this document and any loss or damage that you or any other person may suffer. For further information or additional copies contact: Office of Gaming and Racing PO Box 18055 Melbourne VIC 8003 Tel: 03 8684 1910 Fax: 03 8684 1900 Email: [email protected] Also published at www.justice.vic.gov.au Authorised by the Victorian Government, 121 Exhibition St, Melbourne, 3000 ISBN: 978-1-921627-22-4 If you would like to receive this publication in an accessible format, such as large print or audio, please email [email protected] THE RELATIONSHIP BETWEEN CRIME AND GAMING EXPENDITURE IN VICTORIA FINAL REPORT JUNE 2010 by Dr Sarah Wheeler, Professor David K Round and Dr John K Wilson Centre for Regulation and Market Analysis, School of Commerce, University of South Australia The Relationship between Crime and Gaming Expenditure in Victoria CONTENTS LIST OF TABLES....................................................................................................... iii LIST OF FIGURES ..................................................................................................... iii EXECUTIVE SUMMARY ..........................................................................................iv 1. INTRODUCTION .................................................................................................1 1.1 Background....................................................................................................1 1.2 Problem Gambling.........................................................................................4 1.2.1 Profile of a Problem Gambler ...............................................................5 1.2.2 Consequences of Problem Gambling.....................................................7 1.2.3 The Theoretical Relationship between Gambling and Criminal Activity 10 2. CRIME AND GAMBLING BEHAVOUR .........................................................12 2.1 Various Types of Crimes Associated with Gambling..................................12 2.1.1 Organised Crime Links........................................................................12 2.1.2 Other Crime Links................................................................................13 2.2 Crimes Associated with Problem Gambling................................................13 2.2.1 Self-Reporting and Legal Studies of the Link between Problem Gambling and Crime............................................................................................14 2.2.1.1 Profile of a Gambling Offender ...........................................................18 2.2.2 International Community Model Studies of the Link between Problem Gambling and Crime............................................................................................19 2.2.3 Australian Community Model Studies of the Link between Problem Gambling and Crime............................................................................................21 2.2.4 Other Studies of the Link between Problem Gambling and Crime......22 2.2.5 Under-reporting Issues with Problem Gambling and Crime ..............23 2.2.6 Summary ..............................................................................................24 3. OTHER FACTORS INFLUENCING CRIME....................................................25 3.1 Income..........................................................................................................25 3.2 Age...............................................................................................................26 3.3 Ethnicity.......................................................................................................26 3.4 Alcohol.........................................................................................................27 3.5 Drugs............................................................................................................28 3.6 Gender..........................................................................................................28 3.7 Unemployment.............................................................................................28 3.8 Child Maltreatment ......................................................................................30 3.9 Marital/Family Status...................................................................................30 3.10 Enforcement Mechanisms............................................................................30 3.11 Education .....................................................................................................32 3.12 Area..............................................................................................................32 3.13 Previous and Surrounding Crime Rates.......................................................33 3.14 Summary......................................................................................................33 4. METHODOLOGY ..............................................................................................34 4.1 Analytical Methodology ..............................................................................35 4.1.1 Endogeneity Issues...............................................................................36 4.1.2 Spatial Dependence .............................................................................37 4.2 Data Issues and Sources...............................................................................39 4.2.1 Offence data .........................................................................................41 Centre for Regulation and Market Analysis, University of South Australia i The Relationship between Crime and Gaming Expenditure in Victoria 4.2.2 Gaming data.........................................................................................43 4.3 Empirical Results.........................................................................................45 4.3.1 Modelling Issues ..................................................................................45 4.3.1 Summary of Key Results .............................................................................51 5. DISCUSSION......................................................................................................58 5.1 Gaming Expenditure and Drug Offences - Discussion................................58 5.2 Discussion of Other Variables .....................................................................62 6. CONCLUSION....................................................................................................65 REFERENCES ............................................................................................................67 APPENDIX 1...............................................................................................................72 Centre for Regulation and Market Analysis, University of South Australia ii The Relationship between Crime and Gaming Expenditure in Victoria LIST OF TABLES Table 1 Household Expenditure Survey: Average Weekly Expenditure on Gambling ($) Selected States and Australia – 2003-04 2 Table 2 Studies into the Relationship between Gambling & Crime in Australia 17 Table 3 Classification of Victorian Offences into Income- or Non-Income- Generating 43 Table 4 Victorian Gaming Profile from 2000 to 2008 44 Table 5 Variable Description of the final models 45 Table 6 Summary for spatial dependence and endogeneity tests and the final model used 49 Table 7 Various Influences on Income- and Non-Income-Generating Crimes in Victoria in 2006 52 Table 8 Various Influences on Income- and Non-Income-Generating Crimes in Victoria in 2001 53 Table 9 Various Influences on Income- and Non-Income-Generating Crimes in Victoria in 1996 55 LIST OF FIGURES Figure 1 Potential Impacts of Problem Gambling 8 Figure 2 Pathways and Problem Gambling’s Potential Relationships 9 Figure 3 Property, Person, Drugs and Other Offence Rates Per Capita in Victoria by Category 42 Figure 4 Net Gaming Expenditure in Victoria ($m) 44 Centre for Regulation and Market Analysis, University of South Australia iii
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