Estimating the Indirect Contribution of Sports Books: Sports Wagering as a Driver of Other In-House Revenues

Using data from a repeater market hotel in Las Vegas, Nevada, the relationship between sports book and slot machine revenues is examined. Daily sports book write and daily slot handle are compared over a 250 day period. Though many industry leaders theorize that sports book gamblers also wager in slot banks, the results of this research fail to demonstrate a statistically significant relationship between sports book write and slot coin-in. This study advances literature currently available by establishing the lack of such a relationship and disputing the generally accepted assumption that sports books produce a substantial indirect contribution to other in-house revenues. While the sports book does generate a fairly constant direct profit for the casino, the absolute value of that profit is minimal and the results of the study show there is no indirect profit contribution from sports books to slot machines. Given these results, casino management may want to consider that a large sports book is not an optimal use of casino floor space