Advancing data analytics model in examining economic impact of the United States gaming industry

Casino industry is one of the strongest growing industries in the United States (US). Recognizing the importance of this industry, this study suggested a new efficiency measurement technique for casino industry. The proposed efficiency measurement technique extends the quantitative data analysis methodology for business performance measurement and can be applied to other research and business communities. This study measures efficiency of casinos operating in the US. Casinos from 24 states where gaming is legalized and whose basic information is provided with the American Gaming Association were studied. The results helped in providing a comprehensive index for measuring overall efficiency of the casinos by comparing identified states of the US and thereby recognizing the casino economic impact on the society. The output-oriented Data Envelopment Analysis (DEA) were applied to calculate casino efficiency scores and performances. These models helped in determining the optimal benchmark for commercial casinos. The results demonstrate that significant economic impact created by more than half of the states of the US. Furthermore, the quantitative model proposed in this study is a pioneering work. It measures Malmquist Productivity Index (MPI) to evaluate the efficiency change over time for the casino industry of the US by considering both optimistic and pessimistic frontiers of DEA model. It has been observed that the Malmquist Index values calculated using double frontier DEA method are providing a panoramic view of the productivity changes over time. Results are more accurate than previous studies unfolding a different perspective of the US gaming industry. This study also provides an explanation of the US gaming tourism paradox in the hospitality sector. From the outcome it has been observed that the non-destination gaming states were performing well during post-recession years which indicates if consumers find less expensive ways to spend their discretionary income, they will always be attracted towards that. Therefore, non-destination states’ casino marketers should promote their business in the local markets, through investing more and providing better gaming experiences to their customers, which in turn will improve the local economy through more job creation, better tax revenue collection etc., thereby improving the economic condition of the society