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Kentucky and the Thoroughbred Industries: Prospects and Challenges as Gambling Popularity Declines

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  • Lambert, Thoomas

Abstract

Over the last 15 to 20 years or so horse racing has seen declines in wagering and fan attendance throughout the US. Because of this, the number of races, horses per race, the number of thoroughbred farms, and new thoroughbreds bred and born each year for about the last 10 to 12 years have also declined. The decline in wagering has occurred despite simulcasting of races, online betting, and gambling machines which employ films of past races (historical horse racing machines). Those racetracks doing well are usually part of larger casino and entertainment complexes (racinos). Kentucky, which has one of the greatest number of horses and horse farms per capita in the United States, and which is also home to one of the world’s premier racetracks and horse races, Churchill Downs and the Kentucky Derby, has seen declining inflation adjusted horse industry tax revenues since the 1990s. These losses only exacerbate a state budget which has already seen substantial declines in or an almost complete loss of tax revenues from two other major industries of the state, coal and tobacco. This research note explains why the thoroughbred industries are declining and how this is impacting some Kentucky state tax revenues.

Suggested Citation

  • Lambert, Thoomas, 2020. "Kentucky and the Thoroughbred Industries: Prospects and Challenges as Gambling Popularity Declines," MPRA Paper 105077, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:105077
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    File URL: https://mpra.ub.uni-muenchen.de/105077/1/MPRA_paper_105077.pdf
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    References listed on IDEAS

    as
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    2. Arun K. Srinivasan & Thomas E. Lambert, 2017. "The Impact of Stagnating Casino Revenues on State and Local Governments Tax Receipts," Public Budgeting & Finance, Wiley Blackwell, vol. 37(1), pages 26-46, March.
    3. Coelho, Philip R P & McClure, James E, 1987. "Barriers to Entry in the Market for Stud Services: Government and "Non-profit" Institutions in Collusion," Economic Inquiry, Western Economic Association International, vol. 25(4), pages 659-670, October.
    4. Losey, Robert & Lambert, Thomas, 2020. "Pricing Stallion Seasons for an Individual Stallion: The Existence of Top Tier Pricing and Market Power," MPRA Paper 99700, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    gambling; horse racing; parimutuel wagering; tax revenues; thoroughbred industries;
    All these keywords.

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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