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A paper by Mandel, Alamar, and Glantz, recently published in Tobacco Control, purports to show that the implementation of a smoking prohibition in Delaware had no statistically significant effect on the gaming revenue from slot machine-like video lottery terminals (VLTs) located at Delaware racetracks.1 A subsequently published correction by Glantz and Alamar corrects for a data coding error and for reported heteroskedasticity in the data, but reaches the same conclusion of no significant effect.2
I have carefully examined the data and methodologies used in those studies, and conclude that their finding is questionable. Using more general approaches to controlling for heteroskedasticity and seasonality in the data, I find that both total gaming revenues and revenues per VLT declined significantly after the implementation of the Delaware smoke-free law.
Table 1 reports the results of ordinary least squares (OLS) regressions that replicate the model estimated in the correction of Glantz and Alamar. The first regression uses inflation adjusted total revenues as the dependent variable; the second uses revenues per machine. The underlying data are publicly available from the Delaware Lottery.3 The focus of the analysis is on the variable Plaw, a dummy variable representing the implementation of the smoke-free law. The coefficient on Plaw is negative in both equations. In the case of …
Competing interest statement: The author declares no competing interests. The opinions expressed in this letter are those of the author and do not necessarily represent the official positions of the Federal Reserve Bank of St Louis or the Federal Reserve System.
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