Is the Wheel of Fortune Sufficient to Help the Economy? The Case of Italian Gambling Industry

The Italian gambling industry expanded rapidly in the last decade, facing an unexpected boom in terms of numbers and volume of funds raised. It spreads from old betting experiences established in famous venues (i.e. Venice casino) and soccer games «schedina» to a new and wide variety of online offers of games of chance. Sometime they are unlawful and move from isolated group of people interested mainly in sports betting to new profile of «consumers» (teenagers, housewives, retired people or simply «new» indigent). The paper examines economic characteristics of the industry, including the evolution of major markets, pricing of gaming products, market structures, regulatory constraints, and social and economic impacts attributable to it. When competitive, gambling and lotteries show strong economies of scale and scope, but the 2006 new legislation (the so called Bersani Decree) changed the rules, thus creating substantial financial rents. Allocation of these rents is of great relevance for the public finance due the economic crisis of recent years.