This stimulus or beneficial impact could happen two main ways:
Tourists from abroad spend more time and money within the region. For example, if foreign tourists changed their travel patterns so that rather than coming to both California and Las Vegas, they only go to California.
Local residents who used to travel outside of the region and gamble now stay within the region.
There are also ways that building a casino could result in no increased benefits for the region:
Local residents who used to go to restaurants now spend their money in the casino. Then the casino has no net economic benefit.
Tourists who used to spend money on other activities within the region now go to a gambling facility within the region.
Constructing a casino could hurt a region if either of the following occurred:
Locally-owned businesses go bankrupt because consumers have changed their expenditures to casinos that happen to be owned by out-of-state interests.
Casinos buy more products from out of state than the businesses they replace.
Casinos result in increased social costs including police and other public services as well as the costs of pathological and problem gamblers. These issues will be addressed shortly.