Las Vegas

4010 Words17 Pages
ECON 230:
Urban Economics (G2)

Term Paper: Business Location Decisions & Patterns:
An Analysis of the Agglomeration Effects in Las Vegas

Table of Contents Introduction 3 Motivation 3 Background and History 3 Las Vegas Strip Today 6 Location Quotient of Las Vegas 7 Development Phases of Las Vegas 8 The First Wave of Development 9 Supply-side Factors 9 Demand-side Factors 10 The Second Wave of Development 11 Demand-side Factors 11 Supply-side Factors 13 Summary of Development Phases 14 Comparing Macau with Las Vegas 15 Lessons Learnt For Singapore 17 Conclusion 18 Bibliography 19

Introduction
Motivation
Over the years, Las Vegas has developed itself into a city housing mega-resorts and
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The mega resorts era officially began in 1989 when developer Steve Wynn built The Mirage. It had about 3,000 rooms with gold tinted windows, setting the new standard for Las Vegas luxury. This triggered a construction boom of luxurious mega resorts. Please refer to Figure 1 for an illustration of the luxurious mega resorts that were developed since 1989.

Figure [ 1 ]: Illustration of Mega Resorts in Las Vegas Strip

Las Vegas Strip Today
Las Vegas today is known as the gaming capital and the sin city of the world. Tourism drives the economy. About 37 million people visit the city and the spending is a high of USD33.7 billion. At least 20% of the jobs are gaming related. Even though Las Vegas held the gambling monopoly for 40 years, by 1978, there were over 19 states allowing some form of casino style gambling. However, Las Vegas continued to outperform the rest of the states. In fact, the Las Vegas Strip’s gaming revenue alone tops the US market. (Refer to Table 1)
Table [ 1 ]: Top Casino Market By Gaming Revenue Casino Market | | 2008 Annual Revenues | 1 Las Vegas Strip | | $6.121 billion | 2 Atlantic City, N.J. | | $4.545 billion | 3 Chicagoland, Ind./Ill. | | $2.251 billion | 4 Connecticut | | $1.571 billion | 5 Detroit | | $1.360 billion |
Source: http://www.americangaming.org/industry/factsheets/statistics_detail.cfv?id=4
When compared to the next most successful area, Atlantic City, the casino-hotel industry in Las Vegas

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