Development of gaming industry--- Casino in Hong Kong

Title: Development of the Gaming Industry – Casino in Hong Kong

Chapter 1

Introduction

It is said that historically, gambling started in ancient China as a form of game and entertainment, which became popular among all the classes within the Chinese society. It has been written that the wagering of games of chance was founded around the periods of Xia (2000 – 15000 BC) and Shang (1700 - 1027 BC) dynasties, and has been popular among the high-class segments of the Chinese. During the course of the development of the Chinese society, many loved gambling, which led to its expansion. It improved the country’s economic conditions in the cities and in the rural countryside, resulting to its commercialization, along with the creation of many other forms of gambling games. However, despite its popularity, many Chinese citizens, including the Chinese imperial officers, indulge heavily on gambling, causing social disorder and dissatisfaction. It also contributed to increasing poverty as many began treating it as a form of livelihood and profession, often involving the use of deception to win. Gambling in ancient China also became a good source of tax revenue, huge monetary gains, and smuggling businesses. It was considered a social problem and issue during those periods, thus, leading to the enforcement of rules and regulations laid down by Chinese imperial rulers. Nevertheless, gambling became a good source of money in ancient China, thus, contributing to the source of entertainment and income of many Chinese citizens (2006).

In Hong Kong, gambling has a long history and is considered one type of social behavior that is deeply rooted in its Chinese culture. Gambling in Hong Kong includes activities such as betting on horseracing, buying Mark Six tickets, playing mahjong with friends, and soccer betting. These gambling activities are popular ways in which people spend their spare time and money with (2002). At present, these gambling activities are authorized in Hong Kong, and cannot be eliminated at an instant.

In addition, the existing authorized gambling outlets cannot satisfy the substantial and lack of authorized channels for casino gaming in Hong Kong, despite the participation and governing powers of the Hong Kong Special Administrative Region or HKSAR. With this, the main goal of this dissertation is to recommend the development of the first casino in Hong Kong gaming industry, which will play an important role in sustaining the future development of the gaming industry in Hong Kong.

The dissertation will be divided into five chapters in order to provide clarity and coherence on the discussion of the topic. The first part of the dissertation will be discussing the problem uncovered by the researcher and provide ample background on the topic. The chapter will constitute an introduction to the whole dissertation, the statement of the problem in order to present the basis of the study, a discussion on the scope of its study, as well as the significance of the study to the society in general and specific effects on individuals.

The second chapter will be discussing the relevance of the study in the existing literature. It shall provide studies on the effect of the gaming industry to the tourism of Hong Kong, an analysis on the current economy of Hong Kong, its tourism industry, its world image as a prestigious Asian city, the impacts of the gaming industry in the society, and its psychosocial effects to the citizens in Hong Kong. After the presentation of the existing related literature, the researcher shall provide a synthesis of the whole chapter in relation to the study.

The third part of the study shall be discussing the methods and procedures used in the study. The chapter shall comprise of the presentation of the utilized techniques for data collection and research methodology. Similarly, it will also contain a discussion on the used techniques in data analysis as well as the tools used to acquire the said data.

The fourth chapter will be an analysis on the tabulated data. After the said tabulation, the data are statistically treated in order to uncover the relationship of the variable involved in the study. With the said data, the chapter seeks to address the statement of the problem noted in the first chapter.

The last chapter shall comprise of three sections, the summary of the findings, the conclusion of the study, and the recommendations. With this three portions, the chapter will be able to highlight the implication of the findings in relation to the data obtained in the study.

Background of the Study

In Hong Kong, a number of law enforcement resources are spent in policing, prosecuting and judging gambling dens and bookmakers that operate without any kind of financial oversight, and the criminal underworld thrives on this activity simply because it is illegal (‘ 2004). However, the government’s continued resistance to legalize and properly license gambling activities in Hong Kong is completely contradictory to the daily activities in the Stock Market and Future Exchanges of placing bets. In addition, the government also supports the monopoly of the Hong Kong Jockey Club, which takes bets on horses and football and runs a lottery, while policing and seizing the operations of gambling establishments with offshore bookmakers and casinos. The government professes a belief in free markets, but allows a monopoly in gambling with strictly prohibited types of bets on only two sports ( 2004).

It is true, however, that gambling activities promote social disorder and immoral and illegal activities, such as drug trafficking, corruption, serious social problems, and many others. Nevertheless, morality aside, the impacts of gambling activities, such as the casino contributes to the improvement of the economy, being treated as a good source of economic income of Hong Kong. Because of this, it is very important for Hong Kong to develop its gaming industry, in line with three main reasons.

Primarily, the development of the gaming industry in Hong Kong will sustain its economic growth. According to the , on the 2004 Hong Kong Tourism Statistics, the total amount that visitor spend on entertainment in 2004 was $1641 million Hong Kong dollars ( 2004’ 2005). However, in Hong Kong, there are no legal gaming activities, which is why if Hong Kong will invest in its gaming industry, then it will gain huge revenues from it. It can also help develop its hotel industry due to the influx of visitors in Hong Kong. The development of the gaming industry can also generate job opportunities, such that the large investment in the development of its gaming industry would need an increase in the workforce, thus, directly or indirectly increasing job opportunities for many.

Second reason is boosting the tourism industry or Hong Kong. With the development of the gaming industry, casinos will become its new attraction, thus attract large numbers of visitors in Hong Kong. Local and foreign visitors will not only visit the casinos, but will also visit other attractions known in Hong Kong, such as the new Hong Kong Disneyland, Ocean Park, Ngong Ping 360 and many others. With this, visitors or even prospective foreign investors will stay longer and contribute more money to the industry of Hong Kong. In addition, due to word-of-mouth and with the help of the World Wide Web, the attractions in Hong Kong will be able to be known to more people around the world, thus, would help contribute to the development of its gaming industry.

Lastly, the third reason would be enhancing the Asian World City image of Hong Kong, being a prosperous city in Asia, which provides many mature and complete business infrastructures. Aside from Hong Kong’s MICE industry, many business opportunities come to Hong Kong, including the increase of a number of mainland visitors due to the Individual Visit Scheme. Furthermore, the opening of Hong Kong Disneyland two years ago complements the mentioned scheme. Thus, if a casino will be opened in Hong Kong, there will be an increase in the impact of the city to other countries, which will enhance its image and competitiveness in terms of business and tourism. Moreover, the image of Hong Kong as a globally competitive and organized city in Asia would be instilled in the minds of foreign investors, which would provide Hong Kong with more prestige and fame worldwide. With these reasons, the gaming industry in Hong Kong must be supported and legalized in order for Hong Kong to achieve such impacts in its economy and tourism.

Objectives of the Study

The context of the gaming industry in relation to the economy and tourism of Hong Kong is one of the most relevant issues being faced in the city. Hence, this dissertation will be conducted in order to determine preferences of people living in Hong Kong in terms of their opinions regarding the legalization of the gaming industry and its impacts in Hong Kong. The specific research objectives for this study can be summarized as follows:

1) To find out why the development of the gaming industry is important to Hong Kong;

2) To find out if Hong Kong is the potential place to develop such an industry;

3) To identify the gambling problems to the society in general;

4) To provide solutions to the gambling problems in the society; and

5) To give some recommendations to the government

Statement of the Problem

Development in terms of economy and tourism can be considered the crucial activities in the growth of any nation. Due to the important role played by the concepts of globalization and internationalization in today’s industries, it is important to give importance to the impact of the development of the gaming industry in Hong Kong as a means for the economic growth of the city. This study intends to determine the impacts of the development of the gaming industry in Hong Kong, in relation to the legalization of gambling activities, as a potential source of economic income. Specifically, the study intends to answer the following queries:

Should the government of Hong Kong opt to legalize gambling?

What social norms should be violated in the legalization of gambling activities?

What are the barriers to be considered in developing the first casino in Hong Kong?

What are the social, global, economic, and political impacts of the development of the first casino in Hong Kong?

What are the strengths, weaknesses, opportunities and threats that can be attributed to the development of the casino gaming industry?

Significance of the Study

This study will be a significant endeavor for the enhancement of the analysis of the economic impact of the gaming industry in Hong Kong, in conducting reliable and credible surveys that will emphasize the opinions of the common citizen. The study will enable the government of Hong Kong to become informed of the opinions, needs and wants of its citizens, which determines the success of the proposed first casino in Hong Kong. It will also determine the strengths, weaknesses, opportunities and threats in the industry of Hong Kong, and use this information as an instrument to enlighten the decision-making process of the authorities.

Scope and Limitations

The study intends to investigate the impacts of the legalization of gambling in Hong Kong, in the form of the first casino. For this study, primary research will be conducted using anonymous questionnaires that will be sent to the general population in Hong Kong of legal age. The questionnaires will be used to collect quantitative data.

In relation to the previous discussion, limitations were also considered, and are as follows:

Are the results valid?
Was the data relevant to the research questions?
Were the data collection methods appropriate for the research activities?
Were the data appropriately analyzed, with the findings adequately corroborated?

Chapter 2

Review of Related Literature

This part of the paper will review the related literatures conducted on the area of study. By doing this, the research may be guided consequently by primarily discovering where the research is coming from, what and how much have been studied regarding the topic, and what it is yet to discuss. Aside from providing the background to the study, this chapter will provide its readers the necessary backbone and support for the research study to stand credible. In addition, by appraisal of past researches related to the study, a historical perspective may be given. The researcher will gain new insights on how much venture has been explored before, which will enable reflection, comparison, learning, and producing a stronger and more efficient study. This chapter will also present the research study a rich source of data, both new and old, which will augment and enrich the study. This part of the study will also accentuate how it will contribute to the field of study it has chosen and further improve it.

Current Economy of Hong Kong

Hong Kong serves to be the main entry of businesses in Mainland China. It has endured a long history, which made it a stronger city as it is today. It is active in the business industry in China, having a globally competitive financial status and development that is being rivaled by other cities in China. Through the course of its history, Hong Kong has enjoyed a great success in terms of retaining a distinct superiority over human resources, its legal system, language, currency and general structure, including a remarkable array of human resources (Kwan 2002). Its human resources not only include citizens from Mainland China who have obtained their education and training in the West, but also an impressive force of accountants, lawyers, and other professionals called over from different parts of the world. The English language has long been integrated into its society and economy, with its currency readily convertible to US dollars that is being used in capital transactions. In addition, because Hong Kong became a colony of Great Britain in the past, it has inherited the British legal system, with its international financial transactions of upholding the laws and regulatory standards that apply to London and New York financial markets (Kwan 2002). On a factual basis, Hong Kong has a free market economy that is highly dependent on international trade, and its reversion to Chinese administration on July 1997 led Hong Kong to participate in extensive trade and investment ties with China (2007). Being a small city, its natural resources are inadequate, thus, its food and raw materials must be imported. Although the growth of its GDP is 5% strong in average from 1989 to 2006, it still endured two recessions in the past eight years due to the financial crisis experienced by Asia in 1997, including the SARS outbreak in 2003 (2007). However, in general, Hong Kong’s status as a financial hub has helped advance the economy of the city, thus improving its economic market performance in late 2006 (2007).

In relation to its current economic situation, Hong Kong is considered to have the freest economy in the world, with its export goods and services providing economic growth of 10.2% and 8.7% in real terms in 2006 respectively ( 2007). In addition, it serves to be a popular venue for hosting events in relation to the business management initiatives of many multinational companies in the Asia Pacific, with a total of 3,845 overseas companies from the United States, United Kingdom and many others, having its operations in Hong Kong in June 2006 (2007). Being the leading telecommunications hub in the Asia-Pacific region, it serves to utilize the use of the Internet for its business transactions, including hosting major international conferences and businesses (2007). With these given information, it can be understood that the activities held in Hong Kong highly participate in the development and improvement of its tourism industry. Because it houses highly educated citizens, it makes Hong Kong a favorable place to invest in and host tourism-related activities, given the fact that its currency is convertible to US dollars, most citizens know how to speak in English, and most facilities and infrastructures are world-class in terms of quality and services. In addition, the attractions in Hong Kong are world-renowned and famous among all ages and to both genders. With such attractions and facilities, Hong Kong would surely be conducive for development and advancement in terms of its tourism industry.

Tourism Industry of Hong Kong

In relation to this is the growth of the tourism industry of Hong Kong, which contributes to the overall growth and development of the whole city. It has been reported that the economy of Hong Kong has moved away from the manufacturing to a service-based economy, which have led to giving more importance to the city’s tourism industry (2002). With this, its government had conducted a critical assessment of its tourism policies to be able to determine how this sector could be developed and to know the needed changes in terms of both the infrastructure and the culture in the city (2002). More importantly, the tourism industry is one of the major foundations of the economy of Hong Kong, with the total tourism expenditure of the government of HK$110 billion in 2006 in terms of its inbound tourism (2007). In addition, because of its current role as Asia’s information hub, many international businessmen come to Hong Kong to explore opportunities, thus, the cycle of obtaining information from the city enhances its role as a gateway to China and to the rest of Asia (2002). With this, it can be seen that the tourism in Hong Kong not only serve to provide leisure and entertainment to its visitors, but also provide relevant and useful information on the business opportunities in the city and to other locations in Asia.

It has been reported that the encouraging growth momentum in visitor arrivals in Hong Kong continued in 2006 with 25.25 million, and an increase of 8.1% from visitor arrivals in 2005 ( 2007). This increase in growth was brought about by the completion of a number of tourist attractions, such as the Hong Kong Disneyland, A Symphony of Lights Phase II, Hong Kong Wetland Park and Ngong Ping 360, which have been attracting tourists from different countries all over the world, including Europe, South and Southeast Asia, and many others ( 2007). With such an increase, the government of Hong Kong decided to also increase its facilities, whereby at the end of 2006, Hong Kong was able to accommodate more tourists through its 126 hotels with 47,128 rooms, including enhancements of projects that would contribute to the facelift of the existing popular tourist areas in the city (2007). In addition, the government would also focus on promoting the history, ecology and diversity of Hong Kong through its facilities, which would largely promote the community-wide hospitality culture of the citizens that, is essential to the sustainable development of the tourism industry. Apart from the attractions to enrich the experience of tourists, the standard of service offered by the workforce of Hong Kong was also enhanced (2007), which would not only provide convenience on the part of the tourists, but would also help contribute to the image of Hong Kong as a world-class city in Asia. From this discussion, it can be understood that tourism plays a major role in the overall development and growth of the economy of Hong Kong, which is being enhanced by the activities and money spent by the tourists in the city. If the government would also give importance and emphasis on the city’s gaming industry, the authorities would be able to perceive that this could also be a potential source for the city’s economic growth.

Gaming Industry in Hong Kong

In relation to the strong participation of tourism in the growth and development of Hong Kong’s economy, it could be perceived that the gaming industry, specifically of the casinos, would be a useful and yet, another contributory means for the economic growth of Hong Kong. It has been already mentioned that the gaming industry in Hong Kong includes several gambling activities, such as betting on horseracing, buying Mark Six tickets, playing mahjong with friends, and soccer betting, which are given time, effort and money by many Chinese citizens, and enable them to become essential to the lives of many individuals in Hong Kong. The gaming industry, specifically the gambling industry is currently valued at one trillion U.S. dollars, and has become a leading leisure activity in many countries, including Hong Kong (2006). Globally, popular gambling games include state-run lotteries, electronic gaming machines or EGM, instant scratch-off tickets, sport betting, and keno and charitable gambling ( 2006), and these activities amount to several billions of U.S. dollars, which are basically spent by gamers all over the world.

Theoretically, gambling is one of the few social activities that occurs in nearly all cultures and in every period of time, and has been fuelled by growing middle-class affluence and the liberalization of social values in different industrialized nations ( 1996). In the case of horseracing and casino games, traditional gambling cultures have been incorporated into broad policies of economic development, notably the expansion of mass tourism and entertainment industries (1996). With this statement, it can be seen that the development of the gaming industry in Hong Kong would actually be beneficial and advantageous on their part, thus, becoming a good and potential source for economic growth and development. Because of the mentioned tourism-related activities in Hong Kong, it can be perceived that the effect of the development of the gaming industry would also be similar. From this similar perceived effect, it can be understood that it is essential for the city to develop its gaming industry, given a number of reasons.

Primarily, the gaming industry, particularly gambling has a long history in Hong Kong, which is considered not only to provide fun and excitement for many people, but also to contribute significantly to the government revenue each year through the collection of betting duty (2002). It has been reported that the gambling money collected finances several good causes for the local community, despite the fact that it contributes to harm, social problems, and individual difficulties in the society of Hong Kong (2002). With the use of such gambling money, many benefits can be determined, including its contribution to the expenses for public infrastructure or services, such as roads, schools, police, fire protection and many others (2000). Second, developing the gaming industry in Hong Kong would help the city with attracting more visitors and tourists in the city, similar to the current situation of Las Vegas over the years. Today, Las Vegas attracts more tourists all over the world, because it supports sports betting, particularly in boxing. During the fights of world-renown boxers from Mexico and the Philippines, many gamblers and sports betters place their bets through different means, whether on the Internet, through actual betting on the stadium, and many other ways. Because of this, Las Vegas is able to accumulate resources and including the prestige of hosting remarkable events in world history. If this will be developed in Hong Kong, then it would probably enjoy the same prestige that Las Vegas enjoys at present, and be regarded as the “Sin City” of Asia. However, despite its rivalry with Macau, which also regarded as the “Las Vegas of Asia”, Hong Kong would have the edge over it because much more tourist attractions are present in Hong Kong than in Macau. This serves to be the edge of Hong Kong over Macau, thus, making it more attractive to tourists. Fourth reason of why the gaming industry in Hong Kong must be developed is that with such an industry, more job opportunities would be opened to many individuals, both domestic and international. With the development of the gaming industry, specifically of the casinos in Hong Kong, the city would be forced to employ additional workforce from other cities, thus, opening more opportunities to professionals from Third World nations. This would in turn, help many individuals obtain employment, such that they are able to become more productive and more knowledgeable regarding this type of industry.

Fifth reason is the fact that through the opening of casinos, Hong Kong would open more opportunities to develop its communication and technology, thus, entitling the citizens of the city to become more exposed to the cultures and practices of other nations. Because the opening of casinos would help develop different means of communication and technology in Hong Kong, many individuals would be able to develop their skills in intercommunication and interrelations with other countries. This would also give many individuals the chance to develop and practice their skills in speaking in English, thus, helping them become more globally competitive, in terms of both individual and company development. Sixth reason is the fact that because many tourists will visit Hong Kong, more opportunities for international businesses would be opened and given to local businesses in the city. This would be their chance to be exposed to individuals, who will help local enterprises obtain a place in the international market. This would in turn enhance and establish the fact that Hong Kong is in fact a favorable and successful international market in Asia.

Another reason to consider is the fact that the development of the gaming industry in Hong Kong would generate more than sufficient revenue as economic resources for the city. Although it is given fact that the city government would invest on such a project, in due process, Hong Kong would enjoy the return of investment, more than its costs. In line with the supposed drastic increase of tourists and visitors in the city, many would also engage in casinos and other gambling activities during their stay in the city, thus compensate the amount of investment of the city government. With this, Hong Kong would enjoy the prestige and the increase for money that comes in because of the joined forces of the tourism and the gaming industry, which would also help the local economy pay for its taxes and debts. Eighth reason is that the development of the gaming industry in Hong Kong would enhance and benefit the personal ambitions and dreams of its citizens, for with luck and strategy, many individuals would have the chance to become rich and be able to enjoy the leisure of being well off. This could also be the source of the overall development and growth the city in the long run, for the city would have to do away with extreme poverty, as experienced in other countries in Asia.

Finally, the government’s legalization of football betting, through the monopoly provided by the Hong Kong Jockey Club, supports the fact that many individuals in Hong Kong are into gambling activities. Through the revenues generated from football betting, the government was forced to legalize it, thus, increasing its tax revenues and reducing illegal football organization’s revenues, which help enhance the development of the sport in Hong Kong (2007). In addition, the legalization of such an activity, along with the establishment of the Hong Kong Jockey Club, numerous social and educational institutions were able to be supported, including the funding of many swimming pools and public sports facilities in Hong Kong (2007). The legalization of such a gambling activity because of its seen advantages can be a justification for the development of casinos in the city, which also aims for the same objectives.

With these reasons, it can be understood that the development of such an industry can be beneficial for the city, if analysis of the issue would be focused on the economic relevance and benefits of the subject. However, considering other issues, especially the ones related to morality is yet another issue to consider and discuss.

Other Countries with Gaming Industries

The view of the image of Hong Kong as a successful and developed city is dependent on the overall perception of tourists and economists alike. Although the city has been returned under the wing of Mainland China, it still remains to be a city that retains and adopts the governance of Great Britain, or United Kingdom for that matter. It is considered a “city that works”, for having a rule of law, efficient transportation, level playing field where businesses can operate without interruptions, and sophisticated and pragmatic citizens with a good deal of common sense (2004). The interaction of such elements enables Hong Kong to become a favorable international market in Asia. However, other countries in Asia, such as Macau and Singapore are experiencing the same situation as Hong Kong, in relevance to the gaming industry.

Macau has already established its gaming industry over 150 years, and is considered to be matured and well developed in terms of such an industry. It has 15 casinos at present, and different kinds of gaming venues. Before, gaming venues are the only venues for entertainment. However, with the development of more casinos, a number of venues have been under the operations of hotels, which bring in a myriad of leisure activities to citizens and tourists alike. The main reason for establishing the whole gaming concept in Macau is to promote its tourisms industry and business, thus, the vigorous and rapid development of its gaming industry contributes to the cause. Similar with Hong Kong, the gaming industry, specifically the casino business has a long history in Macau, thus, is known as the “Monte Carlo of the Orient” (2003). As perceived in Hong Kong, the development of the economy of Macau is accounted for the influx of tourists in the city, which contributes to the development of its tourism and gaming industry, thus, boosting its overall market atmosphere (2004).

Likewise, Singapore is also developing its gaming industry. The Singapore government decided to build two integrated resorts or IRs, namely the Marina Bay Front and the Sentosa. The Sentosa Resort will develop a casino, which would include luxury hotels, a theme park, restaurants, retail outlets, museums, theatres, and many other attractions. In addition, Singapore’s casinos are expected to be completed and operative by 2009, and right now are still starting and relatively new to the business. Because of this, the casinos in Singapore face a tough challenge for maintaining and sustaining a multi-billion dollar industry, such as the gaming industry in Las Vegas, and losses in this type of business can be a huge drain for the government of Singapore (‘2007). Moreover, because casino gaming is relatively new to Singapore, experts say that it is likely that new regulations will be in place to ensure the gaming’s integrity, especially in keeping cheating cases relatively low (‘2007). With such a dilemma, Singapore is planning to use digital technology in keeping the gaming industry developed, with the installation of 2,000 to 3,000 security cameras, to prevent any sleight of hand during the gaming sessions (‘2007).

In addition, in line with the casinos and gambling activities in the United States is the information on the American Gaming Association or AGA, which is an organization in the United States that provides better understanding of the gaming industry to the public of the country and its officials through education and promotion (2003). More importantly, the organization represents the commercial casino entertainment industry and has an insistent public education program, which both enables the association to address important issues regarding regulations, tourism and travel, and decision-making (2003). This serves to be a guide on the part of the citizens, which enables them to further understand the restrictions and regulations in gambling. With this discussion, the objective of this paper is to know as to why Hong Kong has the highest potential to develop its own gaming industry through casinos would be based. The potentials of Hong Kong would be compared relative to the potentials of Macau and Singapore, which are also developing its own gaming industry. This also would allow the researcher to understand the risks that Hong Kong would take in pursuing the project. With these information at hand, the researcher will able to assess the capacity and potential of Hong Kong, if it will be able to utilize and maximize its prospective to develop and venture in such a cause.

Impacts to the Society

Above all, the development of the gaming industry in Hong Kong promotes gambling activities, which would not only influence the morality of many individuals but also give way for other negative practices related to gambling activities. Promoting the legalization of casinos and of gambling activities entirely presents negative social effects than positive ones, thus, in terms and in basis of morality, promoting gambling activities, specifically of casinos would be disadvantageous to the society. Several effects of gambling will be discussed in this part of the paper, in presenting the other side of the coin.

Primarily, promoting and legalizing casinos would influence the attitudes of the youth of Hong Kong, for being exposed to gambling activities at an early age. Although many individuals perceive gambling and going to casinos as a form of leisure, many young individuals might adopt and develop gambling as a habit. This would inculcate in them that gambling does not present negative effects, for they would perceive it as something that is accepted by the society and is done by their parents or guardians. Thus, this would disrupt their morality, and their perception of what is wrong and what is right. Second, individuals would be spending more on casinos than they do on other things, including necessities. This would permit them to borrow sums money from their peers, thus, making them suffer from the consequence of having large sums of debts from them. This is not the same as saying that non-gamblers do not have debts. However, in comparison to problem gamblers, the debt of non-gamblers would be relatively lower (2000). Third, because gambling is associated with serious social problems including illegal triads or secret societies, corruption, and drugs ( 2006), the legalization of casinos would mean to say legalization of such activities also. This would in turn, increase the incidences of crime rates in Hong Kong, and would tolerate such activities that would create chaos and disorder in the society. With this phenomenon, more and more illegal activities would be legalized in Hong Kong, with the same justification and reason as the ones mentioned above. In addition, the legalization of casinos in Hong Kong would invite illegal and Black Market societies, which would further increase chaos and disorder in the city. With this, many citizens would be gravely put in danger, especially non-gamblers. With the increase of chaos and disorder in the city, many criminals would be victimizing innocent citizens to obtain money, so that they can participate in gambling and other activities associated with it.

Fourth negative effect of its legalization is related to the psyche of the individuals that indulge or participate in gambling. Engaging in gambling and other activities related to it develops an addiction, which enables individuals to become abusive of themselves and of other people around them in order for them to get what they want. Engaging in such activities develops and sets the mind of an individual to think that gambling is essential in his or her existence. This, in turn, presents danger on both the part of the gambling addict and the people around him or her. Being a gambling addict would allow him or her to extract all his or her necessary resources in order to participate in such an endeavor. Because of this, the gambling addict would allot more than enough money or budget on casinos than his or her daily subsistence. If this would not be enough, then the gambling addict would borrow money from his or her peers to sustain and maintain his addiction. From this, the gambling addict would be able to neglect his or her bigger responsibilities, thus, resulting to a miserable life. The last reason is that many individuals, especially those socially challenged individuals in the society of Hong Kong would be dependent on their luck to obtain money for their daily subsistence. If more would be dependent on their luck, then, many would not have the initiative and the drive to work hard on their own or use their skills and talents to obtain employment from companies to apply their knowledge and education. Moreover, because of this, many individuals, especially the youth would become irresponsible and neglect their studies in order for them to engage in gambling. With such negative turn of events, many parents and individuals giving high value to education and morality would go against the legalization of casinos in Hong Kong. The presentation of both positive and negative effects or impacts of the legalization of casinos in Hong Kong would become helpful for the researcher to further analyze and assess the conclusion of the research study.

Chapter 3

Methodology

This part discusses the research methods available for the study and what is applicable for it to use. Likewise, the chapter presents how the research was implemented and how it came up with pertinent findings. Moreover, this chapter also presents the various procedures and strategies in identifying the sources for the needed information to know the relative preferences of the chosen respondents in terms of Hong Kong’s gaming industry. It specifies the research design that was followed, the process of data gathering and the data analysis method that would be used.

Research Method

Three kinds of research methods, namely, correlational, experimental and descriptive can be used in a research study. The correlational type of research method is used with regards to ethical and practical problems with experiments. In addition, inferring causality from correlation is not actually impossible but very difficult, so this mode of study is widely acceptable, cheap and usually ethical. Nonetheless, there exist some “third variable” issues and measurement problems. The correlational research refers to studies in which the purpose is to discover relationships between variables through the use of correlational statistics (r). The square of a correlation coefficient yields the explained variance (r-squared). A correlational relationship between two variables is occasionally the result of an outside source, so it must be remembered that correlation does not necessarily tell us about cause and effect. If a strong relationship is found between two variables, using an experimental approach can test causality.

Another type is the experimental method, which is the only method that can be used to establish cause-and-effect relationships ( 1994). That is, this type is the only one that can be used to explain the bases of behavior and mental processes. In this method, the subjects are split into two or more groups, where one group is called the experimental group and gets the treatment that the researcher believes will cause something to happen. This treatment is formally called the independent variable. The experimental and control groups are compared on some variable that is presumed to reflect the effects of the treatment or outcome. This is formally referred to as the dependent variable.

The third and final approach is the descriptive research method, which uses observation and surveys. In this method, it is possible that the study would be cheap and quick. It could also suggest unanticipated hypotheses. Nonetheless, it would be very hard to rule out alternative explanations and especially infer causations. Thus, this study will use the descriptive approach. This descriptive type of research will utilize observations in the study.

The study started by conducting an exploratory research to identify the variables. The research included personal interviews, self-administered questionnaires. In addition, a set of articles and other literature were used in the process of building constructs and identifying variables. After identifying constructs and variables, a questionnaire was made and distributed to hundreds of respondents. One hundred and fifty questionnaires were returned.

Research Design

This study uses the descriptive approach. This descriptive type of research will utilize observations in the study. To illustrate the descriptive type of research, (1994) pointed out that a “Descriptive method of research is gathering information about the present existing condition, in which the purpose is to describe the nature of a situation, as it exists at the time of the study and to explore the cause/s of particular phenomena”.

The research described in this paper is based on qualitative and quantitative method. The qualitative method permits a flexible and iterative approach, while the qualitative research method permits specification of dependent and independent variables and allows for longitudinal measures of subsequent performance of the research subject.

During data gathering, the choice and design of methods are constantly modified, based on ongoing analysis. This allows investigation of important new issues and questions as they rise, and allows the investigators to drop unproductive areas of research from the original research plan.

The value of qualitative research can best be understood by examining its characteristics. One of the primary advantages of qualitative research is that it is more open to the adjusting and refining of research ideas as an inquiry proceeds. In addition, the researcher does not attempt to manipulate the research setting, as in an experimental study, but rather seeks to understand naturally occurring phenomena in their naturally occurring states.

In comparison, the quantitative method is compatible with the study because it allows the research problem to be conducted in a very specific and set terms (1998). Besides, the quantitative research plainly and distinctively specifies both the independent and the dependent variables under investigation. It also follows resolutely the original set of research goals, arriving at more objective conclusions, testing hypothesis, determining the issues of causality and eliminates or minimizes subjectivity of judgment ( 1996). In addition, this method allows for longitudinal measures of subsequent performance of research subjects (2002). Finally, it provides achieving high levels of reliability of gathered data due to, namely, controlled observations, laboratory experiments, mass surveys, or other forms of research manipulations. This study should be based on surveys and statistical treatments, so basically, the quantitative approach suits well with it.

Research Instrument

The researcher designed a questionnaire for the purpose of the interview process. The primary aim of the questionnaire is to examine the preferences of citizens in relation to the legalization of casinos in Hong Kong and the impact that it could have on the citizens and the society as a whole. This research will use a mixture of closed questions and more open comments in the questionnaire. A closed question is one that has pre-coded answers.

Through closed questions, the researcher will be able to limit responses that are within the scope of this study. For example, the researcher intends to ask the respondents what they think of the gaming industry in Hong Kong in general. Using a multiple-choice method, the answer of the respondents would be within the one of the limited expected answers of the researcher. Thus, the researcher will design a closed question type to remain focused on the statement of the problem and on the main purpose of the study. In addition, closed questions will be used in the survey because the answers are easy to analyze and are straightforward as target respondents are mostly busy that they do not have enough time to give attention to open questions. Closed response questions save the respondent having to think of possible replies.

The questionnaire consisted of mainly three parts. The first part was a set of categorical questions to identify a respondent’s personal data and information, which corresponds to the demographic data the study will be needing, including the age, occupation, status, and gender. The second part of the questionnaire includes a number of questions to measure the attitudes, preferences, and factors that may affect the gambling activities of respondents, if any. A 5-point Likert Scale was used in this part to measure each construct. Variable used in the scale were mainly derived from the exploratory research results and from some related literature. The third part of the questionnaire included questions for the purpose of respondent clarification, which have a number of open-ended questions for the basis of interview.

In the Likert technique, a set of attitude statements are presented, where subjects of a study are asked to express agreement or disagreement using a five-point scale. The degree of agreement is given a numerical value ranging from one to five, thus a total numerical value can be calculated from all the responses ( 2004).

Hence, the primary source of data will come from a questionnaire and interviews conducted by the researcher to selected respondents belonging to the general population in the main island of Hong Kong, with such an exposition to such activities. The secondary sources of data will come from published articles related to the topic, including books and related journals and magazines.

For this research design, the researcher gathers data, collates published studies from different local and foreign universities and articles from related journals. The researcher also makes a content analysis of the collected documentary and verbal material. Afterwards, the researcher will summarize all the information, make a conclusion based on the findings, and provide insightful recommendations in relation to the concepts and implications covered.

Sampling Size

In order to gather first hand information, the researcher has respondents of the study, which are composed of the general population in Hong Kong, specifically of the citizens living in the city of Kowloon. The working citizens among the population were the chosen target respondents. The first option was to have as many respondents as the research will have. However, because of unexpected circumstances, the research was only able to consider 150 respondents who had the time to participate in the study. The questionnaire-survey has been used to collect data on the respondents’ demographic profile, to check that the sample is appropriately stratified and representative, and to provide further information about the sample for analysis purposes.

Sampling Method

A simple random sampling was used in this study because with this method, the research study would be more convenient and would allow for more comprehensive data analysis (1978). Because considering the entire population of the city of Kowloon would be not feasible for this research study, the researcher has chosen the participation of the working class among the general population of Kowloon, for the members of the working class would be more likely to engage in gambling, particularly in casinos because they have the means to do so. In addition, members of the working class in Kowloon would be the target population for they would definitely have the say on the legalization of casinos in Hong Kong. In simple random sampling, all samples of that particular population have the same chance of being selected (1978), thus, making it easier for the researcher to analyze and gather data.

The research targeted the persons residing in the main island of Hong Kong, specifically in the area of Kowloon, where potential citizens are exposed to gambling and gaming. The sample was randomly selected and a five-page questionnaire was used to measure the theoretical constructs of the attitudes, preferences and choices of citizens in relation to gaming and gambling. A 5-point scale with end points like “strongly agree”, “strongly disagree”, “agree”, “disagree”, and “uncertain” was used to measure the items. On the scale, number 1 indicates the strongly positive response and number 5 indicates the opposite extreme.

The equivalent weights for the answers will be:

Range Interpretation

5 Strongly Disagree

4 Disagree

3 Uncertain

2 Agree

1 Strongly Agree

The researcher opted to use the questionnaire as a tool since it is easy to construct having the rules and principles of construction are easy to follow. Moreover, copies of the questionnaire could reach a considerable number of respondents either by mail or by personal distribution. Generally, responses to a questionnaire are objectified and standardized and these make tabulation easy. But more importantly, the respondents’ responses are of their own free will because there is no interviewer to influence them. This is one way to avoid biases, particularly the interviewers’ bias. The researcher will also use graphs and charts for data presentation.

Validation of the Instrument

A combination of the closed-type and open-type questions were used in this research study. Closed-type questions were used for efficient and easy tabulation of the gathered data, while the open-type questions were used to provide the respondents of the study a chance to express their personal views based on the questions asked. Hence, the data gathered in using both types of questions will be relevant to the discussion of the subject matter.

For validation purposes, the researcher pre-tested a sample of the set survey questionnaires. This was done by conducting an initial survey to at least five respondents from the chosen respondents of the population. After the respondents answered, the researcher then asked them to cite the parts of the questionnaire that needs improvement. The researcher even asked for suggestions and corrections from the respondents to ensure that the survey-questionnaire is effective. Automatically, these five respondents were not included as respondents for the study.

Data Collection Plan

The researcher excluded the five respondents who initially used for the validation of the instrument. The researcher also tallies, scores and tabulates all the responses in the provided interview questions. In addition, the interview used is a structured interview. It is consisted of a list of specific questions and the interviewer does not deviate from the list or inject any extra remarks into the interview process. A structured interview is a kind of interview that promotes a question and answer process. Although the researcher can put or add further questions regarding the subject matter, the interviewer must see to it that the process should remain objective rather than subjective, and that he or she does not have any right to state his or her own opinions and ideas so as not to influence the answers or comments of the interviewee. The interviewer may encourage the interviewee to clarify vague statements or to further elaborate on brief comments. The interviewer does not share his or her own beliefs and opinions. The structured interview is mostly a “question and answer” session.

Statistical Treatment of the Data

After the collection of the entire survey questionnaires, analysis and collation of such data must be done next. With this, the researcher will be using statistical tools and methods to analyze all the data, and will be assisted by the SPSS in coming up with the statistical analysis for this study. Because of this research design, the results of the data gathered were limited to the determination of the opinions of the target population regarding the legalization of casinos in Hong Kong, and as to why or why not Hong Kong is the potential place to develop such an industry. Thus, other possible findings in the field of study are also analyzed.

Comparisons were drawn between the overall responses to the questions and the differing responses (1994). The following statistical formula will also be used:

1. Percentage – to determine the magnitude of the response to the questionnaire

% = ___ x 100 ; where n is the number of responses, and

N N is the total number of respondents

2. Weighted Mean

f1x1 + f2x2 + f3x3 + f4x4 + f5x5

X = ______________________

where: f is the weight given to each response;

x is the number of responses; and

xt is the total number of responses

The researcher will be assisted by the Statistical Package for the Social Sciences or SPSS in coming up with the statistical analysis for this study. SPSS is one of the most widely available and powerful statistical software packages that cover a broad range of statistical procedures. It allows a researcher to summarize data (e.g. compute means and standard deviations), determine whether there are significant differences between groups (e.g. t-tests and ANOVA), examine relationships among variables (e.g. correlation, multiple regression), and graph results (e.g. bar charts, line graphs) (2003).

Chapter 4

Presentation, Interpretation and Analysis of Data

This part of the research study will be discussing the findings, which is based on the self-administered questionnaires provided by the researcher. The primary aim of this study is to know the opinions and preferences of the citizens of Hong Kong regarding the legalization of the gaming industry in the city. It aims to find out why the development of the gaming industry in the city is important to its economy and if it is the potential place to develop such a cause. This study also aims to identify the gambling problems to the society of Hong Kong in general that affect its citizens and society as a whole. Furthermore, this research study aims to provide solutions to the gambling problems in the city, and to give some recommendations for the government of Hong Kong.

For this research study, primary and secondary researches were used, wherein the primary research materials came from the self-administered questionnaires that were sent and distributed to the supposed participants of the research study. The questionnaires were used to collect quantitative data. The conduct of this study entails the level and position of the respondents. It was assumed that the attributes of the respondents or participants influence their behavior and answers on the survey questions.

The researcher has used closed questions for the questionnaire. These questionnaires were used to gather quantitative data and the interviews were used to provide qualitative ideas into the data gathered.

Appendices

Appendix A: Self-Administered Questionnaire (Part 1)

Personal Information of Respondent

Please provide necessary answers on the space provided after each item. On items with choices, please mark the corresponding answer in line with the respondent’s preference.

Name: _____________________________ Date: _________

Gender: Female ______ Male: ______

Age Range:

Below 20 _____ 20 to 25 _____ 26 to 30 _____ 31 to 35 _____

36 to 40 _____ 41 to 45 _____ 46 to 50 _____ Over 50 _____

Race:

Malay _____ Chinese _____ Indian _____ Others _____

Religion:

Christian _____ Muslim _____ Catholic _____ Buddhism _____

Hindu _____ Others _____

Marital Status:

Single _____ Married _____ Divorced/Widowed _____

Children (if any): _____

Educational Background:

High School Education _____ University Education _____

Masteral Studies _____ Doctorate Studies _____

Occupation:

(A) White Collar Job – doctor, lawyer, nurse, accountant, etc

(B) Blue Collar Job – construction, domestic helper, plumber, factory worker, etc

Type of Employment:

(A) Full time employee

(B) Freelancer

Type of Industry:

(A) Medical/Legal/Economic

(B) Academic Institution

(D) Architecture/Designing Firm

(E) Public Service/Government

(F) Others

Participation in Gambling Activities:

Yes _____ No _____

Appendix B: Self-Administered Questionnaire (Part 2)

All items are responded to using a 5-point Likert-type scale with the following points: 1 for Strongly Agree; 2 for Agree; 3 for Uncertain; 4 for Disagree; and 5 for Strongly Disagree. Please mark the corresponding space for the points.

1. Do you recognize the fact that gambling activities are already part of the everyday lives of an average citizen?