Inside Asian Gaming

January 2011 | INSIDE ASIAN GAMING 19 somehow mitigate or control the negative social impacts of Chinese citizens spending too much money in Macau casinos. The problem with this thinking is that such a strategy arguably only works if the supply issue is controlled from both ends—i.e. from the industry side and the visitor side. As ever more Chinese citizens become economically eligible to visit Macau, the numbers coming to gamble will also rise. Even if the number of tables were capped in the market beyond 2013, all that would happen then is that table and slot occupancy will simply rise to a point where the casinos are forced to use pricing to control demand and overcrowding, as they do already by raising minimum bets during peak times. If the ‘peak’ seen at Chinese New Year in terms of players on the main gaming floors then becomes the norm, higher pricing in the mass market will assist the operators in boosting margins across the calendar year. Pricingmay also possibly push out the lower earners who can least afford to splash on gambling what little discretionary spending they have. That may be the point. Perhaps the central government and the Macau authorities would rather have the lower- earning visitors to Macau eking out their spending on fairground rides or a trip to see the newly-arrived giant pandas from China in their new home at Coloane than splashing a week’s wages on a few games of baccarat at HK$100 a time. Pricing barriers certainly seem to be an effective mechanism for controlling demand for other consumer services such as luxury hotels. But even modest earners will stretch their hotel budget for a special occasion such as a honeymoon or wedding anniversary. Would some of Macau’s less well-heeled visitors be resistant to pricing mechanisms as applied to minimum table bets? Certainly there is some anecdotal evidence that deeply held ideas in Chinese culture about fate and luck may provide enough motivation for those consumers predisposed to gamble to stretch their budgets as the need arises. Don’t rule out the return of visa restrictions some time in 2011 if operator supply-side restrictions and minimum bet pricing—as well as possible caps on win-rate sharing to match the existing caps on rolling chip commission— don’t dampen player demand. Singapore—aims of casino liberalisation clearly spelled out Panda to the masses—Fairground attractions not table play for Macau’s poorer visitors? Macau Policy