While musical shows, dazzling lights, dramatic scenery and a range of dining options help draw people to casinos, it is games that provide the billions in profits casino owners rake in every year. Slot machines, blackjack, poker, roulette, baccarat and craps all contribute to the excitement and profitability of this popular entertainment.
While gambling probably predates recorded history, the modern casino as a place where patrons could find all sorts of ways to gamble under one roof did not develop until the 16th century, when a gambling craze swept Europe. Then, Italian aristocrats gathered in private clubs called ridotti to play their favorite games, often with the complicity of local authorities. [Source: Schwartz]
In the United States, legal gambling first occurred in Nevada in 1931, although it was a sham operation until the 1970s. Even then, gambling remained illegal in most of the country until New Jersey opened its doors to commercial casinos.
Despite their illegal status, casinos remain a lucrative business. They rely on mathematical expectancy, or house edge, and variance (the amount of money a game loses over time), to make sure they will earn an adequate gross profit. Those who study the math of gambling and develop computer programs that help casinos predict expected wins and losses are known as gaming mathematicians and programmers.
Despite their high-tech security measures, casinos still face a number of problems. Cheating and theft are common, and some gamblers have serious addictions. In fact, studies show that the economic benefits of casinos to a community are offset by the cost of crime and lost productivity associated with problem gambling.