Forecasting casino revenue using Google trends data: Political instability on the Korean Peninsulas

초록

Political instability, combined with the constant threat of military action, remains the rule between South and North Korea, threatening South Korea’s burgeoning casino sector. There is still little research examining casino-demand forecasting using Google trends data, denying the academy and industry vital insights. The purpose of this study, therefore, is (a) to use Google Trends to investigate whether the political dynamics between South and North Korea lead to more accurate casino-revenue forecasting and (b) to compare South Korea’s domestic “open” casinos and foreigner‐only casinos to identify different spending patterns. Acquired monthly from January 2010 through September 2015 from every casino in South Korea, our Google Trends data were unique. We found significantly more explanatory power in the forecasting models after Google Trends data using keywords related to North Korea were incorporated. Moreover, Google Trends data with keywords related to North Korea were shown to be capable of playing a fundamental role in South Korean casino-revenue forecasting across both groups (i.e., foreigner-only casinos and domestic casinos).

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