How Casinos Work

The Villa Giulia Roma
The Villa Giulia Roma
Photo courtesy of Jacopo Barozzi da Vignola

Gambling almost certainly predates recorded history, with primitive protodice known as astragali (cut knuckle bones), and even carved six-sided dice found in the most ancient archaeological sites [Source: Schwartz]. However, the casino as a place for people to find a variety of ways to gamble under one roof did not develop until the 16th century. A gambling craze swept Europe at the time, and Italian aristocrats often held private parties in places known as ridotti [Source: Schwartz]. These were basically private clubs for rich people, but the popularity of gambling meant that was the primary pastime. Technically, gambling was illegal, but rarely was a ridotto bothered by legal authorities - apparently the nobles knew just when to expect the Italian Inquisition. The lower classes were also gambling, but they didn't have a fancy place to do it in.

In 1638, the government of Venice decided that if they ran a gambling house themselves they could better control it and, while they were at it, make a lot of money. Thus, they authorized the opening of not just any ridotto, but the Ridotto, a four-story gambling house with various rooms for primitive card games and a selection of food and beverages to keep the gamblers happy [Source: Schwartz]. The Ridotto was important for two reasons -- it was the world's first government-sanctioned gambling house, and the first that was open to the general public. High stakes games meant that the clientele were still generally rich people, but in principle, the Ridotto makes Venice the birthplace of the casino. The idea spread throughout Europe as people either thought of it themselves or copied it from the Italians. Indeed, most popular modern casino games were invented in France. As for the word itself, a casino was originally a small clubhouse for Italians to meet in for social occasions. The closure of large public gambling houses like the Ridotto pushed gambling into these smaller venues, which flourished [Source: Schwartz].

Original facade of the Newport Casino before modifications.
Public Domain

In the United States, gambling went through waves of popularity and decline, with a strong wave in the 1800s. Gambling on Mississippi riverboats and in frontier towns were an integral part of the 'Wild West' culture, but when moral conservativism took hold of the country in the early 20th century, gambling was on the way out. It wasn't until 1931 that the desolate state of Nevada decided to legalize gambling. Like the Venetians before them, Nevada politicians figured they might as well gain something from all the illegal gambling that was going on anyway. Plus, the brand new Hoover Dam (then called the Boulder Dam) was sure to bring tourists running -- why not give them another way to spend their money within Nevada's borders? [Source: California State Library]. Soon, casinos drew gamblers to Reno, then Las Vegas, where the downtown gambler's casinos gave way to the Strip, a neon oasis of themed resort casinos and glamorous stage shows. Atlantic City, New Jersey tried to bring legal gambling to the east coast in the 1970s, with limited success. But the biggest change in the U.S. casino business since 1931 happened in the late 1980s, when Native American tribes decided to get a piece of the action. We'll discuss Native American casinos a little bit later.

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