Beneath the glitter of flashing lights and opulent furnishings, casinos stand on a bedrock of mathematics engineered to slowly drain patrons’ money. To make a profit, every game has a mathematical expectancy of winning that must be balanced against the expected losses on other games. This is known as the house edge or house advantage. Casinos also track their profits by the variance of each game, a measurement of how much the payouts deviate from the house expectancy. The mathematicians and computer programmers who study these statistical deviations are known as gaming mathematicians or gaming analysts.
To maximize their profits, casinos typically offer a wide variety of gambling products, including table games like blackjack, roulette and craps; video poker; sports betting; and horse racing. In addition, some casinos feature live entertainment and other non-gambling activities, such as restaurants, art galleries, shopping malls and theaters.
Because of their enormous potential for profit, casinos attract large bettors and offer them extravagant inducements such as free spectacular entertainment, transportation and luxurious living quarters. In the past, mobster involvement in many casinos was common, but legal gambling business such as real estate investors and hotel chains soon swooped in to buy out the mobsters, and federal crackdowns have made it difficult for organized crime to operate casinos.
While there is an element of chance in most casino games, some have a significant skill component. These games are referred to as table games, and they are generally operated by live croupiers. In games where players compete against each other, such as poker, the casino earns money through a commission called the rake.