"If you're going to ask somebody to compete with a government institution which is giving away free booze, why would the patrons want to go to those restaurants and bars when they can go to a government operation?"
My experience of Laughlin, Nevada (a kind of mini-, cut-rate Los Vegas) is that this situation doesn't arise in the U.S. because the town is basically a waste-land around the casino complexes. There are almost literally no businesses to compete against, and all the Casinos are offering the same deal--a lady carrying a tray full of White Russians.
But you do have to pay for your drinks anyway, at least indirectly, in that the service is much better around the $5 slots than the $1 slots, and fairly non-existent around the 25 cent poker machines. So you get served more the bigger you lose. My trick was to follow the serving girl around the floor, then set-up in front of one of the more expensive machines and fumble through my pockets as though I was looking for my betting money.
I lost about $40 over the time I was there, and got about 20 unpaid drinks out of the deal. So it was almost the same as just hanging out in the bar for two days.
