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Poker - a game of luck or skills. Review of theoretical and empirical studies and conclusions for law regulations

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  • Mikołaj Czajkowski

Abstract

Whether poker is a game of luck or skills remains open to debate, both in Poland and abroad. The answer to this question determines if poker is classified as gambling and potentially penalized. This paper provides the merits to answer this question based on the review of theoretical, simulation-based, experimental and empirical studies devoted to the game of poker, and in particular – Poker Texas Hold’em. The results univocally show that although there is a component of chance in poker, it is the skills that matter in the long run (to the similar extent as in sports). Quantifying chance in poker is also discussed – the minimum amount of time required for skills to statistically outweigh chance. In conclusions, I propose a more pragmatic approach to regulation – based not on classifying poker as a game of luck or a game of skill, but rather taking the cost and benefit analysis into account, which includes externalities and consumers’ welfare change associated with either of the solutions – legalizing or delegalizing poker.

Suggested Citation

  • Mikołaj Czajkowski, 2015. "Poker - a game of luck or skills. Review of theoretical and empirical studies and conclusions for law regulations," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 40.
    • Handle: RePEc:eko:ekoeko:40_33
    DOI: 10.17451/eko/40/2015/80
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    File URL: http://ekonomia.wne.uw.edu.pl/ekonomia/getFile/754
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    References listed on IDEAS

    as
    1. Marcel Dreef & Peter Borm & Ben van der Genugten, 2004. "A new relative skill measure for games with chance elements," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 25(5), pages 255-264.
    2. Steven D. Levitt & Thomas J. Miles, 2014. "The Role of Skill Versus Luck in Poker Evidence From the World Series of Poker," Journal of Sports Economics, , vol. 15(1), pages 31-44, February.
    Full references (including those not matched with items on IDEAS)

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