A Macroeconomic Theory of Texas Holdem
July 16th, 2005

I am having a banner day as an intellectual, it being no coincidence that my television is currently broken. I could take this excellent opportunity for creative output to bemoan yet another unfathomably stupid government-funded “power of prayer” study, but I opted for a more lighthearted subject.

To be completely candid, I started doing just that, but I depressed myself too much to finish it.

Therefore, I will regale you, the reader, with a dissertation on another utterly important subject. Namely, gambling.

Trading emails with a friend the other day, I described the poker craze that is gripping the nation as “the pet rock of this era.” I was immediately taken to task and told to defend this statement.

The argument I was given went about like this.

If one is an expert at poker, one can expect to win consistently. That’s much more than you can hope to get from other games of chance like blackjack or craps, so why would anyone lose interest in poker, given the unwavering popularity of those games?

Forget that it’s on television; once you’re into poker, I think you are hooked for life.

First let me say that I am not backing my response with any hard data. This is purely an academic exercise.

Poker suffers from an important handicap: it is necessarily worse than a zero-sum game. The winners are few, and in large tournaments or online walk away with somewhat less than what the losers have given up.

The idea that an adroit player can consistently come out the better appears to be all-too-true. But rather than being an asset, this is the very reason why poker will not continue in popularity. For every player that wins consistently, there are players who lose just as consistently.

These players plainly will not be interested indefinitely. They have sprouted like reeds from the Nile-esque deluge of ESPN coverage for the time being; in fact, this is making it significantly easier to be one of the lucky few who leave with chips.

When the plebeian interest wanes, the game’s talent bar will steadily rise. Ultimately, nearly all of those who currently style themselves as among the upper echelons will look around only to see that they are in free fall.

This kind of analysis is not difficult to derive; why is it that so few take the trouble to do it?