Abstract

http://ssrn.com/abstract=2129879
 


 



Beyond Chance? The Persistence of Performance in Online Poker


Rogier J.D. Potter van Loon


Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE)

Martijn J. Van den Assem


VU University Amsterdam - Faculty of Economics and Business Administration

Dennie Van Dolder


Nottingham School of Economics - University of Nottingham

August 23, 2014


Abstract:     
A major issue in the widespread controversy about the legality of poker and the appropriate taxation of winnings is whether poker should be considered a game of skill or a game of chance. To inform this debate we present an analysis into the role of skill in the performance of online poker players, using a large database with hundreds of millions of player-hand observations from real money ring games at three different stakes levels. We find that players whose earlier profitability was in the top (bottom) deciles perform better (worse) and are substantially more likely to end up in the top (bottom) performance deciles of the following time period. Regression analyses of performance on historical performance and other skill-related proxies provide further evidence for persistence and predictability. Simulations point out that skill dominates chance when performance is measured over 1,500 or more hands of play.

Number of Pages in PDF File: 36

Keywords: poker, online poker, no limit texas hold’em, online gambling, skill, chance, game of skill, game of chance, performance persistence

JEL Classification: C01, D80, K00, K34

working papers series


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Date posted: August 15, 2012 ; Last revised: August 24, 2014

Suggested Citation

Potter van Loon, Rogier J.D. and Van den Assem, Martijn J. and Van Dolder, Dennie, Beyond Chance? The Persistence of Performance in Online Poker (August 23, 2014). Available at SSRN: http://ssrn.com/abstract=2129879 or http://dx.doi.org/10.2139/ssrn.2129879

Contact Information

Rogier J.D. Potter van Loon
Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )
P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands
Martijn J. Van den Assem (Contact Author)
VU University Amsterdam - Faculty of Economics and Business Administration ( email )
De Boelelaan 1105
Amsterdam, 1081HV
Netherlands
Dennie Van Dolder
Nottingham School of Economics - University of Nottingham ( email )
University Park
Nottingham, NG7 2RD
United Kingdom
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