Leavitt, author of the "Freakonomics" and "Superfreakonomics" bestsellers, partnered with fellow University of Chicago professor Thomas Miles, to publish a paper which determines poker as a game of skill and not luck using statistics from the 2010 World Series Of Poker tournament results comparing professional and amateur player results. Entitled "The Role of Skill Versus Luck in Poker: Evidence from the World Series of Poker", the paper argues that the world's top poker players are blessed with the same level of skill as Major League Baseball players.
They claim that "high skilled" players tended to take home 30 per cent more money than they bought in for, whereas other less skilled players on average lost 15 per cent.
Translated to real numbers, this meant that the players in the "skilled" category won an average of $350 per tournament, while the "non-skilled" players lost $400.
"Since the year 2007, [baseball] teams that made the playoffs the previous season win 55.7 percent of their games in Major League Baseball against teams that failed to make the playoffs in the previous year." the study asserts.
"Thus, in some crude sense, the predictability of outcomes for pairs of players in a poker tournament is similar to that between teams in Major League Baseball. To the extent that baseball would unquestionably be judged a game of skill, the same conclusion might reasonably be applied to poker in light of the data."
While many others related to the poker industry have claimed a similar position, the addition of a well respected non poker voice will be welcome. There are some who feel that winning the public mind that poker is a game of skill could lead to a carve out for poker to avoid the huge limitations that UIEGA has imposed on American players."Thus, in some crude sense, the predictability of outcomes for pairs of players in a poker tournament is similar to that between teams in Major League Baseball. To the extent that baseball would unquestionably be judged a game of skill, the same conclusion might reasonably be applied to poker in light of the data."
Leavitt's four reasons why the U.S. crackdown on internet poker is a mistake:
1) Prohibitions that focus on punishing suppliers are largely ineffective. Prohibition of internet poker is no exception.
2) Relative to the consumer surplus generated by online poker, the externalities caused are small. Government interventions should focus on cases where the opposite is true.
3) From a moral perspective, it is inconsistent for the government to condone and profit from gambling on the one hand, while criminalizing private providers of internet poker on the other.
4) Even under the government’s own laws, it would seem that there is little question that online poker should be legal.
2) Relative to the consumer surplus generated by online poker, the externalities caused are small. Government interventions should focus on cases where the opposite is true.
3) From a moral perspective, it is inconsistent for the government to condone and profit from gambling on the one hand, while criminalizing private providers of internet poker on the other.
4) Even under the government’s own laws, it would seem that there is little question that online poker should be legal.
