July 31, 2020

Credit: Ethan Miller / Getty Images

These days, it feels like everyone is thinking about risk. Is it a good idea to travel by airplane? Is it OK to visit parents? Is it safe to go to a park? But if you want to truly understand risk, it might be a good idea to turn to an unlikely source… poker. That’s according to Maria Konnikova, a journalist and author of the book The Biggest Bluff: How I Learned To Pay Attention, Master Myself, and Win. In writing the book, Konnikova set out to discover what poker can teach us about psychology, probability, and, yes, risk. She certainly didn’t set out to win over $300,000 playing professional poker... but sometimes a bet really pays off.

Three Takeaways:

  • For the most part, people don’t have an instinctual understanding of risk and probability. Konnikova says we’re fairly hopeless, and cites the 2016 election. When Nate Silver said that Hilary Clinton had around a 71% chance of winning, people rounded up to 100% and assumed that she would definitely win, but Konnikova points out that a 29% chance is not zero, and is in fact a lot. Silver didn’t get it wrong. It may have been more likely that Clinton would triumph, but it wasn’t a foregone conclusion.
  • But Konnikova thinks that poker helps people really get risk. By playing so many hands of poker, people can get a grasp of what a 50%, 60%, or 1% chance actually feels like. And that can help when making decisions based on uncertainty. Konnikova says that, towards the beginning of the pandemic, “if I look back on my timeline, the people saying ‘hey, we need to do something’ were the poker players, not the psychologists, not the statisticians.”
  • Using poker to understand the world around us actually has a fairly long history. John von Neumann, the father of game theory and one of the key figures in the development of the computer, thought that poker held the key to strategic decision making. Because poker is a game of incomplete information, lying, and chance, von Neumann felt that it was a wonderful model for making decisions in the real world.

More Reading:

  • If you want to learn more about the psychology of winning, losing, and doing better than you ever thought you could... here’s a recent interview we did with Ben Cohen about the science of streaks
  • We also chatted with Konnikova a few years back - before she became a professional poker player. She explained the “artistry” of con artists - and why we get suckered. 
  • If you can’t get enough poker, watch an absolutely fascinating video from Jon Bois on the joys and frequent despairs of playing the game.

Maria Konnikova, risk, Poker, Games, Probability, Business

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