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peterbirksOne of the more interesting studies undertaken by Kahneman and Tversky was an experiment whereby they provided the subjects with a random number (say - the spin of a roulette wheel, which had been observed by the participant) and then asked them to estimate, say, the number of countries in Africa with a GDP of more than $700 per head per year.
If the number on the roulette wheel was high, then the estimate of the participant tended to be higher than it was from participants who observed a low number being spun on the roulette wheel. So, even though the participants knew that the number on the roulette wheel was randomly generated it still affected their immediately subsequent assessment of a totally different number.
This 'anchoring' habit can have an influence on how I play a hand. Yesterday I played one of those "trivial" hands against a short stack. I raised in late with TT, got called by a short stack in the big blind. Flop came Jxx. He checked. I continuation betted, he raised all-in (actually, little more than a check-miniraise) and I called. At showdown, my TT was good.
The very next hand, I picked up some kind of minor raising hand, possibly 88. A loose player limped and I raised to 3xBB. It was passed round to the original limper, who called. Flop came ATx rainbow. He checked, I bet, and he folded. Not much of interest there, except for the fact that the appearance of a 10 on the board made it less likely that my opponent would call my CB. Most of the time it makes little difference, but if opponent is on the margin of calling/folding, his subconscious will recall that you had TT last hand. He will overrate the likelihood of you having a ten.
This has a more frequent impact when you have just been to a showdown with something like, say, AJo (which loses a smallish pot) and you pick up QJs the following hand. Your problem now is that the subsconscious of your opponent is now likely to help him make the right decision for the wrong reasons. He is going to overrate the chance of you having a jack, because of anchoring. Unfortunately, you do have a jack. In addition, you lost the previous hand. 'Anchoring' in this instance works against you, because your opponent's subconscious is saying 'this guy gets jacks a lot' and also 'when he gets a jack, he tends to lose at showdown'.
Suppose the flop comes KJ3 two hearts and opponent has K5 of spades. Sometimes he might call you down and sometimes he might give up on the turn. If you had AJ the previous hand, he is more likely to call you down.
+++++++++
It was 20 years ago today, tra la tra la. 'Black' Monday wasn't really that black, in retrospect Mr Potts on 'Wake Up To Money' this morning came up with some nice narrative fallacies while stating how it was 'the buying opportunity of the century'. I suspect that all these guys are wel-versed in the ways of Taleb, but it does not suit their public persona to admit that, basically, er, we haven't really got a clue what's going to happen next week, let alone next year.
If the number on the roulette wheel was high, then the estimate of the participant tended to be higher than it was from participants who observed a low number being spun on the roulette wheel. So, even though the participants knew that the number on the roulette wheel was randomly generated it still affected their immediately subsequent assessment of a totally different number.
This 'anchoring' habit can have an influence on how I play a hand. Yesterday I played one of those "trivial" hands against a short stack. I raised in late with TT, got called by a short stack in the big blind. Flop came Jxx. He checked. I continuation betted, he raised all-in (actually, little more than a check-miniraise) and I called. At showdown, my TT was good.
The very next hand, I picked up some kind of minor raising hand, possibly 88. A loose player limped and I raised to 3xBB. It was passed round to the original limper, who called. Flop came ATx rainbow. He checked, I bet, and he folded. Not much of interest there, except for the fact that the appearance of a 10 on the board made it less likely that my opponent would call my CB. Most of the time it makes little difference, but if opponent is on the margin of calling/folding, his subconscious will recall that you had TT last hand. He will overrate the likelihood of you having a ten.
This has a more frequent impact when you have just been to a showdown with something like, say, AJo (which loses a smallish pot) and you pick up QJs the following hand. Your problem now is that the subsconscious of your opponent is now likely to help him make the right decision for the wrong reasons. He is going to overrate the chance of you having a jack, because of anchoring. Unfortunately, you do have a jack. In addition, you lost the previous hand. 'Anchoring' in this instance works against you, because your opponent's subconscious is saying 'this guy gets jacks a lot' and also 'when he gets a jack, he tends to lose at showdown'.
Suppose the flop comes KJ3 two hearts and opponent has K5 of spades. Sometimes he might call you down and sometimes he might give up on the turn. If you had AJ the previous hand, he is more likely to call you down.
+++++++++
It was 20 years ago today, tra la tra la. 'Black' Monday wasn't really that black, in retrospect Mr Potts on 'Wake Up To Money' this morning came up with some nice narrative fallacies while stating how it was 'the buying opportunity of the century'. I suspect that all these guys are wel-versed in the ways of Taleb, but it does not suit their public persona to admit that, basically, er, we haven't really got a clue what's going to happen next week, let alone next year.
great concept
Date: 2007-10-19 08:42 am (UTC)The most pressing question when I openend your blog for me this morning was: "when will he comment on the whole AP scandal???"
on a related note: is big dave d ever returning on the blogging scene again? there would be so much stuff he could write about, it's hard to believe his fingers aren't itching...
Great post!
Marc