Poker is more skill than chance say economists Steven D. Levitt and Thomas J. Miles.

The pair found that the 720 players rated as highly skilled won an average of more than $1,200 each per event, or received a 30 percent return on their initial investment. All other players averaged a loss of $400 per event, 15 percent of their investment.

The differences are “far larger in magnitude than those observed in financial markets, where fees charged by the money managers viewed as being most talented can run as high as 3 percent of assets under management and 30 percent of annual returns.”

Statistically convincing to me is the fact that four people have won the main event of the World Series of Poker multiple times.

Four players have won the main event multiple times: Johnny Moss (1971 and 1974), Doyle Brunson (1976 and 1977), Stu Ungar (1980, 1981 and 1997) and Johnny Chan (1987 and 1988).

If poker were largely based on luck rather than skill, the odds of several people winning the WSOP multiple times each would be astronomically small. This data alone is enough to convince me.

(HT: Paul Hsieh.)

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