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Measuring Skill and Chance in Games




Speaker: Prof Jörg Oechssler (University of Heidelberg)

Series: Department of Economics Seminar Series 2017-18

This seminar is part of the Department of Economics Seminar Series 2017-18. The seminars are open to all - no registration necessary. If you would like to receive email notification of the Department’s seminars, please send your request to

Online and offline gaming has become a multi-billion dollar industry. However, games of chance are prohibited or tightly regulated in many jurisdictions. Thus, the question whether a game predominantly depends on skill or chance has important legal and regulatory implications. In this paper, we suggest a new empirical criterion for distinguishing games of skill from games of chance: All players are ranked according to a "best-fit" Elo algorithm. The wider the distribution of player ratings are in a game, the more important is the role of skill. Most importantly, we provide a new benchmark ("50%-chess") that allows to decide whether games predominantly depend on chance, as this criterion is often used by courts. We apply the method to large datasets of various two-player games (e.g. chess, poker, backgammon). Our findings indicate that most popular online games, including poker, are below the threshold of 50% skill and thus depend predominantly on chance. In fact, poker contains about as much skill as chess when 3 out of 4 chess games are replaced by a coin flip (with Peter Duersch and Marco Lambrecht).

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When & where

3.00pm - 3.00pmWednesday 28th March 2018

D112 Rhind Building City, University of London St John Street London EC1R 0JD United Kingdom