the rake in poker

[Losing all]

Maybe I wouldn't have taken it as insulting if it didn't come from one of the better players in the world? My brother is a national champ kickboxer, he doesn't punch me in the face every time I walk by.

[Syntax]

I know you were being condescending but "justified" wasn't the best choice of words for me. A much more appropriate phrase would have been "markup".

[Dingo Puppet]

Post deleted by Mat Sklansky

[Thythe]

Why does everyone think having "zero rake" is a step in the right direction? If Best Buy started giving away all of their store would that also be a step in the right direction? Why shouldn't card rooms charge the equilibrium price for rake?

The market is quite advanced and moves quickly to adjust to various conditions in the world such as technological changes, droughts, etc. Prices we see in stores are not just arbitrary guesses by business managers. They are an indication of the supply and demand of various services.

Most people here would know that in plotting demand we will have price on the y-axis and quantity on the x-axis. Given an increase in demand then, holding supply constant, we will see an increase in price and an increase in quantity. This is exactly what has happened with Party Poker in the last years. As people flocked to the site given a pretty stable amount of quality cardrooms, rake went up. It is inevitable. It isn't Party Poker screwing us over. The rake reflects the true conditions of the market.

If they were to decrease their rake, they would find an excess in demand which they may not be able to handle with their current software (we've even seen tournys crash due to an excess of people! Imagine if they decreased the rake of these tournys). Likewise if they increase it more, there would be an excess of supply. It's Econ101 people!

Edit to include that I am now an old hand! Yeeeaaah

[tyfromm]

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When I read this post, I was thinking about how this topic has been discussed 100 times, yet this thread will probably get 100 responses since Ray Zee started it.

-- Homer

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Who the hell is Ray Zee? What has he done for us lately? No one plays stud anymore. Hes just a gun toting Montana weirdo.

[Schneids]

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If they were to decrease their rake, they would find an excess in demand which they may not be able to handle with their current software (we've even seen tournys crash due to an excess of people! Imagine if they decreased the rake of these tournys). Likewise if they increase it more, there would be an excess of supply. It's Econ101 people!


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I don't think them offering a multi that is 150+11 instead of 150+12 is going to make one person decide to play it who normally wouldn't. Or even 150+5 for that matter.

Likewise, I do not think relating rake costs to economic models about supply and demand is totally fair and accurate. Where as most people who go out to buy a new television generally know what the "going price" of a TV is, new poker players are unaware of rake and its implications on the game. We've been through it many times already that a new player does not understand how 20 cents taken out of a $10 pot is going to effect their long term results versus 25 cents from a $10 pot. You cannot measure supply vs demand when the customer is unaware and clueless.

[Syntax]

Don't be so hard on "Losing All". He must be an affiliate and realizes that he is about to go through some very tough times and is feeling stressed at the moment. The livelihood of bottom feeding off the rake of his sign ups is about to be swept right out from underneath him. He's "losing all" as one might say. Just try to have a little understanding for the poor guy [img]/images/graemlins/wink.gif[/img]

[Jimbo]

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You cannot measure supply vs demand when the customer is unaware and clueless.


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Actually the law of supply vs demand has very little to do with whether or not the consumer has a clue.

Jimbo

PS: And for those insulting Ray Zee, they are truly the clueless.

[Thythe]

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If they were to decrease their rake, they would find an excess in demand which they may not be able to handle with their current software (we've even seen tournys crash due to an excess of people! Imagine if they decreased the rake of these tournys). Likewise if they increase it more, there would be an excess of supply. It's Econ101 people!


[/ QUOTE ]I don't think them offering a multi that is 150+11 instead of 150+12 is going to make one person decide to play it who normally wouldn't. Or even 150+5 for that matter.

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On the contrary, it is the people on these borders who influence price the most. Best Buy sells millions upon millions of DVDs every year. If say the price is $20 and no one would change their buying habits if the price was booted up to say $20.10, they should go ahead and do it.

As for your second point, it is pretty much entirely accurate. Economic models do typically assume perfect information and you are right that the average poker player doesn't really have any idea of the prices elsewhere. That being said, I think a lot of the model still holds...I will think about this further, though.

[Losing all]

I'm not an affiliate, prop, or shill for any site. Not even UB. Thanks for looking out for me, though.