Moving Up Is Hard To Do

[Black Peter]

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It's also rational to take -EV gambles, like getting fire insurance for your house and stuff like that.

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What you're describing is part of Prospect Theory, which is what won Daniel Kahneman the Nobel Prize in Economics. And while he described this phenonenom, he didn't advocate it, and in fact described it as a human ERROR (i.e. irrational) in judgement*... unless the consequences of NOT taking that risk were unacceptable (e.g. your house burns down and you have nothing or you die and your family is bankrupted). The only time i see this being relevant in poker is in a tournament where you have a limited amount of time/hands to win the big prize. In day-to-day poker, taking -EV risks will lose you money in the long run.


* Tversky & Kahneman. (1974). Judgments under uncertainty: Heuristics and biases. Science, 185, 1124-1130.

Tversky & Kahneman. (1981). The framing of decisions and the psychology of choice. Science, 211, 453-458.

Kahneman & Tversky. (1984). Choices Values and Frames, American Psychologist, 39, 341-50.

Kahneman, D. (1991). Judgment and decision making: A personal view. Psychological Science, 2(3), 142-145.

Kahneman, Daniel, and Amos Tversky, "Prospect Theory: An Analysis of Decision under Risk", Econometrica, XVLII (1979), 263-291.


I recommend all these papers to anyone learning poker.