Gambler's conceit
Encyclopedia
Gambler’s conceit is the fallacy described by behavioral economist David J. Ewing, where a gambler believes they will be able to stop a risky behavior while still engaging in it. This belief frequently operates during games of chance, such as casino
games. The gambler
believes they will be a net winner at the game, and thus able to avoid going broke by exerting the self-control necessary to stop playing while still ahead in winnings. This is often expressed as “I’ll quit when I’m ahead.”
Quitting while ahead is unlikely though, since a gambler who is winning has little incentive to do so, and is in fact rewarded for continuing to do so by their winning. Once in the throes of a winning streak the individual may even become convinced that it is their skill, rather than blind chance, causing their winnings, or good luck on their side, and thus it seems especially senseless to stop while continuing to win.
Contrast this to the Gambler's Fallacy
where a losing gambler is convinced it is necessary to continue gambling because a streak of bad luck "has to" end at some point. The gambler's conceit frequently works in conjunction with the gambler's fallacy, convincing players that it is necessary to continue playing while winning, and necessary to continue playing while losing. Together, the gambler's conceit and gambler's fallacy keep players playing, whether winning or losing, until they eventually go broke, also known as Gambler's ruin
.
As casinos have a house advantage in games of chance, a casino is more likely over time to take a player’s money than a player is to win money from the casino, and thus it is to the casino's advantage to keep a winning player playing in order to recoup their losses. Casinos thus frequently encourage winning players to continue playing. An example can be seen in the Martin Scorsese
movie Casino
where Robert De Niro
's character ensures that a high stakes gambler continues to gamble to ensure that the money won returns to the casino. On a smaller scale, casinos offer players free alcoholic drinks to encourage them to keep gambling.
Another illustration of the gambler's conceit is in cases of harmful physical addictions, such as smoking
or alcohol
. Although illness or even death are nearly certain if the addict continues to use, the addict rationalizes that they will be able to quit before becoming ill, while still indulging their physical addiction until then. Thus, while continuing a risky action the addict believes they will be able to stop while continuing to perform it.
Casino
In modern English, a casino is a facility which houses and accommodates certain types of gambling activities. Casinos are most commonly built near or combined with hotels, restaurants, retail shopping, cruise ships or other tourist attractions...
games. The gambler
Gambling
Gambling is the wagering of money or something of material value on an event with an uncertain outcome with the primary intent of winning additional money and/or material goods...
believes they will be a net winner at the game, and thus able to avoid going broke by exerting the self-control necessary to stop playing while still ahead in winnings. This is often expressed as “I’ll quit when I’m ahead.”
Quitting while ahead is unlikely though, since a gambler who is winning has little incentive to do so, and is in fact rewarded for continuing to do so by their winning. Once in the throes of a winning streak the individual may even become convinced that it is their skill, rather than blind chance, causing their winnings, or good luck on their side, and thus it seems especially senseless to stop while continuing to win.
Contrast this to the Gambler's Fallacy
Gambler's fallacy
The Gambler's fallacy, also known as the Monte Carlo fallacy , and also referred to as the fallacy of the maturity of chances, is the belief that if deviations from expected behaviour are observed in repeated independent trials of some random process, future deviations in the opposite direction are...
where a losing gambler is convinced it is necessary to continue gambling because a streak of bad luck "has to" end at some point. The gambler's conceit frequently works in conjunction with the gambler's fallacy, convincing players that it is necessary to continue playing while winning, and necessary to continue playing while losing. Together, the gambler's conceit and gambler's fallacy keep players playing, whether winning or losing, until they eventually go broke, also known as Gambler's ruin
Gambler's ruin
The term gambler's ruin is used for a number of related statistical ideas:* The original meaning is that a gambler who raises his bet to a fixed fraction of bankroll when he wins, but does not reduce it when he loses, will eventually go broke, even if he has a positive expected value on each bet.*...
.
As casinos have a house advantage in games of chance, a casino is more likely over time to take a player’s money than a player is to win money from the casino, and thus it is to the casino's advantage to keep a winning player playing in order to recoup their losses. Casinos thus frequently encourage winning players to continue playing. An example can be seen in the Martin Scorsese
Martin Scorsese
Martin Charles Scorsese is an American film director, screenwriter, producer, actor, and film historian. In 1990 he founded The Film Foundation, a nonprofit organization dedicated to film preservation, and in 2007 he founded the World Cinema Foundation...
movie Casino
Casino (film)
Casino is a 1995 crime drama film directed by Martin Scorsese. It is based on the non-fiction book of the same name by Nicholas Pileggi, who also co-wrote the screenplay for the film with Scorsese...
where Robert De Niro
Robert De Niro
Robert De Niro, Jr. is an American actor, director and producer. His first major film roles were in Bang the Drum Slowly and Mean Streets, both in 1973...
's character ensures that a high stakes gambler continues to gamble to ensure that the money won returns to the casino. On a smaller scale, casinos offer players free alcoholic drinks to encourage them to keep gambling.
Another illustration of the gambler's conceit is in cases of harmful physical addictions, such as smoking
Smoking
Smoking is a practice in which a substance, most commonly tobacco or cannabis, is burned and the smoke is tasted or inhaled. This is primarily practised as a route of administration for recreational drug use, as combustion releases the active substances in drugs such as nicotine and makes them...
or alcohol
Alcohol
In chemistry, an alcohol is an organic compound in which the hydroxy functional group is bound to a carbon atom. In particular, this carbon center should be saturated, having single bonds to three other atoms....
. Although illness or even death are nearly certain if the addict continues to use, the addict rationalizes that they will be able to quit before becoming ill, while still indulging their physical addiction until then. Thus, while continuing a risky action the addict believes they will be able to stop while continuing to perform it.
See also
- Gambler's ruinGambler's ruinThe term gambler's ruin is used for a number of related statistical ideas:* The original meaning is that a gambler who raises his bet to a fixed fraction of bankroll when he wins, but does not reduce it when he loses, will eventually go broke, even if he has a positive expected value on each bet.*...
- Gambler's fallacyGambler's fallacyThe Gambler's fallacy, also known as the Monte Carlo fallacy , and also referred to as the fallacy of the maturity of chances, is the belief that if deviations from expected behaviour are observed in repeated independent trials of some random process, future deviations in the opposite direction are...
- Inverse gambler's fallacyInverse gambler's fallacyThe inverse gambler's fallacy, named by philosopher Ian Hacking, is a formal fallacy of Bayesian inference which is similar to the better known gambler's fallacy. It is the fallacy of concluding, on the basis of an unlikely outcome of a random process, that the process is likely to have occurred...
- Behavioral economics