Understanding financial crisis via Card Games…Bridge players vs Poker players

A terrific paper from Leonardo Becchetti, Maurizio Fiaschetti  and Giancarlo Marini ( Economics dept, University of Rome).

In card games, bridge players are seen as more team-believing and altruistic. In poker games, players are seen as individualistic and selfish. Apparently Akerlof and Shiller in their famed book suggested that there are more poker players these days which has led to current bad practices in financial markets.

The authors evaluate this hypo of  Bridge/ Poker players being more trustworthy/selfish. They find the hypo to be true:

There may be a nexus between card games and financial markets. Akerlof and Shiller (2010) ask whether the decline in the number of bridge players and the growth in the number of poker players may have led to the current bad financial traders’ practices which are responsible for the global financial crisis. The reason is that bridge is a cooperative game generally played without monetary payoffs, while poker is an individualistic game with monetary payoffs. We simulate trust and dictator game experiments on a large sample of affiliated bridge and poker players. We find that bridge players make more polarized choices and send significantly more than poker players as trustors, a result which is reinforced when corrected for risk aversion and dictator giving. Overall, our findings do not reject the hypothesis that bridge practice is associated with a relatively higher disposition to team reasoning and strategic altruism.

 Fascinating read. Technical though.

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