GTO Poker Theories - Bandwidth Tax

Scarcity takes up a lot of mental resources making climbing out of the small stakes harder than some might imagine.

One of the real gifts poker has given me is that it has been a great jumping off point to learn things from other disciplines like economics, AI, psychology and Game Theory. So here is a series of articles where I bring some of the most interesting things I have learned from other subjects outside of poker which are applicable in this game we know and love.

The concept of Bandwidth Tax is applied to humans in the context of scarcity and how it affects decision-making. Just like bandwidth limitations on internet networks, cognitive capacity bandwidth can also be limited by the scarcity of resources such as money, time, energy, etc. When the brain is heavily focused on a scarce resource, such as trying to pay bills, there is little cognitive bandwidth left for other important decisions like planning for the future.

Anyone who has been in debt no doubt knows how difficult it can be to climb out of it. Trying to get a promotion, or learn something new, or get in shape, is so much harder if you are in debt because that often consumes all your willpower and mental resources. 

Self-improvement and making decisions are much easier if you are not struggling financially. Money itself is cheaper if you are well off, for example, wealthy people can borrow money at lower interest rates or invest money. We have already talked about this when we discussed The Matthew Principle and cumulative advantage, or vicious and virtuous circles 

Low stakes bandwidth

There is a clear poker version of Bandwidth Tax and that is the barrier for low stakes poker players to climb the ranks. 

Low stakes are much easier than other stakes, don't get me wrong, but there are still a number of factors that stand in the way of aspiring low stakes grinders. The biggest one being rake, which is usually higher relatively than any other tier. You need to win at a much higher rate to move up the small stakes in poker than you do to move up the midstakes. 

A low stakes online player will not be able to migrate to live poker easily, where the games are much higher stakes because of the cost of running them. If you play NL2 online there isn't an equivalent live poker stake, so any live game you play is going to be for your entire online bankroll or more. 

If you are a low stakes player you invariably have a real life job or are a student. This is a literal example of Bandwidth tax where your priorities will always be paying the bills before poker can do that for you. 

While there is a wealth of free information out there, the cost of really good training is very high relative to a low stakes player's bankroll. Even having a tracking software or a subscription to a training site might be more than your entire poker bankroll. 

It's still easier to play low stakes poker than at any other level, but there are undeniable barriers at the small stakes that fit perfectly into this idea of Bandwidth Tax. 

What theories from outside of poker have helped your game? Let us know in the comments.

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