GTO Poker Theories: Mediocristan and Extremistan
Are the games you play in predictable or governed by outliers? An important question for anyone who understands risk in poker.
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 to this game we know and love.
Nassim Taleb, ever the intellectual provocateur, splits the world into two fictional realms to make sense of risk: Mediocristan and Extremistan.
In Mediocristan, the world is stable, tidy, and predictable. Things hover around the average. Your height, your shoe size, your daily step count; none of these are going to shock anyone at a dinner party. No one’s born 12 feet tall. The extremes exist, but they’re muted. It’s the land of bell curves and safe bets.
Then there's Extremistan. Here, the outliers run the show. One giant number can eclipse everything else, and the average becomes meaningless. Think of fame, viral hits, or financial windfalls. This is the domain where one freak event can rewrite the whole story. Most systems aren't built for this level of volatility. They assume a bell curve when they’re really up against a dragon curve.
MTTs vs Cash games
I think an obvious poker example is the difference between cash games and tournaments.
All of poker is in Extremistan to some extent, but within the game, cash games are much more predictable and steady. In that respect, they are closer to Mediocristan than tournaments.
The best players, practising bankroll management, in cash games will have predictable results over the long term.
Tournaments, by comparison, are in Extremistan. The best players will win, but variance creates massive outliers. The best example is the Main Event. The reality is that the best 30 players in the world likely will never win the Main Event, and some players who are barely winners have won it. Some players can use the Main Event as a springboard to even more success they would never have had otherwise.
This is not a surprise, and it is what tournament players have signed up for. Deep down, there is something we probably appreciate about the variance compared to cash game players. We are more at home in Extremistan.
What theories from outside of poker have helped your game? Let us know in the comments.
