It is, then, the intent of this book to dissipate the mystery, myths, and misconceptions
that abound in the realm of gambling and statistical phenomena.The mathematical theory of gambling enjoys a distinguished pedigree. For
several centuries, gamblers ’ pastimes provided both the impetus and the only
concrete basis for the development of the concepts and methods of probability
theory. Today, games of chance are used to isolate, in pure form, the logical
structures underlying real-life systems, while games of skill provide testing
grounds for the study of multistage decision processes in practical contexts. We
can readily confi rm A.M. Turing’s conviction that games constitute an ideal
model system leading toward the development of machine intelligence.
It is also intended that a unifi ed and complete theory be advanced. Thus,
it is necessary to establish formally the fundamental principles underlying the
phenomena of gambling before citing examples illustrating their behavior. A
majority of the requisite mathematical exposition for this goal has been elaborated
and is available in the technical literature. Where defi ciencies remain, we
have attempted to forge the missing links.
The broad mathematical disciplines associated with the theory of gambling
are Probability Theory and Statistics, which are usually applied to those
contests involving a statistical opponent ( “ nature ” ), and Game Theory, which
is pertinent to confl ict among “ intelligent ” contestants. To comprehend the
operation of these disciplines normally requires only an understanding of the
elementary mathematical tools (e.g., basic calculus). In only a few isolated
instances do rigorous proofs of certain fundamental principles dictate a descent
into the pit of more abstract and esoteric mathematics (such as, Set Theory).
If this book is successful, readers previously susceptible to the extensive
folklore of gambling will view the subject in a more rational light; readers previously
acquainted with the essentials of Gambling Theory will possess a more
secure footing. The profi ts to be reaped from this knowledge strongly depend
on the individual. To any moderately intelligent person, it is self-evident that
the interests controlling the operations of gambling casinos are not engaged
in philanthropy. Furthermore, each of the principal games of chance or skill
has been thoroughly analyzed by competent statisticians. Any inherent weakness,
any obvious loophole, would have been uncovered long ago; and any of
the multitude of miraculous “ systems ” that deserved their supernal reputation
would have long since pauperized every gambling establishment in existence.
The systems that promise something for nothing inevitably produce nothing for
something.
It will also be self-evident that the laws of chance cannot be suspended
despite all earnest supplications to the whim of Tyche or genufl ections before the
deities of the Craps table. Such noumena cast small shadows on the real axis.
In the real world there is no “ easy way ” to ensure a financialprofi t at the
recognized games of chance or skill; if there were, the rules of play would
soon be changed. An effort to understand the mathematics validating each
game, however, can produce a highly gratifying result. At least, it is gratifying
to rationalize that we would rather lose intelligently than win ignorantly.