Practical Poker Math

Two of the most basic assumptions of Game Theory are that
all players
1. Have equal common knowledge
2. Will act in a rational manner.
But in poker, while all players at any given table have access to
the same common information, not all of them are smart
enough to do something with it. Players who know more about
odds and probabilities, and whose instincts and keen observation
enable them to better process the common knowledge
around them, will take far better advantage of this information
and will have correspondingly higher positive expectations.
So while all the players at the table have access to the same
common knowledge, some players are able to base their
actions on knowledge that is more complete. That all players
in all games will always act rationally is never a safe assumption
in poker.
Equilibrium versus Evolution
According to the “Nash Equilibrium,” a game is said to be in
a state of equilibrium when no player can earn more by a
change in strategy. It has been argued that, using the process
of backward induction, players will evolve their strategies to
the point of equilibrium.
In poker, the astute player’s strategy will always be in a state
of evolution so that his opponents, in order not to be dominated,
will also be compelled to modify their strategies. In a
real game of poker there is constant evolution and therefore
hardly ever a point of absolute equilibrium.
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Game Theory and Poker