Gambler's Fallacy
Statistical
Theory, Probability, Psychology, Gambling, Addiction
The gambler’s fallacy is one of several types of faulty
thinking common to people with gambling problems.
Gambler’s fallacy can involve either of the following:
 Thinking the system is biased in favour of certain
outcomes,
when it isn’t. This
is also known as reverse gambler’s fallacy.
 Assuming the combined outcome will conform closely to
the
marginal outcome probabilities,
even though each observation is drawn
independently.
For example,
let’s say an unbiased roulette wheel is spun
several times. If
the ball lands on red,
five times in a row, someone prone to gambler's fallacy might believe
one of the
following:
 Since red has shown up
so many times in a row, it must be a safe bet, therefore I should bet
red.
 Since red has shown up
so many times in a row, it must be black’s turn soon,
therefore I should bet
black.
In reality, black
and red would be equally likely to show up
next. Those who see
the roulette wheel
for what it is would realise that neither bet would be safer than the
other.
Sometimes
people are so conscious of avoiding the
gambler’s fallacy they end up applying it to scenarios where
they shouldn’t,
with the false assumption that the probabilities of each outcome are
equal. The
Monty Hall problem is an example of this.
