Financial Terms / M - N / Negative sum games
Negative sum games
Negative sum games are a concept in game theory in which value is destroyed; on average, players lose more than they gain. An example of a negative sum game is gambling on the roulette wheel, where there is a higher probability of losses when compared to gains as the house takes a cut.
If continued across many repetitions, playing negative sum games can lead to a complete loss of value.
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