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In chess, compensation is the typically short-term positional advantages a player has in exchange for typically material disadvantage. Short term advantages involve initiative and attack.
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Compensation includes:
Polugaevsky versus Evans
A rook on the seventh rank (the opponent's second rank) is usually very powerful, as it threatens the opponent's unadvanced pawns and hems in the enemy king. A rook on the seventh rank is sufficient compensation for a pawn (Fine & Benko 2003:586). In this position from a game between Lev Polugaevsky and Larry Evans, the rook on the seventh rank enables White to draw, despite being a pawn down (Griffiths 1992:102–3).
Spassky versus Fischer
A famous 1960 game between future World Champions Boris Spassky and Bobby Fischer began with a King's Gambit opening. White sacrifices a pawn on his second move:
1. e4 e5 2. f4 exf4 3. Nf3 g5 4. h4 g4 5. Ne5reaching the position shown. Fischer examines an alternate fifth move for Black:
5... h5 6. Bc4 Rh7 7. d4 d6 8. Nd3 f3 9. gxf3 Be7 10. Be3 Bxh4+ 11. Kd2 Bg5 12. f4 Bh6 13. Nc3reaching the following position, where Fischer explains "White has more than enough compensation for the pawn." (Fischer 2008:123)