Virtual economies of online games

BoyRacer · February 13, 2010, 6:05pm

Virtual economies of online games -> mydigitalfc.com/gadgets/virt … -games-103

In-game capitalism may give insight into how nations behave in real world, with all the financial scams
Virtual economies of online games

Eyjolfur Gudmundsson is a very unlikely central banker. While he spends his days thinking about inflation and monetary growth, his jurisdiction exits only in the virtual world of Eve Online, a massively multiplayer online (MMO) game set against a science fiction universe.

Gudmundsson is the chief economist for the Iceland developed game in which around 200,000 players take part in an intergalactic military and capitalistic tug of war.

Online gaming has already taken the world by storm. With players for a game like World of Warcraft at around 11.1 million (and growing) it sure has a knack for taking away hours off a gamer’s life. Now a unique if not uber-capitalistic phenomenon of virtual economies has evolved. As developers introduced trading of in-game goods amongst members, they need standardised data about the economy helping them track prices and make investment decisions. Traditional economic theories are being tested in this player-controlled game world. As in Eve, the economist watches complex mathematical simulations of price bubbles, designing ‘sinks’ that can soak up excess money when there is a glut.

Researchers have tracked games such as EverQuest II, another MMO, to test hypothesis regarding the choices that societies and individuals make. After studying more than 300 million ‘transactions’ in one of the fantasy worlds in the game, researchers were able to calculate the GDP of one of the game servers that hosted it. As more people flocked to that world, spending in-game money on new items, inflation spiked to more than 50 per cent in just five months. This kind of volatility is seen either during the time of war or in developing economies.

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