Monday, October 1, 2012

Gaming Economics

Here is an interesting (and kind of long) Washington Post article about economics in gaming:

Since it's pretty long I'll give you the jist. Economic Academics are using data from games such as Eve Online and Second Life in order to test and explore economic theory. Eve Online is a massive multiplayer online role playing game (MMORPG) in which players explore a large outer-space universe as a character that has a particular profession (miner, explorer, manufacturer, etc.) Because there are these "natural resources" that need to be mined and sold and manufactured in the game, the economists can study how players abide or don't abide to general theories of supply and demand. Moreover, the economists can study what happens when a shock to the system occurs as the programmers can manipulate amounts of "resources" in the game. It is a great tool for economists because they can use the entirety of data rather than taking a sample from the real-world. Moreover, its actual people instead of a computer simulation so it accounts for irrational behavior. So now gaming companies are hiring economists to better shape their games, and economists are looking to gaming companies to study their data. The only struggle is that game companies don't want to tailor/change their game dynamics to satisfy the experiments of the economists, because they still want the games to be fun.

But this is just another cool way that gaming has real-world benefits and applications, and games have their place in multiple academic disciplines.


  1. Great post and the Washington Post is my favorite newspaper.

    I like how a lot of teh economics go back to Second Life, because that game had a interesting model where people were actually making a living (real money) off of the currency that was perchased in the game.

    I'm sure we'll end up talking about it in class, but excellent eye on catching this.

  2. That was a really fascinating article! I learned a lot about Second Life in my internet law class, and there are so many real-world implications for that game. We watched part of a documentary that featured a woman who made a really good living from designing luxury items on Second Life, selling them for Linden Dollars, and then converting that to real money. There was also a married couple who had left their respective spouses after meeting on the game. (They later divorced because real life wasn't as wonderful as Second Life and neither of them was as hot as their avatar IRL.) Second Life is really interesting because the Linden Dollar is actually worth U.S. dollars (however bad the exchange rate is), and Second Life granted full intellectual property rights to their users. This came back to bite the company in a 2007 case called Bragg v. Linden. The game owners deleted Bragg's account after he used hacking to obtain an expensive piece of property in the game, and he sued them for effectively confiscating his property, which was worth thousands in U.S. dollars. Unfortunately, this case was settled out of court, so we won't know what precedent it could have set regarding virtual goods.