Online Game Economies

1
Online Game Economies

• the rat killer entrepreneurs

2
Real Virtual World Differences

• Have routine, fixed-income jobs
• Uneven job opportunities from circumstance
• The poor fill a needed gap (janitor, etc.)
• Based on needs
• Inflation has harsher penalties
• Finite resources to be acquired and used
• Not meant to be fun

• Forced to be entrepreneurs
• Everyone starts out as equals
• The poor are not needed / weeded out
• Based on wants
• Inflation is more tolerable without a fixed
  income
• Potentially infinite resources
• Has to exclude real world aspects for sake of
  gameplay and fun

3
Virtual Economic Cycle Closed Economy
Flow of Items
4
Closed Economy Problems

• Item Hoarding Players accumulate and store
  items in their inventories
• Hoarding prevents items from distributing and
  eventually decaying back into resources
• Finite resources in closed-loop economy dries up
  and no more items can be produced by players
• Lack of items stagnates not only game economy,
  but the game world that depends on items (quests,
  spawning monsters, etc.)
• Dull world results in upset players who may leave
  the game
• To combat this, the nature of the economy has to
  change

5
Flowing Economy
Overly Complex Chart
6
Crafting

• The process of equipment
• and other goods manufactured
• by the player base
• Complements the adventuring
• and combat aspects of the
• game gives players something
• else to do in the world besides
• whack rats, orcs and rat-orcs
• Gives players the option of making useful items
  rather than having to venture out into dangerous
  areas for it
• With a robust crafting system, the lifespan of
  the game greatly increases because of the rise in
  player-exchange and the players desire to obtain
  valuable items

Player character making some crap
7
Crafting Contd.

• Many games use the skill through
• repetition method of crafting, wherein
• ones skill rises as you make more items
• in a particular craft
• Cheap junk items are often
• mass-produced when skilling up a craft,
• often saturating a certain market if the
• player isnt careful
• Usually, players will just sell said items to
• an NPC, which in turn creates new money in
  the economy
• Many crafters in a given game sell to NPCs while
  trying to improve
• their skills, creating enormous sums of
  money, raising overall wealth of game
• Not necessarily a bad thing, as normal items
  keep up with the high
• priced, sought-after pieces usually

Only 7,681 more Dragon Masks to go /sigh
/killself
8
Inflation and Exploits

• Inflation money enters the economy too quickly
  and destabilizes the market(s)
• Usually, the constant influx of money/item
  faucets and drains keeps prices stable
• A bug or exploit is often the cause of inflation
• Dishonest players will use these to create large
  sums of money for themselves
• Economy becomes saturated by the flood of new
  money, driving up the price of wanted items
• Normal crafted items do not rise in price as
  greatly, creating market imbalance
• After the bug/exploit fix, the market will take a
  long time to stabilize again

9
Real Money Trade

• EVIL
• RMT often work together for a
• company to sell ingame currency
• for real world currency
• Represent a small portion of
• the player base that is responsible
• for a great deal of inflation
• Resort to hacking and exploits
• to obtain large sums of money
• Also operate by farming nonstop, camping /
• monopolizing monsters that drop valuable
  items
• Market for buying ingame currency is depressingly
  large

Typical gold farmer
10
Deflation and the Winter of MMOs

• The eventuality of an economy with items that do
  not wear and decay back to nothing
• While the player base remains relatively
  constant, the number of resources from the
  infinite faucet continues to increase
• Demand drops as time goes on and players obtain
  the gear they want, but the supply remains steady
• Resources / goods come from farmers trying to
  profit, or endgame guilds repeatedly killing
  god monsters for valuable equipment who also
  happen to drop crafting materials
• RMT bannings also take a large amount of money
  out of the economy because they have bank mules
  that they store their gold on for customers

11
Conclusion

• The market will bounce back, either through
  developer intervention or enough time for the
  economy to settle
• Consistent updates with new goods and quests are
  necessary both to fix parts of the economy and to
  prevent stagnation of the game world
• Real and virtual world economy are similar, but
  the differences in world natures makes it
  inaccurate to call game worlds simulations of
  real economies
• Online worlds only truly die from massive
  disinterest