Real World Economics in Virtual Worlds

While it may seem on the surface that a Virtual World is simply a system of socialization or entertainment, there is much more beneath the surface. One of the key factors that drive many virtual worlds are real world economic factors, to the point that the virtual money in many of these games have a monetary exchange rate. The most infamous example of this is gold farming in World Warcraft, where people play the game as much as possible to make as much virtual gold as they can so they can then sell this virtual money to players who do not have time to play the game as much for hard currency. This is frowned upon most players as cheating and deflates the value of the virtual money, but it is done despite protests.

This belief is not universal among all game companies. Everquest, one of the first virtual worlds has an acution house within the game where players can use real money to bid on ingame items, as well as directly buy games from shops and other players.

The most extreme example of the real and virtual economies colliding is the game Entropia Universe. where every item made by a player or bought by a player is worth exactly 1/3 of a dollar. Players can deposit money into their game accounts to buy more virtual goods and in a strange twist, sell virtual goods off to other players and the game itself for market value to attempt to make a profit

With so much money floating around these virtual worlds, the blurring between real and virtual property will probably continue until there is no distinction.

Gold Farming- http://en.wikipedia.org/wiki/Gold_farming

Everquest auctions- http://news.cnet.com/2100-1040-823260.html

Most valuable piece of online property ever!!-Expensive Island

Life in a virtual world

When thinking of the concept of the virtual world. images of simple 3d worlds such as Second Life usually pop into a persons mind, however the reason for this stems more from Second Life being embraced as part of pop culture and less from it being a successful virtual world.

In fact, Second Life has several flaws that stop it from being a true virtual world, the two primary flaws being that the game does not have a unified player-base and game-world. Second life is divided into two large servers, one for players 17 and under and the other for 18 and above, while this partition does serve to protect younger players from some of the more "adult" sections of Second Life, a virtual world can not be divided, it must be unified. Furthermore, Second life does not have a unified game-world, rather the game is comprised of thousands of islands, many constructed by individual players for private use. This sense of having your own private world is a key point of Second Life, however it does not contribute to a unified virtual world.

I feel a better example a of unified virtual world is the game EVE Online. EVE allows players to explore a large fictitious galaxy that is ever expanding, and all players who play EVE play in the same galaxy. As everyone must play in the same game-space, players must compete for resources and authority and form player-made corporations to better control entire regions of the galaxy. From this situation a player is able to achieve several goals in EVE that they could not in Second Life. One such goal is fame, as all players are interconnected in one large world then a large success can reverberate throughout the player community, this can even lead to authority, as one player can lead others to control economic goals and military goals that can have significant impact on how others play EVE.

For more information on EVE and Second life please follow the links

http://en.wikipedia.org/wiki/Eve_Online

http://en.wikipedia.org/wiki/Second_Life

http://pc.ign.com/articles/100/1002527p1.html  -Article about the banking crisis within EVE during 09

Vitural Worlds: What are they?

All the world's a stage,
And all the men and women merely players;
They have their exits and their entrances;
And one man in his time plays many parts-William Shakespeare

A virtual at its core is a simulated reality where people can interact with each other through player made representations(sometimes referred to as Avatars). within these realities people can interact, form social groups and bond and create communities just as if they were communicating in everyday life. This worlds can range from simplistic socializing programs such as Second Life, to worlds of intense complexity and competition as with the online RPG genre. All these worlds are linked however by a common theme of player interaction and communication, which is a a central element of the virtual world.

In Future posts we will look at

-Popular virtual worlds and their appear.
-Virtual world economics and their affects on player interaction.
-Entertainment vs Education, what types of virtual worlds provide educational value.
-Offline virtual worlds, can AI interaction make up for lack of player interaction?

www.eecs.harvard.edu/~nesson/e4/ed-vw-1.0.pdf-follow link for more information