EQ2 Used for Economic Research

I just ran across this piece describing economic research that Dmitri Williams and Edward Castronova are carrying out using datasets from EQ2 provided to them by Sony.

Don't worry, it's all anonymous. Williams refers to virtual worlds as the equivalent of rat mazes and petri dishes. The main advantage of a virtual world is clean data. Everything is there, to the last transaction, and on a fairly large scale. It can be argued that are many artificialities in a virtual economy, such as EVE or EQ2. That's why they make the analogy to a petri dish. There's lots of economic behavior going on, and it can be tracked with complete accuracy.

Williams and Castronova's article opens with a fascinating quote:

In The Treachery of Images (1928–9), René Magritte painted a picture of a pipe above the words: ‘Ceci n’est pas une pipe’ (‘This is not a pipe’). In virtual worlds, there are no pipes either, yet users manage to use virtual objects and characters in a vast array of social transactions. When observers see a virtual sword on the computer screen, the paraphrase of Magritte’s admonition – ‘Ceci n’est pas une épée’ (‘This is not a sword’) – surely comes to mind. However, is the sword only an image? Or does it become invested with some kind of socially constructed realness as a result of playing a role in human communication and exchange?

Which really reminds me of the phrase you hear in MMO's a lot: "It's just a game." They go on to describe their plan:

By examining transactions from a large commercial virtual world with hundreds of thousands of players, the current mapping test concerns whether the items and economic behaviors within a virtual world function in the same way that they would in the real world – where, it is noted, currency is also largely representational (a dollar is only a piece of paper, but is assumed to have a value in gold backed by the US treasury). Do the same behaviors that make a US dollar bill economically ‘real’ also make a virtual sword economically ‘real’? Does economic behavior map from the real world into the virtual?

What may have started out as unreal, through our time and effort becomes real to us. Now the associations and emotions we have around it may well have a different slant: We are likely to be less risk averse, for instance. There's a less scholarly discussion of this on the EVE forums, addressing the question, "Is it just a game?"

One of my favorite quotes from that discussion, which isn't terribly EVE specific, and worth a read:

I used to bring this up to the goons now and then. They'd literally spend hundreds of hours planning and organizing ways to annoy people, and then when some random guy who only plays a couple hours a week complained they'd say "it's just a game".

Props to Sony for providing their data to economic and sociological research.

Interdependence: A Review of EQ2

Brian "Psychochild" Green takes on the issue of interdependence, and uses crafting as an example of design for interdependence. In particular, he cites EQ2:

EQ2 took this to new levels when it launched. In addition to a unique interactive crafting system, most of the components were created by other professions. I didn't play back when the original system was in place, but as I remember reading: A scholar required ink, paper, and a quill to create scrolls. A scholar could only make paper and had to get the other components from other crafters. Even producing something like ink was a complex multi-step process: you had to process dyes then make the inks. If prices weren't good (or you didn't just roll an alt), it could be brutal for a crafter. Most serious crafters had alts that made the materials and passed them along through shared bank slots.

Yep, been there, done that. For the record, there were two stages of the revisions to crafting to get to the basic system we have today. The first one removed interdependence by introducing new skills called Geomancy, etc. and recipes based on them that would allow you to make all your own components yourself. But you wouldn't get skill gains in your primary crafting skill from doing so. And you wouldn't gain experience either.

A much later change is what changed making a skill from 11 combines to 1. That was huge, and probably necessary. 11 combines to make an improved skill was just too much. The market for them failed. People were rather irritated when friends asked them to make the improved skill for them, because it was a royal pain in the butt.

In a sense, this is a market failure. All of these problems are market failures. I'm not sure I see a way around that though. Let me explain. If the ink (probably takes 7 of those 11 combines for a combat art) were widely available at a price that made advanced crafters think "Oh, why bother with logging on my alt and making it, I'll just buy some" that would be a functioning market. Let me give you an example of what I mean.

Just last night my buddy Phritz was making an airplane in the guild hall. Yes, it's kind of a hobby with him, making odd items by assembling the in-game house items in some unusual fashion. Creativity in action. He was browsing the broker looking for something he could make a fuselage out of and found some sort of chest that he could make. He asked me to see if my spouse could log in and make some with her crafter. I said I could, but he should check the price on the broker first. He reported that there were 8 for 1g each, and yeah, at that price he would just buy them. That's the sort of pricing that makes markets work.

In order for that to happen, there would have to be someone who thinks, "Making inks is fun!" or alternatively, "I need some cash and making and selling ink is the best way I personally have of doing that, at least for right now."

Most players have high level alts. One way of making money is to go hit a high gray zone and just loot body drops. This activity can be interrupted at any moment safely, since the zone is gray, and your autoattack will probably win the day. So making ink has to be at least as profitable as that. And if we're talking low-level ink, the problem gets worse. So instead of thinking "The best thing I can do to make plat is craft these components," the thought tends to be, "I'll be damned to have spent all that time leveling my crafting and buying/harvesting components just to make a few silver per each product that took me half an hour to produce."

Making ink for sale on the broker never worked economically. You couldn't charge enough to make them worthwhile. Some tried, I guess they had some success. There's always someone out there with more money than time. It was like that with deer meat for a while, which was a tier 1 harvestable needed for a HQ. A t1 character could sell them for 1g, which was a LOT of money for that level. This is good.

But nobody spends more than a day at tier 1 any more.

(By the way, this touches one of my favorite pet peeves about LOTRO and WOW. Auctions, especially those that require a posting fee, reduce the amount of good available. I suspect by quite a bit.)

Things are different, though hardly better in LOTRO. Routinely on the broker you will see raw materials selling for more than the intermediate components made from them. Which means that you will only make those intermediates if it's necessary to do so to level up. And the intermediates aren't going to be available when you need them.

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However, EQ2 has put together a few interactive crafting bits that do work. First the tradeskill epic. It requires you to have someone of each and every tradeskill class make you something that is NOTRADE. So you can't do it with an alt. You only need one combine from them, and they are all, or have been, in the same boat. It worked. I did some combines for strangers, and they did some for me. And I helped, and got help, from friends.

The second example of interactivity are the tradeskill missions. I did quite a few of these until I got all the rewards and faction I wanted. You can do these solo, but having more people there makes it go a lot faster, and you get the same rewards. Mostly. Plus there's a story there. So, it's a nice way to spend an hour with some buddies. I never did it with strangers though.

The Continuing Saga

...of Blue Yeti Fur



Don't Do It, Etchii! It's not too late! Well, maybe it is...

Observant readers will note that I'm listed there too, in my pathetic attempt to unload my toxic assets at something approaching their real valuation rather than marking to market. It's obvious that we are in a fear-soaked trough now, and that in the long run, the market will realize the value of these assets.

Oh, and in the long run you might be dead, but I'm a high elf, so I'll still be alive (and looking fabulous, of course.) I'm going for 4000!