[MUD-Dev] DGN: MMOG Game Economies

Christopher D. Chapman chris at chapmanholdings.com
Thu Nov 10 07:54:35 New Zealand Daylight Time 2005

On 11/3/05, Paolo Piselli <ppiselli at yahoo.com> wrote:

> Without scaling commodity prices, you may have had excess capital
> in the system, but at least everyone could afford the basic vendor
> commodities.

i just don't think i'm being very clear, so you'll have to excuse my
fits and spurts of thoughts as i try to effectively communicate what
is in my head.  first, a few absolutist statements:

inflation is a function of average player wealth.

commodities must have relatively non-scaling prices.  (isn't that
part of the definition of commodity?)

successful mmo game economies != real world economies.

i put that 'successful' in there because you can model mmo game
economies after real ones, but they will never be successful.  no
one wants to play in a game they have very, very little chance of
winning or that is more about maintenance than new achievement.
that's the reason people play games -- to escape the drudgery of the
real world where they are a nobody and enter a world where they can
(relatively) easily become a somebody.  there is a small modicum of
skill involved in being successful in a game, but nothing even
remotely close to the scale of skill and luck it takes in the real
world to win.

what we can draw from that is that, in an mmo, average player wealth
increases enormously.  it has to or it wouldn't be fun.  now, by
'wealth', i don't necessarily mean cash on hand.  i am talking about
earning potential a.k.a. 'power.'  and, player power in mmo's
increase on an exponential scale -- at least until they hit some
arbitrary level cap.  i know this is on an exponential scale because
a level 5 player is not half as powerful as a level 10 player.

so, now, we need to determine the average wealth, right?  well, you
have to take into effect time played.  again, not like the real
world.  time spent in the game almost always equates to large gains
in wealth.  time spent in the real world almost always equates to
wealth stagnation.  you can argue 'investments' as a wealth gain
over time in the real world, but for the average household, how is
10% per year(!)  of whatever meagre sum of money they have left over
after their regressive costs (mortgage, food, clothes, etc. also
known as 'money sinks' and 'non-scaling' commodities) going to yield
them an 'increase' in wealth?  in the real world, you need money to
make money.  in a game economy, everyone walks in naked on one side
and strolls out a knightly, bejeweled, rich dragon slayer on the

for example, take the average net worth of everyone (monetary value
of all of everyone's possessions / number of players) with more than
5 hours invested in the game and store that total.  wait one month,
repeat.  there is going to be a massive, massive gain there.  keep
in mind this should apply only to successful games.  you can always
just keep nickel and diming your players to death with different
fees they have to pay based on power/property/tax brackets, etc. --
but then, you are risking alienating your players.  for proud,
chest-pounding proof check out this marvelous recreation of a boring
real world economy by the folks over at star wars


then, compare the number of money sinks to the player base between
swg and wow.

in wow, i would bet that the vast majority of the money coming out
of the system is coming from the training costs and not all of their
flat, regressive style 'taxes.'  i don't think they nickel and dime
the player nearly as much as swg does.  what more proof do you need
than the terribly disproportionate subscription base?  successful
mmo's (will) have a couple vanity money sinks and a scaling
(proportionally related to player power) 'cost of doing business'
type model.  whether that's paying cash to spend xp or putting level
requirements on every single item while keeping the cost the same
(for example, a level 50 only sword costs the exact same as a level
1 only sword -- you just have to be level 50 to get it.), both of
which rake the dual currency of xp and gold out of the equation.

no matter what, there is an equilibrium that needs to be reached
between annoying players by forcing them to spend money and enticing
them to place their money in something where they feel it is well
spent.  the players are in your game not voluntarily, but they
actually pay to play it.  the least we can do is offer them some in
game value for their gold and not just forcefully leech it out of

unlike the real world, gamers have a choice on whether or not to
participate.  that, in and of itself, has a profound effect on the

anyway, sorry about the rambling post.  i was all over the map
there. so much for effective communication.  *sigh*

> This is a very interesting discussion, but theories about
> controlling inflation must be a common topic in economics, and we
> should not pretend to be able to reinvent such a well-studies
> field.  Does anyone have any good references for background
> reading on this material?

agreed in that it's interesting.  i'm not sure we've ever really
seen anything like this in the real world, however, so i seriously
doubt there is really anything to model it after.  if there was,
someone much smarter than us would have fixed it.  i'm afraid that
we, as a community, will need to reinvent it.
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