
It all began with a strange email - julioc
http://blogs.valvesoftware.com/economics/it-all-began-with-a-strange-email/
======
xb95
I worked at CCP when they hired Eyjólfur. He came in without really knowing a
lot about the game world and made it his first job to learn as much as he
could about how the world actually worked.

Given that I was a foreigner who was working and living in Iceland, I didn't
have much of an evening social life. I was also one of the relatively few
employees (sadly) that were really active in the game in the advanced levels
of play -- 0.0, empire wars, etc.

Eyjólfur spent a bunch of evenings sitting with me while I played internet
spaceships. He asked tons of questions and really got to learn the universe,
or at least my corner of it. It was really interesting to work with him and
hear him talk about his thoughts as he was putting them together.

CCP used to publish the Quarterly Economic Newsletter, like this:

<http://cdn1.eveonline.com/community/QEN/QEN_Q3-2010.pdf>

They've since stopped doing that, but you can see from that example that it
used to be a fantastic resource. If you wanted to know the nitty-gritty
details about the universe of EVE Online, the QEN was hard to beat.

~~~
creamyhorror
[edit: reposted as top-level comment; I apologize for the repetition]

CCP's economist's reports are the real deal. The EVE game economy is I dare
say more developed and complex than most other games' - it has many kinds of
input factors and stages of production, and many of the production
facilities/resources are player-controlled and their fate determines on
political maneuvering, war and sabotage between player corporations (guilds).
The price of most items in EVE (ships, weapons, components, structures) is
determined by the state of production and speculation in the economy, so CCP
has to consider the economic impact of nearly every single change they make to
the game world.

If any of you folks are interested in reading about a truly fascinating,
active digital economy, you have to read the EVE economic reports and other
investigations of EVE. It's like reading about mining, manufacturing and stock
markets - against a background of eternal war between corporations - in far-
future space.

edit: links to additional content \----- <http://pc.gamespy.com/pc/eve-
online/855380p1.html>

>>> EVE Online was developed to have a very dynamic economy from the very
beginning. It was decided that "time" would be treated as a valuable player
resource: for that reason, raw materials were spread all over the galaxy map,
which takes hours to traverse. This created regional pricing. Interestingly,
there were no trade hubs built into the core game design -- players gradually
settled into certain areas and made their own pockets of population where
trade thrived.

>>> Gudmundsson had some fun examples of how intelligent virtual economies can
be. He showed a graph displaying the prices of a mineral in the game known as
Zydrine. Zydrine is hard to find in the EVE universe, but players had
discovered that killing a certain class of drone often leaves behind Zydrine
in the wreckage. This hole in the market led to lots of drone-farming, and
subsequently the price started to drop. Drastically.

The developers decided to tweak the drop rate and this change rolled out onto
the test server, unannounced, and mixed in with all sorts of other tweaks.
Still, clever players noticed the change. Word got out. And suddenly, even
though nothing had yet been done on the live server, prices for Zydrine spiked
dramatically. Markets make for great predictors of future events!

\----

[http://blogs.wsj.com/economics/2010/06/21/real-economist-
tak...](http://blogs.wsj.com/economics/2010/06/21/real-economist-takes-
lessons-from-virtual-world/)

>>> One of his team’s first big findings is somewhat sensitive. Confirming
decades of gender research by economists, sociologists and anthropologists,
Mr. Turpeinen’s group found that the same biases that have historically
favored men in the real world exist in a virtual economy. Their research
demonstrates that both women subscribers and female avatar characters operated
by male subscribers in EVE are biased toward a slightly lower chance of
success in competition with their male counterparts.

------
katsaroles
A bit of a background: Varoufakis is something of a celebrity in Greece for
being one of the first and the most vocal economists to speak out against the
European strategy for resolving the Greek sovereign debt crisis. His
predictions have proven to be tragically spot on so far, although it remains
to be seen whether his proposal for renegotiating the European bailouts, a
proposal that the left-wing SYRIZA political party (which has about 50% chance
of winning in the Sunday elections and has allegedly asked Varoufakis to be
its economic advisor) has stood behind, is actually a realistic one. He fled
to the US and Valve after the doctoral program in Economics he had built in
the University of Athens was dismantled during the crisis and after he started
receiving death threats by people who weren't particularly thrilled with his
opinions.

~~~
msfd
You seem to know a little bit about this gentleman than I (and the rest of HN
probably) know, could you tell us more about his (correct) predictions ?

~~~
antman
I have attended one lecture-seminar-debate for economists. He was a spokesman
and his ideas can be summarized in 2010 here [1].

His work regarding european crisis [2]

[1]:[http://yanisvaroufakis.eu/2010/12/17/the-modest-proposal-
in-...](http://yanisvaroufakis.eu/2010/12/17/the-modest-proposal-
in-600-words/) [2]:<http://yanisvaroufakis.eu/euro-crisis/>

~~~
msfd
A little late, but thanks!

------
steve8918
This is truly fascinating.

I remember hearing about virtual economies where money can be injected at any
time through gold mining, etc, and that they were inherently unstable. Once
you got the gold farming schemes that sold gold on e-bay, it created massive
hyperinflation.

And it totally made sense that hyperinflation would occur since the creation
of virtual gold was limitless and effortless, so the gold farmers didn't care
how much gold they sold it for as long as they got real money. That rendered
the price of gold worthless, and it drove up the prices of virtual goods
across the board.

I would love to see how these problems are tackled in the virtual world.

~~~
tseabrooks
Many games add "Gold sinks" to tackle this. Just ways for players to use gold
that completely removes it from the economy. I believe the trick of this is to
scale it with the amount of gold in the system.

Complete conjecture, but I suspect this is related to things like the
increased price to craft gems in Diablo II (bigger gems are more expensive)
which was a stark contract to Diablo 2's simple method of "3 small gems make a
big gem".

Diablo 2 felt like it had an economy that happened almost by accident whereas
DiabloIII feels like they put a lot of effort into the economy and trying to
have enough ways to remove gold from the economy.

~~~
intended
Adding to gold sinks -

WoW I think had some of the most visible impacts in terms of gold sinks (some
I am sure were pioneered by other games and MMOs)

They brought about the concepts of vanity items, which were absurdly expensive
and went from there.

Whats even more interesting is seeing the progression and evolution of these
economies.

Wow 1.0 auction houses and others barely had the concepts of gold sinks, nor
any of the finer tuned economic catches that blizzard introduced by the time
it reached its 3rd expansion - Wrath of the Lich King.

------
DanielBMarkham
Four years ago one of my first startup ideas I pursued was setting up an
arbitrage between virtual economies. I believed then (and still believe) that
it is a huge chunk of the future. Everything that is tangible now will become
software and intangible in the future. That means the virtual economy is set
to eclipse the current one.

I spoke with some somewhat famous startup-type people; several I met on HN.
None of them seemed interested in my pitch (I was looking for a cofounder).
One basically said "I've already got my FU money. This just doesn't excite me
that much."

I'm looking for some cool things to happen in this space over the next decade.
When I was kicking this around we had all sorts of things we wanted to try.
It'll be interesting to see if any of them come to fruition. One of the key
questions in this space is whether it's even possible to manage virtual
economies as this guy wants to do, or it there's always some level of
abstraction that's remains out of reach. My money says the thrill of being
able to finally experiment will be short-lived. Odds are each economy we
create with gaming rules will simply be a small subset of a much larger
informal economy. Cool stuff.

~~~
unimpressive
Interesting. I have some questions. (If you don't mind answering.)

> Everything that is tangible now will become software and intangible in the
> future.

When you say this what exactly do you have in mind? Virtual reality? Living
substances made through bio-hacking?

> or it there's always some level of abstraction that's remains out of reach.

What sort of abstraction do you feel would be prohibitive in this environment?

> That means the virtual economy is set to eclipse the current one.

In what capacity? Like bitcoin, or like for the win[0]?

[0]: <http://en.wikipedia.org/wiki/For_the_win>

Thanks in advance.

~~~
DanielBMarkham
Manufacturing of tangible goods will become a commodity as 3-D printing
becomes mainstream. In addition, many services that were verbally or
physically contracted will be handled completely in virtual reality. Think
home robots cutting hair, or auto-drive cars.

And as you point out, that's not even touching bio-hacking, which is also
converging to digital/created lifeforms.

Call me cynical, but this article struck me as nerd candy. It's a totally-
awesome idea: we finally get to really measure and experiment with economies!
But in my research several years ago I was already uncovering hundreds of
millions of dollars in a virtual goods black-market. People will take a
character of yours and spend all of their time leveling him up and getting
lots of goodies. Then you log in and take over. You pay them through some back
channel. Or you leave an item where somebody else can pick it up, etc. No
matter how you design a virtual world, there are plenty of ways to make
economic transactions outside the walls. The illusion that you somehow have a
god-like view and can see and observe everything of important is just that, an
illusion. But I'm willing to wait a few decades for the economists to figure
that one out :)

The virtual economy will merge along multiple different lines. I don't think
there's any one answer here. There's no reason your WoW character can't be
traded for BitCoin and used as a downpayment on a VR piece of real-estate that
you then later sell at a profit for options on a futures market in some rare
item coming out in a game next year. Thinking in a linear fashion can really
handicap the possible solution sets out there.

------
creamyhorror
Among virtual economies, EVE Online's economy is the real deal. The EVE game
economy is I dare say more developed and complex than nearly any other games'
- it has many kinds of input factors and stages of production, and many of the
production facilities/resources are player-controlled and their fate
determines on political maneuvering, war and sabotage between player
corporations (guilds). The price of most items in EVE (ships, weapons,
components, structures) is determined by the state of production and
speculation in the economy, so CCP has to consider the economic impact of
nearly every single change they make to the game world. (They hired their in-
house economist in 2008 IIRC.)

If any of you folks are interested in reading about a truly fascinating,
active digital economy, you have to read the EVE economic reports and other
investigations of EVE. It's like reading about mining, manufacturing and stock
markets - against a background of eternal war between corporations - in far-
future space.

EVE Quarterly Economic News, by CCP's economist Eyjólfur Guðmundsson (link
courtesy of xb95): <http://cdn1.eveonline.com/community/QEN/QEN_Q3-2010.pdf>

edit: links to additional content ----- <http://pc.gamespy.com/pc/eve-
online/855380p1.html>

>>> EVE Online was developed to have a very dynamic economy from the very
beginning. It was decided that "time" would be treated as a valuable player
resource: for that reason, raw materials were spread all over the galaxy map,
which takes hours to traverse. This created regional pricing. Interestingly,
there were no trade hubs built into the core game design -- players gradually
settled into certain areas and made their own pockets of population where
trade thrived.

>>> Gudmundsson had some fun examples of how intelligent virtual economies can
be. He showed a graph displaying the prices of a mineral in the game known as
Zydrine. Zydrine is hard to find in the EVE universe, but players had
discovered that killing a certain class of drone often leaves behind Zydrine
in the wreckage. This hole in the market led to lots of drone-farming, and
subsequently the price started to drop. Drastically.

The developers decided to tweak the drop rate and this change rolled out onto
the test server, unannounced, and mixed in with all sorts of other tweaks.
Still, clever players noticed the change. Word got out. And suddenly, even
though nothing had yet been done on the live server, prices for Zydrine spiked
dramatically. Markets make for great predictors of future events!

\----

[http://blogs.wsj.com/economics/2010/06/21/real-economist-
tak...](http://blogs.wsj.com/economics/2010/06/21/real-economist-tak..).

>>> One of his team’s first big findings is somewhat sensitive. Confirming
decades of gender research by economists, sociologists and anthropologists,
Mr. Turpeinen’s group found that the same biases that have historically
favored men in the real world exist in a virtual economy. Their research
demonstrates that both women subscribers and female avatar characters operated
by male subscribers in EVE are biased toward a slightly lower chance of
success in competition with their male counterparts.

~~~
taliesinb
Has anyone here _played_ EVE online? I keep hearing about how intricate and
rich it is, but I've never met anyone who played it. Is the complexity
interesting? Or is it 'time-sink' complexity in the vein of Diablo 3 -- as in
rather mindless optima-seeking?

~~~
xb95
I've played off and on since 2003. The corporation I'm part of now has built
an ERP and manages a trillion ISK (which at the legal rate is $35,000 USD in
assets).

We have production facilities -- several of them. We have distribution
facilities. Transportation units (local and long-haul). We have combat pilots
to protect the transportation. And we have the final delivery points where we
actually sell goods -- both retail (on the market) and bulk (contracts to
buyers).

To manage all of this, we have built an ERP system. It tracks our inputs,
outputs, and processes. It makes procurement decisions (build vs. buy) and
submits orders to the various groups of people who actually make things happen
-- the producers, researchers, haulers, marketers, etc. The game is very
manual on that front, but we use an automated system to actually submit very
small, easy to understand orders that people can do in a few minutes usually.
In aggregate, it powers a rather complicated machine.

As an example... let's say somebody places an order for 10 Widgets out in the
edge of space. We live out near the edge -- actually, look at this map:

<http://go-dl1.eve-files.com/media/corp/Verite/influence.png>

That's the sovereignty map. It's updated daily. My alliance is Intrepid
Crossing in the top right in green. That's 0.0 space (null-security aka no
police and lawless -- players own and control everything). Now, let's go
through that example of a user ordering 10 widgets.

* Delivery order is submitted if we have it in stock. If so, someone will deliver it via contract. Done. * If not in stock, start the decision tree for this item. * Do we have this in stock in production/stock facilities? If so, submit a transportation order. When it gets transported, the system detects this and submits a delivery order. * If we don't have it in stock, check the market prices for the goods required to build this item as well as the cost to purchase it from a reseller. * If it's cheaper to buy, we submit an order to our procurement team. (Automatic, still.) Once they procure it, the order goes to transportation and then finally delivery. * If it needs building, we do another process of seeing if we have what we need -- or if we have to buy minerals, blueprints, etc. * If we had to buy things, those orders are submitted to procurement and transportation. * If we have it (or the minerals arrive), the production order is submitted. * When we finally have the good, then transportation and delivery happen.

The entire thing is mostly automatic. We carry out the whims of this machine
and we supply (rather efficiently) a pretty large alliance. It's a really
impressive system.

Yeah, it's a video game. Sort of.

I love it.

And I haven't even touched on the politics, wars, and everything else. It's a
beautiful, wonderful, maddening thing.

~~~
Simucal
I think it would be interesting to build a game like EVE which maps the
management of spaceships and cargo to the management of real world businesses
like a toilet seat manufacturer in Iowa.

While users of the game are creating distribution networks and building custom
ERP solutions they would really be managing businesses (without their direct
knowledge). If you were really successful in the game then you would find
yourself managing the logistics of a much larger real world company.

I guess the challenge would be to create game mechanics that mapped in a way
to real world business constraints that made sense.

~~~
jwoah12
Sounds a lot like Ender's Game to me, except you are tricked into managing a
business instead of wiping out an alien species.

------
sams99
If anyone from valve is listening, would really appreciate it if you added
commenting support to your blog, I am looking forward to this series of
articles, it is a very interesting and unique space.

~~~
juan_juarez
Have you ever read the WoW forums (or any other official game forum)? The
signal to noise ratio is absolute crap. The first few pages would be people
saying "first!" and it goes downhill & off-topic from there. We're talking
about a site with 10M subscribers, all of them focused on a single piece of
official correspondence, wanting their chance to get attention.

It would be absolutely useless & provide zero opportunity for intelligent
dialog. If anyone from Valve is listening and wants to open discussion, they
would do better to interact with 'higher quality' communities directly.

------
dwc
Intensely interesting. I'm looking forward to more blog entries. Though not an
economist, I've always lamented the way econometrics was starved of
opportunities, and the way competing ideas could both thrive with no real hope
of resolution.

------
goombastic
I guess I would be interested in a truly economics oriented game that modeled
nations without it being about wars, raids, guilds, spells etc. Not sure if
something like that exists though.

~~~
ricree
A Tale in the Desert is probably the closest I know of.

Its player base is limited compared to most MMOs (around 1000-2000ish, last I
looked), but it's a combat free game centered around economic production.

It's also a bit unusual in that it has no in game currency. The last time I
played (a bit more than 5 years ago), it was largely a barter economy.
However, there was a player run item exchange whose credit functioned as a
defacto currency.

I have no idea what the current state of the game is, but if you're curious
about a non-combat economic MMO, it's worth taking a look at.

~~~
saraid216
That's a good description of the current state of the game.

------
dkarl
_an economy where we do not need statistics since we have all the data!_

I simultaneously feel his elation and am mystified. If you have such a
quantity of data that you must relate to it via statistics, how is that better
than only having the statistics? Is it because you can define and calculate
your own creative statistics, or...?

~~~
creamyhorror
Off the top of my head: you no longer need to sample to obtain your
statistics, and you can obtain _good_ statistics on virtually everything and
every sub-component of the economy, _sliced every which way, as many times as
you like_ \-- which is much harder in the real world. You can't just go out
and gather information on sales of all red, oblong widgets in shops owned by
couples aged 50-60 with one dog and one cat -- but you can in a game economy.

Basically it's a huge data laboratory where you are able to record every
transaction in the world, and work from there. That's massively useful to
economists, because they can now test a far wider range of hypotheses and,
furthermore, eliminate them much more quickly.

~~~
yk
Even the real data should contain noise, compared to a true hypothesis. For
example, you could predict that a certain (for the purpose of the example,
small) percentage of all players will buy a certain ship. But many of them
just stop playing by chance, then your prediction fails even if the underlying
theory is correct. [1] I believe the main advantage is, that you can get rid
of sampling bias. So you can look at the entire economy, not only on the part
which is willing to answer a poll. For a nice real world example see [2].

[1] <https://en.wikipedia.org/wiki/False_negatives#Type_I_error>

[2] [http://neuroanthropology.net/2010/07/10/we-agree-its-
weird-b...](http://neuroanthropology.net/2010/07/10/we-agree-its-weird-but-is-
it-weird-enough/)

~~~
lotharbot
> _"But many of them just stop playing by chance"_

I suspect this will be one of the significant weaknesses in trying to
translate anything learned in a game economy into real economies. You have
much better data in a game economy, but people do grow bored or decide they're
just not good enough, and move on. Or people decide they've taken a stupid
path and reset their account, and build from scratch. In real life, most
people try to keep living even if they're at the bottom end of the economy and
don't have the means to change that. This strikes me as a fundamental
difference between the virtual and the real.

~~~
yk
Great, I learn by being misunderstood :) I did think about people who stop
playing because of outside events, like a new season of "Game of thrones" or a
girl, not about ingame events.

However, there is of course a fundamental bias in game economies. Another
example would be, that in game economies people use unethical tactics, like
simply killing competition. ( I did not hear of Bing-hordes raiding the Google
HQ.)

------
petitmiam
Fascinating read, just like many of the other Valve blogs.

Though, I do wish this guy could explain why real-world money Steam games in
the US are often half the price of those in Australia/Europe.

~~~
objclxt
Advertised prices in $ exclude sales tax, because for most states it isn't
levied on digital downloads.

However, VAT in EU countries (don't know about Australia) is included in the
price. This causes a fairly substantial discrepancy, as VAT can be rather high
(in the UK, 20%). Other discrepancies can usually be put down to exchange rate
fluctuations, which with the recent financial issues in Europe have been
somewhat unstable.

~~~
neotek
Regarding Australia, our GST is a flat 10%, and the AUD is near parity with
the USD (and has been above parity for most of the last 12 months). The price
discrepancy is far greater than it should be if those were the only factors.

The Australian Competition and Consumer Commission, an independant regulatory
body in Australia that oversees the Trade Practices Act (among other things),
is in the process of inquiring into the so-called "Australia Tax" to find out
why companies like Apple and Valve charge far more for software sold in
Australia than in other countries despite the low true cost difference.

~~~
inopinatus
The ACCC is pissing in the wind. It's just a matter of geographic price
segmentation to maximise revenue. End of story.

Also, end of legal challenge:

* there's no violation of free trade agreements, which are about governments dropping barriers like tariffs and quotas and confer neither rights to individuals nor obligations on businesses, and

* there's no violation of individual rights, because country-of-residence is not a protected class, unlike gender/orientation/skin colour/race/disability.

------
stretchwithme
An economist finally admits it why they fail so much.

"let’s face it: Econometrics is a travesty! While its heavy reliance on
statistics often confuses us into believing that it is a form of applied
statistics, in reality it resembles computerized astrology"

"the reason for this unavoidable failure? None other than our inability to run
experiments on a macroeconomy"

The theories are never tested. They just get implemented. A thousand other
things are happening at the same time and its impossible to get anything
approaching the clarity of a double blind experiment. But the adherents act as
if they've got exactly that.

~~~
tatsuke95
> _"An economist finally admits it why they fail so much."_

What do you mean by "so much"? Because they can't accurately, regularly
predict the future?

I think you'll find that, in reality, economists know their fallibility and
limitations. It's the proletariat that doesn't understand the under-pinnings
and assume economists should be 100% accurate when they make predictions, and
are upset when they are not.

~~~
stretchwithme
We're not in the current crisis because the people expect 100% accuracy from
economists. Its that economists have bad theories.

Most economists fail to offer theories that accurately describe reality.
Keynesian is the current disaster.

And politicians can only pick from the available theories and tend to pick the
most shortsighted of policies, as they are trying to get re-elected.

Its not that a bunch of unforeseen events have occurred. Its that theories
being followed are bad. They ignore many very real things. And the
consequences that most economists have been denying all along are happening.

For example, they analyze the multiplier effect government spending but ignore
the effects of removing those resources from other parts of the economy. They
don't analyze what happens where the resources are being taken away. But those
resources are real things that people no longer have and cannot use.

------
sp332
Which two economies were being merged?

~~~
lwat
I'm guessing TF2 and Dota 2?

------
frinxor
Looking forward to these posts. I've remember being completely fascinated by
Diablo 2's virtual economy, and saddened that I could find so little articles
about it.

~~~
CosmicShadow
I went to GDC this year and saw a talk by a PHD Economist who does work on
video game economies and releases reports about them. It was one of the
coolest talks I attended, and I spoke with him afterwards. In his talk he
mentioned Habbo Hotel a lot and spoke about a few other economies and how they
came to settle on some sort of currency. I just had to bring up how I first
noticed a form of virtual currency in Diablo 2 as he didn't seem to mention
it. I do recall that SOJ's were like the defacto unit of pricing other items.
Apparently he had actually never heard about that, which surprised me greatly
(perhaps because Diablo 2 was so huge, and because it was one of the only
examples I personally had). Here's hoping he looks into it and writes a report
about it!

------
Tichy
What games does Valve have that have virtual economies?

~~~
tvorryn
Team Fortress 2 and DOTA 2 are the ones I know of.

<http://en.wikipedia.org/wiki/Team_Fortress_2#Free-to-play>

<http://en.wikipedia.org/wiki/Dota_2#Free-to-play>

~~~
chmike
One can exchange items, but not sell them. There is no money account in TF2.
So I don't see any relation with a real life economy.

------
neilk
Complete tangent, but I noticed that on Yanis Varoufakis' blog, the current
entry is his interview with Max Keiser.

[http://yanisvaroufakis.eu/2012/06/15/ponzi-austerity-
intervi...](http://yanisvaroufakis.eu/2012/06/15/ponzi-austerity-interviewed-
on-the-keiser-report/)

What's the connection? Max Keiser sounds exactly like the defective turrets
from _Portal 2_. Coincidence?!

------
wglb
An interesting resonance with Charls Stross's Halting State.

------
Joss451
For the sake of Pete, someone remove the parens from this man's keyboard.

------
pilsetnieks
Reminds me of Neal Stephenson's Reamde and the T'Rain geology

------
lhnn
>the notion that a computer game company has surreptitiously and quite
spontaneously created virtual economies that it comprehends as ‘economies’
(which deserve study and regulation) was enough to write back instantly

Does this man believe we should have legal regulation of game economies? Oh
wow.

~~~
swombat
Do you believe we shouldn't?

Assume an economy can be sized... so it's a $100m economy, or a trillion-$
economy, etc.

Connecting economies together obviously causes them to impact each other. So
long as games are connected just to the US economy, and it is much, much
larger than any game economy, the impact on the "real" economy is nil.

What about a much smaller real economy? Connect an economy the size of Eve or
WoW to one the size of Zimbabwe. Suddenly, events in the game can have very
real macro-economic effects on the "real economy". For example, uncontrolled
creation of "wealth tokens" can lead to inflation, and contaminate the real
world just in the same way as currency fluctuations impact the real world.

Banks can create money, and they are regulated. If virtual economies can
create money on a scale large enough to disrupt the real economy, shouldn't
they be regulated too?

I'm not saying the answer is obviously one way or the other, but to dismiss
the question with an "Oh wow" seems very short-sighted.

~~~
nemo1618
That's a good point. I hadn't really thought about virtual economies like WoW
or Eve as similar to the Fed in that they can essentially print money.

~~~
saraid216
Only for their given domain. Blizzard and CCP are free to make as much gold
and ISK as they want (and they do; it's a faucet-drain economy, and the faucet
does not get shut off). But the quantity and buying power of said currencies
change its value in relation to real world money.

So saying they can print money is not really true; they can control the value
of a particular good that isn't intended to be a good.

~~~
swombat
But if their virtual economy is stabler than a real world economy, this
changes, right? I'd rather own ISK than Zimbabwean dollars. Even if it's not
strictly stabler, the ISK reflect a certain amount of wealth that's retained
in the virtual economy.

Taking another contrived example to make the point obvious, if Eve players
basically controlled the equivalent of a trillion dollars, and they all
decided to shift half of it to dollars (e.g. Because CCP has decided to print
more ISKs), this would have a very real impact on the real economy.

Those are all contrived examples, so regulation shouldn't be based on them,
but they show the question is worth considering.

------
nmutua
i think the gaming sector with its virtual economies is a very good
representive for "real" economies. in both economies it's all about feeling,
very irrational. many panics and hypes. it's a bold move by valve to hire an
economist-in-residence. they are going for the big shot

------
mrose
Maybe it's getting late, but I think i could really use an upvoted tdlr for
this...

~~~
bmelton
This isn't Reddit, and that sort of behavior here is actively discouraged.

~~~
mrose
My comment was sincere and I stand by it. The article was quite long and I've
often seen similar summary comments for such articles here on HN. I think for
really in depth articles it helps to have a good overview before commiting
time and diving in (something more than an obscure title and the valve.com
domain). In this case, I was initially under the impression that it was part
of an ARG, a topic I am very interested in.

I should also note that I don't see anything in the guidelines about asking
for a summary.

~~~
bmelton
I don't disbelieve your sincerity, but was simply stating that we discourage
the notion of of "TL;DR" here, as a community, whether or not it's in the
guidelines.

It's also not in the guidelines (as far as I can tell by skimming) that your
comments should further the conversation, but that is another ideal to which
the community at large has agreed to aspire. We collude to keep comments on
topic and interesting, because that's what the community wants and needs.

I wasn't casting judgement on your post but, as I noticed you were new,
thought I'd offer it as advice.

On a personal note, especially with articles like this, if you are interested
in the topic at hand, read the article. There really isn't any good
substitute.

------
zackbelow
This is awesome.

