Do MMO Economies need a Greenspan of their own?

In every MMO I have played in, there always comes a time when it seems something in the economy shifts decidedly in one direction, usually not for the better of the average/casual player. Now admittedly these economies are flawed in some way from the start, usually in the sense that there is an unlimited amount of money in the world, and the input will always be greater than the output (Read as: Players always earn substantially more in the long run than they give back to the NPC’s/Vendors/Cash Sinks in the game). Often times this leads to a series of inflation jumps, where an item that previously cost 50 silver is now 1 gold 50 silver, then 3 gold, then 3 gold 50 silver, etc etc.

There could be many reasons for these price changes, and some of them are quite normal and reasonable to expect as the server’s economy progresses. Some of it is where the resources/items are located; as the server age/level increases, the more common resources are less likely to be gathered by the vast majority of the population. Someone who is level 70 and needs copper in WoW isn’t likely to go back to one of the newbie zones to mine their own. Thus the higher level players are willing to pay a premium for the convenience of not having to go farm it themselves. They’re too busy prepping for raids or farming the high level hard to find materials. Over time this does create an imbalance, as the players who play constantly are creating far more gold than those who are not, either through dungeon runs, grinding or doing raid content. Once you can farm a raid zone, you can easily make 60-80g in a couple of hours. But for those who can’t raid or don’t have the time, they are falling behind exponentially as the cash flow steadily increases in the hardcore player’s favor.

However, these companies do have the option of “adjusting for inflation” with their currencies. The only ones who determine the value of their currencies are them.  They don’t answer to the World Bank like a normal economy has to.  If they change it, the only ones affected are those who are playing the game.  And they have every right to adjust it, as they own all of that currency anyways.  Here’s a relatively simple way to level the playing field: If you take for example the concept of CPI, or Consumer Price Index,  which is defined as “an inflationary indicator that measures the change in the cost of a fixed basket of products and services, including housing, electricity, food, and transportation, that is published monthly.” (also called cost-of-living index).   With some slight modifications, this tracking system could easily be applied to MMO’s.

MMO companies have metrics that track practically everything under the sun, so it would not be very hard at all to come up with their own version of a CPI (Consumer Price Index) and adjust accordingly. Let’s just say for example that in a MMO’s CPI, they track something like… 60 items regularly found in game. They can be reagents, they can be consumables, they can be pretty much anything whose price is dependant on market activities. Obviously in most MMO’s housing, transportation and utilities will not factor in, so they would be removed. So let’s say that between the months of October and November, the CPI went from our base of 100 to 106. That means what cost 100 monetary units to purchase in October now costs 106 of those same units. In effect, the economy is going through an inflationary period; your money can’t buy what it used to. Now for those who have tons of cash in reserve, they can absorb those changes without blinking an eye… but what about the casual player who doesn’t have the time to grind out cash to keep up with the economy? Are they just to be left behind, griping with the market prices and left feeling like they’re being shafted for the benefit of the hardcore players? Or can we take some simple steps to fix the balance and level the playing field?

So with that metric in mind, it would be relatively easy for the company to either add or remove currency in order to keep the playing field level. Or if you want to take it another step further, the company can also track what the median currency amount the average player holds, and adjust that for inflation instead. So if the average player has 250 of your game’s currency, and those above that median have an average of say 400 currency, all they have to do is apply a global monetary increase/decrease to bring the economy back into balance.  While I’m sure that this would annoy a lot of players (WTF? Why j00 taking my l00tz0rz?!?!), in the long run they’ll have to understand the reality:  It’s not “your loot”,  It’s the company’s.  By paying your monthly sub, you’re paying for the privelege of playing their game and “collecting stuff” for “your character”, which you don’t truly own.  Get over it.  If they’re going to pull back some of “your monies” to help the economy, that’s a good thing.  It means your cash is worth more now, so you’re more on par with the fat cats.

I now open the floor to your comments/suggestions…. after I finish lighting my candles with my $100.00 bill I just lit on fire to use as a match.


~ by trollonfire on November 1, 2007.

2 Responses to “Do MMO Economies need a Greenspan of their own?”

  1. An interesting subject and a novel idea to fix it. But I think the proposed solution is fatally flawed. All that would result is that the “smart” players shift from holding their $$ in gold to instead holding commodities like Primals in WoW which are being inflated. And even then, the target problem (casual players being outearned by hardcore players) isn’t being fixed. Hardcore players will still outearn casual players.

    I think the bottom line is that, in general, players are earning an hourly wage. If Y hours are played, and Z gold is earned, then in general, most MMO’s would result in 2Y hours earning 2Z gold (maybe a little less). And since the hardcore player plays 2-5x as many hours as the casual, they will of course make a lot more $$.

    A smart casual player can still make up some ground by doing more cost effective & time efficient methods of making $$. Transmutes and basically anything on a timer like Tailor cloths in WoW are good examples of how casuals can make up for less play time. Also, some $$ sinks such as raiding will cost the hardcore players much more than a casual player who raids once/week.

    Inflation for items in the Auction House cuts both ways. Sure, the casual player needs more gold to bid on items, but now those items will be sold for more $$, too. The real underlying currency is time. Inflation hurts those with a lot of current $$, in that it won’t buy as much. But future acquired items & goods can now be sold at higher $$, and therefore inflation actually helps. This isn’t like a job where you earn a fixed wage and are paid with a deflating currency. Instead you’re earning items & goods that can and will be inflated.

  2. […] Let me give you a quick example of why inflation does not help a new player. Mike starts playing the day WotLK hits the shelves. He chooses to roll a mage because he has always wanted to cast spells and be a wizard. He makes it to lv10 and starts wondering if he can get any nice gear on the AH. He goes there only to find that all green lv10 pieces cost 2-4 gold. He also wants to be an alchemist. He needs some peacebloom and silverleaf, to be specific. Unfortunately, they also cost quite a bit. Mike can keep playing. But he will feel alienated. If you wish to explore the subject a little more, i suggest reading this article: Do MMO Economies need a Greenspan of their own? Troll On Fire – MMO’s, Flames, & Discussion […]

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