In the virtual world of Second Life, my dancing at a gay bar bought my (virtual) wife the most expensive clothing in that world. Needless to say, I started out with nothing — virtual economies start you out with nothing — and ended with enough to retire me and my wife (virtual) for the rest of our pixel lives.
In real-world economy, however, I would have to slog my entire life to set up a retirement fund for the Philippines (discounting wife), because my wages would be tied to experience, typically rising with age — only. Compare that with a 12-year-old driving a sports car in a virtual game, and the road to real-world riches looks much more complex.
Virtual economies match talent and rewards better. No one envies people getting wealthy in a game; every player admires their riches accumulated through competence and fair means. Also, virtual worlds don’t tax players for creating wealth or punish them with regulation seen in real world: market watchdog, anti-monopoly body, others.
Take Eve Online, a science-fiction galaxy where groups of players called corporations make merciless war on one another for economic gain. Anyone not part of a corp is dead meat. There are no laws, no taxes, no watchdog to check monopolies, cartels, hoarders. It may take several hours to sail across the galaxy, and in doing so, your ship may get blown up by other players. The basic resource for building a ship is ore, which is also your gateway to riches. So, get a small mining ship, sneak to asteroids, mine them for ore, and put the resource up for sale at a space station. Or drive around in a large cargo vessel as an interstellar salesman, taking advantage of price gaps between planets. You only have to dodge pirates.
When being a salesman trucker becomes boring, you can transform into a full-fledged trader, scan prices in planetary systems where the sell price for an item significantly exceeds its buy price, and place a buy order just above the current buy price; some player will take the order and give you the item, which you can now sell just below the current sell price. If another player accepts your sell order, you will pocket a profit (a bit less than the gap between original buy and sell prices).
These economic opportunities exist because most players focus on murdering each other, not trade. Thus a dumbass pirate pulling into a dock with loot sees only one price, the buy price of a single trader. He can sell his stash, or go to different planets for better prices and risk getting blown up by another badass pirate. So he simply dumps his loot and takes the virtual money. Similarly, a pirate looking to buy guns may pay the local price or go inter-planetary shopping, putting himself at risk of being blown. So he simply pays up and heads back to battle.
By contrast, traders get to see prices in many planetary systems, because they have purchased the game rights to do so. Also, traders and all other players could hold wealth in the game’s virtual money, ISK, turning it into real money as necessary, or use ISK to convert dirty money. For example, you blackmail a beautiful murderous heiress (think Paris Hilton) and now have $20 million in black cash from her. The serial numbers on the banknotes are known to be from her account. What if she goes to the cops? Very well, use the banknotes to buy $20 million worth of ISK, then sell the virtual money to Eve users for $20 million. At the end, you have clean money, you are a millionaire, and the police cannot connect your notes to the heiress.
Even if you envy such crooked millionaires in Eve, please know that the virtual rich club is ever-changing and always open for new members as existing ones get destroyed in inter-stellar battles that wipe starships, outposts, and mines worth up to half a million dollars in one go. The CEO of one of the largest corps in Eve, for example, was murdered after 10 months of deception; spies looted the company’s hangars and vaults and the cost of the theft totalled more than 30 billion ISK, much more than the one-billion-ISK bounty on CEO’s head. The billionaire club in Moscow, by contrast, is walled off from competition, trouble, and new entrants. To stay in style, all oil oligarchs have to do is cling to Russian President Vladimir Putin, and pray he doesn’t fling them to a labour camp in Siberia.
For all these reasons, virtual economies are far better for wealth creation and happiness than real economy, where too many of us start poor and face a real-life game too frustrating to seem worth it, hence we wind up on drugs. Even if real-life game has been beaten by dad and you are already rich, you get bored and you quit (suicide, drugs). But in most virtual economies, everyone starts with nothing, and quits with a diamond-studded jet.
ashish.sharma@bsmail.in