Some time ago Shamus Young wrote an excellent piece explaining why in-game economies in most RPG’s are horribly broken. To make a long story short, it is because every time a player character visits a local dungeon he comes back carrying 15 magical swords, 6 enchanted breastplates and a large sack of gold. Trying to simulate real economy in a world where the PC can basically produce very expensive items out of thin air at will is just not going to work because it would lead to insane price fluctuations. When the original Fable attempted a supply/demand simulation crafty players quickly realized that you can game the system quite easily. You simply walk up to a vendor and buy all the healing potions (for example) he has. Seeing his supply dwindle and huge spike in demand the AI would increase the price at which the vendor was willing to buy the healing potions back from you. So you sell him all of his stock back at a profit, and the price of the item drops again since the vendor now has lots of it in stock so you can purchase it on the cheap again. Do this enough times and you will have more money than you could actually ever use. And the reason why you are able to do this is that you earn most of your money by questing and killing respawning monsters. So no matter how you set up your virtual economy – a questing and grinding PC will eventually always accumulate quantities of wealth that would otherwise be unheard of in the game world.
Shamus mainly looked at single player games but MMO’s suffer from very similar problem. Many of them however found a solution to this issue in the form of money sinks such as mounts or various other prestige/vanity items. But in addition to the static vendor based economy most of these games also have a separate dynamic player driven marketplace – which also tends to be broken. I’m going to use World of Warcraft as an example here because that’s the game I’m most familiar with.
WoW has a crafting system that allows players to gather ingredients and create new items from them. For example a leatherworker uses leather must be gathered from animals by a skinner. A blacksmith uses ore that can be collected by miners… Tailors and engineers can craft items out of various resources that drop out of mobs during questing. Since at any given time a player can only have two professions you would think there would be a vibrant market out there where gatherers sell raw resources to crafters and crafters who sell their wares to everyone else. Conceptually, you would also expect it to work more like a real world market. For example you would expect a leatherworker to be able to go to the market and buy bunch of leather, then use it to make fancy leather armor and sell it with a profit. This is however not how it works.
In WoW auction house raw resources are very, very expensive but the crafted goods you can make out of them are mostly worthless. This is especially true at lower levels where you are much better off trying to sell raw leather than to make it into something – that is if your aim is to make money. However higher level items are also mostly worthless. For example a high level tailor can make a cool flying carpet mount but you have to be a high level tailor to use it. This means that all of his potential buyers are other tailors who can make the same item for themselves. In fact the only way he could hope to sell that item is if he priced it at below the auction house cost of the ingredients that were used to make it. And thus, the economy is broken. Why is that though?
Gathering leather, copper, linen, wool and other common crafting materials is a time consuming process. It essentially forces you to go out there and visit the pick-up spots or grind specific mobs all day. A lot of players don’t want to bother with this tedious chore but they want to level up their crafting profession quickly to be able to make powerful high level items (for themselves or for their buddies – obviously not for sale). They are willing to pay big money for the luxury of not having to do the tedious gathering grind. New players who are just leveling up their first character are happy to pick up the slack and do the grinding for them, selling them raw resources at marked up prices. In fact they can get away with hiking up the prices as high as the market will bear it. But how high is that?
Well, in a game like WoW which has been running for a while it is pretty high. The people who are willing to pay premium for raw resources are usually seasoned players who already have one or two characters that hit their level cap and are rolling in wealth due to the very brokenness of the static RPG economy and escalation of quest rewards that Shamus described in his article. Whenever the decide to pick up a new profession they make a new character and transfer a fraction of that wealth to them to start them off. And so the economy remains broken.
That’s how it works in WoW though. I’m not sure if there are MMO games out there with economies that don’t suck because… Well, I don’t play MMO’s that much. I hear that when Star Wars Galaxies first came out it actually had a working economy that made some sense – or so goes the legend. I have never actually played it, and it was later irreversibly broken so that it could be more Jedi oriented and more like WoW.
Also, I’m pretty sure someone will mention Eve Online on the comments. For the record, I have played it but was very underwhelmed by the gameplay. Basically I found it very boring. Flying in space was boring – you just select a target and go get a cup of coffee while your ships flies there on autopilot. Combat was boring as well. You just select a target, tell your ship to circle around out of the other guys weapons range and go watch TV. I won’t even mention mining which consists of pressing a button every and staring at your ship shining a beam onto an asteroid for a solid minute. I love reading about the crazy hi-jinks that take place in Eve but playing it was putting me to sleep. That said, their trade system seemed to be very complex and well developed and the game itself is a bit different from your average “quest and grind” MMO so chances are they actually made it work. Any Eve players on here who can confirm this?
Do you have other examples of broken MMO economies? Are there other games out there in which the economy works they way it should? Let me know in the comments.