Virtual Money

In City of Heroes, it’s called influence or prestige. In Aion, it’s called kinah. In the World of Warcraft, it’s called gold. In Second Life, it is called Linden Dollars or just Lindens. In the “real world” we call it money.

There’s a saying “money doesn’t grow on trees”. And it is true, of course. Money is not something you find in nature (unless someone dropped it). Money is a uniquely human invention; bird and bees and dolphins and cats and monkeys do not have this dream, this concept of money. I can think of one exception: our family dog discovered that if she grabbed plastic bottle caps and other things we did not want her to have for safety reasons, she could trade them to us for dog biscuits. She had, in effect developed dog money, a medium of exchange.

In the early history of our species, people or groups gathered and hunted their own food. Edible plants and animals were there for anyone who wanted to invest the time and energy into acquiring them. Primitive clothing and tools, likewise, were commonly made by all individuals. Then we discovered specialization. Some people made better stone knives. Some were better at hunting. Some were better at gathering (and later growing) crops.

Early on, the barter system developed, in which people good at making one commodity traded it to others for some of what they could make, so that everyone in theory could have everything they needed, without needing to make everything for themselves. And specialization flourished and led to the creation of better and better tools, clothing, weapons, homes, etc.

At some point, however, we developed the concept of money: arbitrary symbols for goods and services. These counters, of course, these symbols, had to be a finite resource. Seashells might seem like a good idea to use for money, but then anyone could make a short visit to the beach and have as much as they wanted. So the early money became weights of precious metals. At first, there were no coins at all, merely lumps or molded pieces of copper, silver, and gold — the pretty and pretty rare metals. Ooooh, shiny! instead of paying workers in food, you could give them some copper, and they could then trade the copper to a farmer for some food. The farmer then trades the copper for some tools or livestock or seeds. And so on.

At some point we finally realized that we didn’t have to carry actual gold around. We could, instead, carry around colored pieces of paper that, in theory, stood for a standard amount of gold or silver. Now, we don’t even have to carry paper. We carry plastic cards with magnetic strips on them that allow access to bank accounts in which one and zeroes on hard drives stand for amounts of money people “have”.

Back to virtual space. Art imitates life, and so many virtual worlds there is this concept of money. In World of Warcraft, for example, you can gather resources like metal ore, herbs, or cloth, and trade or sell it for in-world currency. I like to use WoW as an example, because it uses the familiar and historic currencies of copper, silver and gold, as I grew up using using pennies and dimes, which originally were made of copper and silver, but nowadays are made of cheaper alloys.

Virtual worlds have virtual economies. Many, like WoW, have auction houses or marketplaces where players can sell resources, food, weapons, armor clothing, and tools to each other to acquire the world’s money, whoch they can then use to buy better weapons or armor etc for themselves. It adds a degree of verisimilitude (realism) to the online gaming. You can acquire skills and make things to sell, and as you become more skilled you can make better things (which require better ingredients) to sell for more money. Rarer things cost more money; common things are cheap. People have have even suggested that these online games/worlds should be used to teach people basic principles of economics like the principle of supply and demand. One fellow whose Warcraft advice I watch related how he had bought up a large number of swords when he learned that WoW was going to change the rules to allow a certain type of player to dual-wield (hold a sword in each hand)….which would greatly increase the demand for swords. He subsequently sold off his inventory of swords for a tidy profit. Buy low, sell high. If the customer does not know where to get your product cheaper (or is too lazy or too impatient to look elsewhere) you can acquire money by selling things for more than you bought them for. Some items, like metal ore or medicinal herbs, are “free” if you spend the time gathering them instead of fighting. In that case, the price you sell them for factors in their scarcity and how much you value your time.

A contraversy arises when real and virtual worlds overlap. It’s called gold farming. Some people play the games merely to acquire the virtual currency, which they then sell to other players in exchange for real world money. The common stereotype is that gold farmers are all Chinese, which is of course not true….but many of them are. the fact of the matter is that gold farming will not get you millions of real world dollars…but if you live in a country where food is not expensive, gold farming might earn enough to feed your family, and then some. So many people in, shall we say, economically disadvantaged regions, have bought computers, paid for internet connections, and begun playing games as a job, to support themselves and their families.

Many online games consider this activity to be a violation of their Terms of Service. The idea is that people should have to earn their own game gold, not buy it with a credit card. Well, of course, your friends or guild mates are allowed to share the results of their labors with you…and guild banks are set up to allow members of the guild to deposit and withdraw game gold from these banks. But that’s not the same as gold farming, is it?

And here is where the angry shouting begins. The game owners, who developed these virtual worlds for us to play in (and for us to pay them for the privilege of playing in) feel that they have a right to prohibit gold farming because they feel it interferes with the in-game economy. If I go to a certain website and buy 5,000 WoW gold, for example, then I can afford to pay more for items in the Auction House, outbidding other players, and driving up the prices of things. To the gaming purist, this is unethical and unfair, because it means people who have more money in the real world get to acquire stuff in the virtual world that poorer players might have to work very hard to be able to afford. Want a flying carpet, a flaming sword, or a mighty gun? Just buy the gold with a credit card and scoop up your coveted item when it comes up for auction.

Okay, there is a point there. By mixing real-world and virtual-world economics, we destroy the egalitarian ideal that in the virtual world everyone has to work for what they get. Now it becomes just like the real world, where people born with more money get to have all the best toys and the rest of us have to get by with what we can afford.

But to be fair, let’s consider the opposite viewpoint. If I work hard to earn to earn a lot of game gold without cheating, shouldn’t this virtual money be considered my property, to do with as I choose? To take an example from the real world, if I go to medical school, become a doctor, and work hard to acquire money, are you going to tell me I cannot buy a nice car with it? Of course not. To do so would destroy the incentive to achieve and excel, what some cynically call the greed motive, that drives some people to do what others are not willing or able to do. Maybe it is simplistic, but high-paying professions exist partly because they are high-paying professions.  Money talks, and we all listen.

Back to the gold farming. Is it, in fact, unethical to work hard to earn game gold and then sell it to lazy people for real-world money? Is virtual work somehow less valuable than “real world” work such as knitting or welding or carpentry or farming? If I spent a year making a ornate oriental rug, would you tell me that I am not allowed to sell it because it allows people with money to acquire a rug without sewing one? No? Okay, then if I spent a year building up a character in a virtual world who is a high level character, who has great armor and fighting skills and weapons, are you going to tell me that I do not in fact own that character, and I cannot sell this labor of mine to someone who has money and wants to play a high level character without spending a year making one?

The fact is, these virtual worlds are creating an entirely new medium of crafting. As a species we have developed the arts of pottery, blacksmithing, woodworking, stonecutting, sculpture, painting, and so on, so that people who want to develop the skills can spend their time making rugs, paintings, vases, clothing, tools, etc., which will then exist for the rest of us. Money is our way of compensating artisans for their time spent creating things we want. And virtual worlds have extended this concept. We can now learn how to craft virtual objects such as in-game tools, weapons, armor, buildings and so on. In Second Life some of the biggest sellers are shapes (bodies) skins (that cover the bodies and make them look lifelike), hair (for men as well as ladies) clothing, and buildings such as houses and castles.

Please explain to me the fundamental difference between crafting a sword and crafting a character. Both take time, attention, and energy. Why is it “fair” to sell an imaginary sword, but not an imaginary swordsman? Why is it “fair” to sell real corn I have farmed, but not imaginary gold I have “farmed”? Isn’t it a basic idea in a free marketplace that you can sell whatever people want to buy, if it does not hurt anyone?

Now I am aware that some people cheat. There are programs called “bots” that automate gaming so that you can take a nap while your character gathers stuff to sell. I do not advocate cheating of any kind, anymore than I advocate stealing, fraud, or selling unsafe or dangerous objects or services. If you compete unfairly with your fellow humans, I hope someone catches you and puts a stop to it. But if you create things of value fairly, a large part of me wants to say that you should be allowed to sell them and be compensated for your time.

“Bind not the mouths of the kine that tread the grain.” “The workman is worthy of his hire.” And let’s not forget “an honest day’s wages for an honest day’s work.” Even if it is done in a virtual world, it is still work. And it should be worth something. I do not presume to look down on gold farmers. They are not selling crack, stealing cars, or invading countries. This, of course, is just my opinion. –MRK

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56 Responses to “Virtual Money”

  1. “At this time it appears like BlogEngine is the preferred blogging platform available right now. (from what I’ve read) Is that what you’re using on your blog?”

    Sighs and points to the to TOP of the page, the very TOP, where it says as plain as day:
    This We Give The World. For Free.

    Please! HOW can I make it any clearer? Am I being cryptic? If you do not speak English and it is translating incorrectly or something, tell me. I will make time to improve it. until then I have to get back to work talking to the World. –MRK

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