A video game economy the size of a small country.

AuthorFeeney, Matthew

Last year EVE Online, the massive multiplayer online game set in the fictional universe of New Eden, welcomed its 500,000th subscriber. (For comparison, Iceland, the country where EVE Online developer CCP Games is based, has a population of about 320,000.) A video game with a nation-sized economy throws off an awful lot of data, but can economists draw real-world lessons from the buying, selling, stealing, and destroying of virtual space gear?

As in-house economist at CCP, Eyjolfur Guomundsson oversees all of New Eden's trucking and bartering. As Guomundsson told the blog Massively in 2009, New Eden's economy behaves very well according to economic theories seen in the non-virtual world. "I have not found any example of an economic theory that does not apply to a virtual economy like EVE," he said. "And in all honesty, it looks to me that it even applies better than to the real world because there is less distortion in the EVE universe than there is in real life." Still, it would be unwise to think that New Eden's economy provides easy lessons for real-world policy makers.

For starters, EVE Online players are not demographically representative of a nation. The culture of New Eden appeals to a fairly specific sort of player, observes Dmitri Williams of the University of Southern California's Annenberg School for Communication and Journalism. "Where its players like the lawlessness," Williams says, "it's also famously hard to learn and is not for the faint of heart. Its players are anything but typical and representative of other games. Your Candy Crush-playing masses are not going to be happy (or welcome) in EVE."

Those brave enough to venture into New Eden can expect to reap some of the rewards of a game designed by people who understand the attraction of economic freedom and the value of community. EVE Online is a "sandbox" game where players create content, making it different from many other video games. Observing the emergence of trade there offers interesting insights on how market institutions might take shape against a relatively anarchic legal...

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