Article taken from GramLog. Find Gram Games jobs in London and Istanbul https://www.gamesjobsdirect.com/browse-jobs/gram-games
19 July 2016
Our colleague Can is a data scientist by day and a virtual economist by night. We decided to grab a cup of coffee and talk to Can about his hobby; virtual economies. His enthusiasm exceeded our anticipation so also asked him to provide us with graph that illustrate his train of thought.
First of all, what is a virtual economy?
A virtual economy is no different from a real economy really. Economy is the science of making decisions when resources are limited. The only difference between a “real” economy and virtual economy is that in virtual economies all goods are virtual.
It comes as a joke to most people when they hear that virtual knives in CS:GO cost more than real knives but there is a simple reason for that. People want to buy them and there aren’t that many virtual knives out there. Virtual knives are not really different than diamonds when you think about it. They have no internal value but there is demand for it and the supply is limited.
How did your interest in virtual economies start?
I’m a big fan of Dota. I’ve been playing the game for almost 12 years now and I also love trading in game items. One day I noticed the significant impact of real-life events on item prices in Dota’s virtual economy. One good example to this would be a website that allowing in-game item betting on professional Dota 2 matches starting treasure key betting. Treasure keys used to be the currency in Dota back than. Key prices increased by a large amount that day. There were two reasons for this. One, increased demand to keys. A lot of people loved betting on pro matches and they wanted to acquire more keys to bet. Second, the website purchased a lot of keys from the community marketplace to be able to give out keys to winners, lowering the number of keys available for trade in the market. If you studied basic microeconomics you can see what’s happening here. First effect shifts demand curve to the right and second is a shock on the supply curve, shifting it leftward and leaving us with a higher price level.
When I realised that economic theory can be used to explain the behaviour of virtual markets I had an idea. Why not use virtual markets to better understand real markets? It makes perfect sense when you think about it. You have perfect information and experimentation costs are almost neglige compared to real life experimental economics. These ideas led me do my Master’s in economics 2 years ago.
Are there any titles that uses virtual economies in mobile?
Every decision you make is an economical decision when you think about it. Deciding to updgrade your tower instead of your troops is a decision you have to make. Economics is everywhere. But if you are talking about a mobile game that allows players to trade and craft their own items freely, I don’t have any examples. Who knows? Maybe one day I’ll give a prototype presentation with these core mechanics. You can follow my blog about virtual economies on Game Economics as well.
You can learn more Can in this short video interview: https://www.youtube.com/watch?v=d7CKke5vg9Y