Will Virtual Economies Affect Real-World Economics? 38
Thanks to Game Studies for their Edward Castronova-authored article discussing the economics of massively multiplayer games, which asks the question: "Will these economies grow in importance? Second, if they do grow, how will that affect real-world economies and governments?" It's suggested that "the mere fact that Earth economies may suffer as people spend more time in cyberspace does not imply that humanity is worse off", as "the basket of produced goods is simply changing." Finally, some of the unique economic facets to virtual worlds are pointed out: "Economics, on Earth, argues that no wise government will try to control prices. In an avatar economy, however, the government can effortlessly peg many prices at any value."
"Wise" Being the key word (Score:5, Interesting)
Real, unwise governments institute price controls all of the time with devastating effect. Witness how the US healthcare industry is reacting to price ceilings instituted via insurance and government health programs and how the oil markets reacted to Nixon's attempts to curb inflation in the 1970's.
Meme exchange (Score:3, Interesting)
One positive aspect (Score:5, Interesting)
Has anyone pointed out... (Score:4, Interesting)
Reporting Virtual Earnings to Real Tax Authorities (Score:4, Interesting)
The extent that virtual economies let "players" perform virtual jobs and earn virtual money that can be used to buy valuable products and services is the extent such virtual income is taxable. If enough players earn more money online than they pay in monthly fees, then said players are effectively gainfully employeed and profitable. If the virtual money is exchangable for real money, then it becomes much more likely that the IRS could get interested.
Hmmm... do virtual earnings count as earnings in foreign country?