Are game economies fundamentally different from real economies?

Games are very different one from each other. Maybe there exist some game that is quite similar to real world, but most of the games are of course fundamentally different from real world.

In game economies you do not have Rothschilds, Morgans, Rockefellers and Carnegies controlling everything. The same can't be said with certainty about real economies.

The main difference is the role of the computed land value; virtuality nullifies the accounting function of the earth's resources. In the real economy, land value serves as the fundamental collateral for all banking processes, since Sumer and Babylon. In any case, textbook economics will have to be rewritten, concerning real bargaining processes, virtual gamification and systems entropy.

Thanks for the interesting answers and views so far. What I find insightful:

Interestingly land and ownership of land were mentioned. Fundamental differences arise out of the scarcity in the sense of land and space that is physical rather than virtual (brings to mind the implications of the 2nd law of thermodynamics, entropy law etc)

Physics is still very much part of most games (hence in some cases the "game physics") and by extension, game economies, so perhaps they are not fundamentally different other than the tag "virtual" and "real"- between the two types of economies.

It would seem that for a fundamental difference to exist, the game world would have to be one in which the physical, biological and chemical laws do not apply. Or perhaps a world where its occupants do not have the same nature and propensities as homo sapiens.

On a more social level, the idea of power structures and the extent to which it is affected by (given by design in) the virtual environment is also an issue. A related thread is the idea of economics as a vehicle for the extension and acquisition of power. The design of the game may constraint this evolution of power structures and struggles. The evolution of economic order from such dynamics is an interesting element yet to be explored. What constitutes institutions and their necessities within a game platform for a value-added experience.

There is perhaps different degrees of realities even for the gamer and the game as, the gamer takes the role of a "planner" that expends and utilizes cognitive and affective costs while interacting with the games, and the agents within the game have their own economics to deal with. The goals of the game (the end game) is to bring about an alignment (shall we say, an equilibrium) between the economics of the gamer and the economies of the worlds within the game.

Yes, there is no entropy and power structure in gamified cyberspace. The landlord's game (today monopoly) is a good representation of economic systems agency, for example.

It really feels like you have ni mind some particular game(s). In many games, there is no economy going on, you just keep killing your enemies.

In games, there typically is no social conscience or moral code of conduct either. Risk taking is amplified to a higher level with no consequences. Sacrifice is meaningless and a reset comes with a click or push of a button.

Game economies are more cruel than real economies. That is because : in real economies agents have to satisfy their basic needs, such as their food, clothing, etc. So, they are willing to back off sometimes in order to gain the previοus. In game economies, there is no sensitization, or basic needs, so they tend more to immoral bargaining. Regards,

Christina

this link is useful

https://en.wikipedia.org/wiki/Virtual_economy

regards

For some, the real economy is a game. For others, it is survival and struggle. And for others, it is a test of morality t pass to a higher level.

One question is... is it a zero sum game where a winner creates a loser or a game of maximization ?

We can assume the following: in virtual world are working fundamentally differeсe laws from laws of the world where we live. Thus we can suppose and the availability of resources, sources of existence, of which we do not know. Hence other rules of the game.

Economic processes are manageable within a particular system. The construction of the virtual world as an analogue of ours introduces new data into the system. And, you are right, the gamer when planning uses the resources and models of the world in which we live.

We can assume the following: in virtual world are working fundamentally differeсe laws from laws of the world where we live. Thus we can suppose and the availability of resources, sources of existence, of which we do not know. Hence other rules of the game. Economic processes are manageable within a particular system. The construction of the virtual world as an analogue of ours introduces new data into the system. And, you are right, the gamer when planning uses the resources and models of the world in which we live.

Dear Kateryna,

Thanks for taking time to share your views on the degree of emulation of the real world and where and when that would be feasible or reasonable. I suppose that even the "physics of the game" is not the "physics of reality". More could be said of the level of artificial intelligence that agents in the game are endowed with, compared to what passes for intelligence in the average person.

Regards,

Bernard

There is evidence on this issue from experimental economics and related fields...

Chesney, T., Chuah, S.H., Hoffmann, R., Hui, W. and Larner, J., 2018. Virtual economic experiments. Social Interactions in Virtual Worlds: An Interdisciplinary Perspective. is a survey by a group who have done several experiments in online worlds. Nick Yee as looked at motivation and behaviour in virtual worlds ( Nick Yee Motivations of play in online games

Journal of CyberPsychology and Behaviour, 9 (2007), pp. 772-775)

And with an ex-student I have done experiments which documents evidence of the endowment effect amongst traders of virtual goods in Runescape. Truck, barter and exchange versus the endowment effect: Virtual field experiments in an online game environment, YF De Sousa, A Munro Journal of Economic Psychology 33 (3), 482-493

Depends on the prowess of the game developer.