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Understanding an MMO Economy

Understanding an MMO Economy

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Understanding an MMO Economy

Players tend not to think about an MMO’s economy until it breaks, but designers don’t have that luxury. An MMO economy is one the most fundamental parts of the game, and that doesn’t have a functional economy is usually doomed to failure. Comparing games like World of Warcraft to games like EVE Online, or comparing free to play games to pay to play alternatives reveals that there are a lot of different economic options. Even so, all of these economies do have a few fundamental traits in common that are crucial to understanding how they work.

  • Fountains and Drains

An MMO economy begins when resources enter the game. Those resources include money, crafting materials, and equipment. They enter the game through fountains, which include drops from dead enemies, harvesting materials from the environment, and anything else that converts a player’s time into resources.

Those resources leave the game through drains or sinks. These are any mechanisms that take resources out of circulation instead of passing them on to another player. Fees to repair equipment or travel quickly are the most common drains, and they have the advantage of hitting most players equally with a low, but constant drain. Consumable items are another popular options since players are usually happy to buy them. They can encourage player interaction when players craft them for each other, but they act as a pure drain when they are sold by NPCs. Expensive cosmetic items can also remove money from the economy, but they tend not to sell very often, so they’re rarely sufficient on their own.

Balancing fountains and drains is the most delicate part of building an economy. If there are too few fountains or too many drains, players will always feel poor and have a hard time accumulating resources. If there are too few drains or the fountains are too strong, money and other resources will become essentially worthless and the economy will collapse. Most games find that having the fountains produce slightly more than the drains remove is best for the economy, but the details vary dramatically from one game to the next.

  • Digital Monopolies

Monopolies occur when only one person or group of people can sell a given resource. It’s usually hard to create a monopoly in an MMO, since players can usually create new characters to access unavailable skills and areas, but there are a few instances where they can appear.

The game’s developers can have a monopoly on any item that they want, as long as it is only available from an NPC. This naturally occurs if the item is bound to the buyer as soon as it is purchased. Even if the item is unbound, the market price from a player will almost never exceed the cost of purchasing it from an NPC. The exception to this rule is when the merchant NPC is difficult to access, at which point players who can easily reach it will act as middlemen.

Free to play games that include a premium item store make their money from this type of monopoly. Allowing players to sell items from the store weakens the monopoly, but it does give players an easy way to make money. This is often controversial among the players, and it can have an unpredictable impact on the game’s economy.

Players can develop a monopoly on an item if they are the only ones who know how to get it. This type of monopoly will break as soon as that knowledge spreads, but it can be significant for a short period of time. In games like World of Warcraft, this sort of thing happens when the earliest players learn how to complete a raid or find a resource node after an update. This drives up the value of new items, but those values plummet after more people learn about the new content.

Auction Houses are also a means to create a monopoly. The wealthy player will take advantage of a new contents desired item by purchasing every item listed on the game’s auction house. This creates a stronger desire to purchase the item at any price. The wealthy player holding all the items can then ration them out at higher prices. This is unsustainable in most cases but can be lucrative in the short term.

  • Luxuries and Necessities

Certain items are necessary for characters to progress through the game at a normal rate. If a mission is designed with the intention that characters need to use a specific item to complete it, then those items are a necessity. Similarly, a basic level of equipment is also necessary. If players cannot access these items easily, then the game is likely to fail simply because players can’t complete the content. That is why many developers choose to make that sort of basic equipment available through NPC merchants.

Luxury items are necessary for a functional economy. Players don’t need them, but they can work as status symbols or provide bonus content. They give players something to strive for, and also something to spend money on. Luxury content that is intended as a gold drain usually comes from an NPC merchant, but most of it should come from player crafting or from raids. That puts things of value into the economy, which stimulates trade.

  • Depreciation

Almost everything in an MMO suffers from depreciation. If the game’s fountains produce more resources than the drain eliminate, items will get less valuable over time. Since that ratio of fountains to drains is usually necessary, this depreciation is essentially inevitable. It happens relatively slowly in pay to play games compared to free games because it is harder for them to create new accounts that can generate resources, but it will still happen.

The easiest way to fight it is to keep adding new content. Older items will lose value, but the new ones will give players goals. The older, cheaper equipment will be accessible to new players, so they’ll have a relatively easy time catching up to the experienced ones.

Temporary drains can also help with extreme cases. People are a lot more likely to spend their money on something that is only available for a little while, so these can take a big chunk of money out of the system at once. They won’t work in the long term, but they’re an option for correcting temporary imbalances.

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