Economic theories and interventions should be tested. Testing them proves to be difficult, since it’s hard and ethically problematic to make controlled trials. That’s why economists so far have resorted to mathematical models, analysis of historical data, or examination of currently existing systems. With contemporary information technologies mathematical models can be simulated in great detail. Big data and big analytics allow a more detailed and comprehensive economic analysis. Finally, the internet recently enabled the creation of MMOs like World of Warcraft, Eve Online and virtual worlds such as Second Life, which are complex enough to have their own (virtual) economies. Examining the economies of these MMOs in detail could probably reveal interesting insight. However, there is an even more promising approach that could be taken: Integrating such MMOs with specific economic systems in order to test their behaviour.
The MMO as economics lab
The basic idea is simple: The MMO serves a simultaneous dual role as “regular” game and as economic simulation with real human participants. Economic experiments can be made within the MMO setting via defining and intervening into the in-game economy of the MMO. For example, different taxation schemes, virtual currencies, basic incomes, and reputation systems could be tested in an appropriate MMO. It wouldn’t be hard to collect all salient data from such a game – at least much easier than getting similar data from the “real world” economy.
Requirements for “lab MMOs”
A crucial requirement for such MMOs to be used as labs is that the developers of that game agree as testing platform for economic theories, systems, and interventions. At the same time, the user base needs to be large enough to generate statistically significant data. Both of these requirements may be mutually conflicting, since games that are set up to act as scientific experiments may not be the most fun games to play. However, it may be the case that the experimental character of these games may attract particular target audiences, or may even make such games more attracting to the general audience.
Obviously any “lab MMO” should enable economic activities within its own world. A system that allows for trade of in-game objects would be a modest basis for an in-world economy. Internal virtual currencies, or even taxation schemes would add the necessary complexity that allowed the MMO to be used for sophisticated economic questions. Additional systems like reputation systems could be used to simulate possible reputation economies.
The ideal lab MMO
Ideally, one would want to be able to compare various parameters of different economic system simultaneously by letting them compete with one another in the same MMO. It would be very enlightening, if the MMO was big enough to enable the creation of large virtual states, each with its own economic system, which competed with each other for resources, active members, and various in-game scores and achievements.
In order to test novel economic systems a futuristic, or fantastic setting would be preferable to a historical setting. A contemporary setting would also be an interesting option, if most things are the same as in our world, but some parameters are changed.
The higher the complexity of the in-game world and the closer it resembles the possibilities in our current economy, the better. Incorporated companies, stock markets, simulated (or actual) cryptocurrencies, decentralized autonomous companies, and similar entities could create a fascinating playing field – at least for those who dare to deal with that complexity in a game setting.