Preface

This book is about an online game, but it’s not just for people who play games. It is written for everyone who is curious (or anxious!) about economics, and anyone who enjoys a fantasy novel should be able to appreciate some part of the story. Parts of this book can also benefit game or simulation designers, policy creators, and business strategists.1

We are not taking a comprehensive look at every economic concept. This is only an introduction to a way of thinking that spends more time on the ideas than on the numbers. The full story contains more drama than I could include in an educational version, and the data that I found could cover many more pages, but it has enough to show that economics can be fun when applied in the right places.

Each chapter of this book has two parts: the story and the economics. And there are many ways to read it. Anyone who considers economics to be boring should start with Appendix A. This will spoil most of the story, but it should make the rest of the book sound more interesting. (Students who are reluctant to read this book should also know that getting better at economics can help you get better at video games.) Educators who are considering this book for their classes should start with Appendix B. This appendix is an outline of the concepts this book will cover. It is also a source of ideas on how each chapter can facilitate a meaningful introduction to economic thinking. Table 1 summarizes the primary economic theme for each chapter (there are many secondary themes):

Table 1 Economic theme by chapter

For anyone who has enough time and interest, the easiest and most entertaining way to read this book is to read it twice. Start by reading the story on its own and skipping the economics. When you can follow the story as an action and a reaction, read the story again with the economics included (or skim the story and focus on the economics). The context of a story makes the economics easier to understand, and reading the story first will make the economics easier to remember.

This book is built on research that came from 3 years of living inside an online game and more than 10 years of reviewing what I saw. It’s a story based in a medieval fantasy-themed online game world named Eternal Lands, but it’s a true story about real people who make real choices. The questions that interested me while I lived inside this game were all about connecting the real world to the game world. What I found, through an informal experiment that started as a misunderstanding, was that economic rules are universal. The economy inside an online game can be described using the same economic models that explain the real world. But the most powerful insight was that I saw how these rules shaped the behavior of players within the game before I ever fully understood the economics. This led to my belief, backed by my own experience, that the right game can be a useful tool for introducing the economics that explain how the world works.

I did not always consider my experience to be noteworthy. I played the game in high school, but the first time I shared the whole story in the real world was at a Christmas party in 2007 during my sophomore year of college. It was a way for me to explain why I chose to study economics. I never intended to write any of it down, and I hadn’t even planned to keep any records of it. It was such an afterthought that I had destroyed most of my data only a month earlier. I never expected that my informal experiment could ever be as useful as real-world economic research. It was only valuable to me as a way to make economics easier to understand, and I did not see how it could be useful for anyone else. But my classmates insisted that I put it on paper.

I spent the next 9 months recovering as much of my data as I could find and reviewing everything I knew about the video game world that you’re about to see—the culture, the markets, and how they shifted over time; my influence and the game creator’s changes; and how a game world can be connected to the real world. The result was an enthusiastically written paper of over 120 pages (single spaced). It was not a masterpiece.

When I finished my writing, I did what I thought any serious writer would do. I found a professor who didn’t know me, and I knocked on his office door. I was a junior in college.

The professor’s initial appraisal can be summarized by the one phrase that he kept repeating: “This is insane!” But, after he read it, he recommended that I make a shorter version as an academic paper. I decided to take his advice.

By the time I became a senior, I cut my manuscript to less than 20 pages. This was short enough to read, but long enough to show the basics behind the economy that I studied, and clear enough to understand that economics is more interesting when it’s put in the form of a story or a game. I titled my paper “The Economics of Video Game Design” and used it as my senior project.

If I had stopped there, I could have called the project a surprising success. But I continued to press the question of whether a study about a video game can be as useful as real-world research. A few weeks after I completed my senior project, I quickly typed out a very simple one-sentence abstract: “This paper describes the economic modeling required to have a viable economy within an online computer game.” Then I submitted it to a conference hosted by the Federal Reserve Bank of Dallas.

The reviews were mixed. My paper did not have as much math as the average economist would include, but the selection committee felt that my project was in the spirit of their goals, and they offered me a place in their schedule.

The time slot that the conference awarded to me was actually the best one that they could offer. It was the only presentation that came in the hour before lunch, a rare position that made my topic a central theme. My research, based on a story that I almost threw away, from data that I almost erased, was considered just as valuable as heavy economic research. It was beyond unexpected. My presentation was so well-received that it led to an offer that I could not refuse—a “full ride” for a master’s degree in economics.2

Over the past decade, I’ve made more than a dozen major revisions to this text. Most of this work has been on my own, with occasional comments from readers, but I have to thank my first editor, Elisabeth Chretien, for posing some hard questions. I am also grateful for the encouragement and insightful comments from Professor Dan Kuester, ­Director of Undergraduate Studies in Economics at K-State, and Professor Ken Brown, Economics Department Head at Missouri State. And thanks to Phil Romero, at Business Expert Press, for providing the support I needed to get this project published. And, of course, I’ll never forget the anonymous professor who agreed to read my first draft.

There were also people involved with the story who were essential to the development of my experiments within Eternal Lands. I will use their names as they are known within the game: The first is my brother, robo2917, who convinced me to be his RICH cofounder. Among the other significant contributors, including hundreds of RICH members, are seanodonnell, gadai, trollson, Lunksnark, SiKiK, jhunLEMON, ­JimmyTheSaint, Protolif, SplargaMan, and Eon_Schmidt. They are not all mentioned in this version of the story, but they were all valuable advisors who influenced the strategies that I used. Many of them are still good friends, but I must apologize for anyone I cannot remember.

The story would not exist without the players who assisted with my plans, but it could not have been reconstructed without the players who made heroic efforts to preserve the game’s culture. Entropy deserves credit for creating the game and keeping it active long enough for me to extract the information I needed, but I owe just as much to the players who were speaking in the moment, sharing how they felt at the time, even when they were my rivals. A large part of the story can be restored by this public record alone, and it’s almost as good as reading from a private diary.3 The players with a more neutral analysis, who faithfully recorded the game’s economic shifts and market history, were exceptionally valuable for this project, particularly bkc56 and trollson’s commentaries on the economy, Torg’s market price list, flinto’s cost calculation spreadsheet, and SiKiK’s bot price spreadsheet (a file that took me 8 years to find and recover). Where possible, I verified or adjusted for the prices and conditions that were in effect at each point in the story. It was enormously difficult to secure accurate and consistent data for such a small game with a decaying Internet history, but I saved the most important features of the story that I was able to find.

The focus of this project has evolved over time, and more reflection has led to a more sympathetic tone. It has also led to the realization that it’s impossible to repeat the conditions and the outcome that I experienced within this story, because my character of Mr.Mind is the only player in any online game who became this influential without directly joining a development team. But there is one thing that has not changed. Every step, from the beginning of the game to the end of this book, started with one major motivation: “Why not try something new, just to see what happens?” I would call it an excuse to continue. Sometimes passion is mistaken for insanity.

1It also includes ideas that may be helpful for developing an investment philosophy, but nothing in this book should be considered investment advice.

2I was the first Kansas State student to attend this conference. Thanks to this start, and the support of the Economics Department, K-State has sent more than 50 students to the Dallas Fed ESP.

3Many of these players are quoted throughout this book. In some cases, I have made minor spelling corrections and/or minor grammar fixes while preserving the context and voice of the original quote. Where misspellings and grammar choices appeared intentional, I left them as they were. Special thanks to Entropy for providing permission to use quotes from the message board.