Wednesday, March 10, 2010

Not a solution to RMT

Rohan from Blessing of Kings posted a reaction to a proposal that Blizzard should start selling gold to ruin third-party gold sellers, and thinks that this would be okay, if the money went to charity. Through the charity solution he wants to avoid Blizzard having incentives to tune the game that it can only be played smoothly when buying gold. Interesting thought, but I think Rohan missed a far more serious problem of Blizzard starting to sell gold: Blizzard would produce the gold out of nothing, while third party gold sellers only circulate gold around in the economy.

Gold farmers, in spite of their name, do not farm gold. They farm herbs, orbs, or various items dropped from monsters and sell those to players for gold, then sell back that gold to other players for real money. In macroeconomic terms gold farmers do not increase the overall supply of gold. This is why since the release of Wrath of the Lich King most prices for items on the auction house have either kept stable, or slowly decreased with more of those items becoming available. Remember Crusader Orbs for 1,000 gold? Well, they are 100 gold now.

If Blizzard would sell gold, that gold would be "freshly minted", created out of nothing by a keystroke. If enough players buy that sort of gold, overall money supply goes up, causing inflation. The price for a stack of herbs or ore or eternals would go up significantly. That is not only bad for people who want to buy things from the auction house and didn't buy gold. It also is counterproductive to the goal of eliminating third party gold sellers. Because as prices for herbs and ores go up, gold farmers can stay in business, because now with the same amount of work they make more gold, and can undercut Blizzard's official prices. And the more gold players have, the more profitable it becomes to hack their accounts and steal their gold. Of course then Blizzard could undercut them again, because it doesn't cost Blizzard anything to create gold, but that obviously leads to an undercutting death spiral in which the economy is flooded with cheap gold and inflation is rampant.

So, charity or not, Blizzard selling gold would not work to eliminate third party gold sellers, and would only cause harm to the virtual economy. Furthermore we would lose the argument that buying gold is bad because it is cheating, and not allowed by the rules of the game. A rule of "you can only buy gold from us" is morally a lot weaker than a rule of "you can't buy gold".

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