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Online fantasy games have booming economies and citizens who love their political systems. Are these virtual worlds the best place to study the real one?

by Clive Thompson

Photographs by Gus Powell

Published in the June 2004 issue.  » BUY ISSUE     

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Virtual worlds have produced some surreal rags-to-riches stories. When the online world Second Life launched, the players were impressed to see a female avatar industriously building a sprawling monster home. An in-game neighbour stopped by to say hello only to discover she was a homeless person in British Columbia, logging on using her single remaining possession, a lap-top. Penniless in the real world, she belonged to a social elite in the fake one.

Not all social inequities are absent, of course. For instance, Castronova discovered that women in the game are worth less than men, in a very measurable way: when he compared the sale of male and female avatars, he found than female characters sold for 10 percent less than male ones at precisely the same power level. Players with female avatars also say it’s harder to advance in the game, at least initially—even though the female characters are often being played, in real life, by men. (A study by the game academic Nick Yee found that male players “cross-dress” as female characters at least one-third of the time.) Men play as women characters partly for the kinky thrill, but also because female characters are given random presents of free stuff by other players, a chivalric custom known as “gifting.” “Personally, you receive a lot more stuff when you start out as a female,” as one male cross-dresser wrote to Yee.

Ultimately, Castronova says, EverQuest supports one of Adam Smith’s main points, which is that people actually prefer unequal outcomes. In fact, EverQuest eerily mirrors the state of modern free-market societies: only a small minority of players attain Level 65 power and own castles; most remain quite poor. When game companies offer socialist alternatives, players reject them. “They’ve tried to make games where you can’t amass more property than someone else,” says Castronova, “but everybody hated it. It seems that we definitely do not want everybody to have the same stuff all the time; people find it boring.” It is a result that would warm the heart of a conservative.

Yet progressives, too, have been drawn to Castronova’s research. Robert Shapiro, formerly an undersecretary of commerce for Bill Clinton, views the economist’s findings as nothing less than a liberal call-to-arms. EverQuest players tolerate the massive split between the virtual rich and the poor, Shapiro tells me, only because they know that this is a level playing field. If you work hard enough, you’ll eventually grow wealthy. In Shapiro’s view, Castronova’s research proves that the only way to create a truly free market is to support programs that give everyone a fair chance at success, such as good education and health care. “This may provide the most important lesson of all from the EverQuest experiment,” he wrote in an essay. “Real equality can obviate much of a democratic government’s intervention in a modern economy. . . . If EverQuest is any guide, the liberal dream of genuine equality would usher in the conservative vision of truly limited government.” In other words, maybe the best way to save the real world is to make it more like EverQuest.

A few months ago, a powerful warrior showed up on EverQuest. He was at Level 50, an indication that he was an experienced player. But when he tried to join a group of other similarly powerful players on a quest to kill a dragon, they quickly realized he had no idea what the hell he was doing. He didn’t understand teamwork or even the basic language of the game. Then they discovered his secret: he was a thirteen-year-old kid whose parents had gone to PlayerAuctions.com and bought him the character for $500.

“He kept getting killed over and over and over again. People were like, Who is this idiot?” says Sean Stalzer, a thirty-three-year-old who is a five-year veteran of EverQuest. Stalzer runs The Syndicate, one of the game’s most respected “guilds.” Guilds are groups of powerful characters who co-operate to defeat the deadliest monsters (which provide the richest loot). The most elite guilds generally have a no-buying ethic. They accept only players who have “levelled up” their characters the old-fashioned way. “They put hours and hours into it,” Stalzer says. “So when someone comes along to make a profit or buy a character, it makes a mockery of what they do. Why should you be better than me because you have more money?” His disdain is like that of a hardscrabble kid from the projects who works for years to get into Yale—only to watch George W. Bush sail in because his daddy is a rich donor.

This culture war underscores the big irony of EverQuest politics. Sure, most players love a level playing field—but they love a leg up even more. Adam Smith might smile at EverQuest’s booming marketplace, but beneath the surface Marx’s bleaker vision of capital might be winning the day.
Of course, many people buy “pre-levelled” characters not to cheat at the game, but to save time. They’re usually busy professionals who can’t waste six numbing hours a day killing bunnies to make their warrior elf more powerful. Game companies frown on the selling of characters because they feel it destroys the meritocratic feel of their worlds. But because so many millions of players clearly want to buy their way to power, the companies have mostly turned a blind eye to the online auctions. Last year, Ultima Online caved in and began to sell “pre-levelled” characters to new players; demand was so high on the first day that their phone banks crashed.

Even the most stoic guild members are tempted by the booming market. Stalzer’s guild was once offered $50,000 for all of its characters and loot. The members declined. But, sometimes, when individual guild members run into financial difficulties in the real world, they quietly pawn off virtual goods on the side. “One guy had an ‘Enchanter’ and he sold it for $2,000,” Stalzer tells me. “That happens a lot. You get a guy who says, ‘Dude, I just graduated and I can’t find a job, so I gotta sell this thing.’ But I don’t mind it when it’s real financial need.”

Guild members hesitate to sell their goods in part because they do not feel they are the sole owners. When a guild vanquishes a monster, it divides the loot among the members. Each player’s booty winds up feeling more like a piece of communal property. At the Las Vegas computer conference, Castronova and I ran into a blue-haired nineteen-year-old who plays EverQuest as a Level 55 “cleric” in a powerful guild. “I’ve got dozens of reagents, these magical potions,” she said. “And some of them are probably worth, like, a hundred bucks apiece. I could totally sell them. But I always think, damn, I only have this stuff because of how other people helped me get it. So they sort of own it, too. It’s not my right to sell it.” In EverQuest, even socialism finds a home.

Within months of Ultima Online’s launch, in 1997, the game spiralled into a currency crisis. The developers woke up one morning to discover that the value of their gold currency was plummeting. Why? A handful of sneaky players had discovered a bug in the code that allowed them to artificially duplicate gold pieces (called “duping”). The economy had been hit by a counterfeiting ring. Inflation soared, and for weeks players would log in each day to find their assets worth less and less.

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