Compromise and Conceit

Terra Nova blog report on the results of an economic experiment they conducted in a virtual world. In essence, this experiment showed that increasing potion prices reduces the amount that players buy, suggesting that at least some commodities in some virtual worlds show price elasticity of demand. 

Not only does this suggest that economic laws work (inasmuch as economic laws ever do) in virtual worlds, but also suggests that virtual worlds could represent excellent places to test economic interventions. I would have thought that these experiments can be done pretty easily in World of Warcraft – the good Dr. A, for example, has a WoW add-on which analyses the sale price of all his possessions in auction. Presumably add-ons like this could be used to build up economic time series (even high-frequency trading data!) It would be interesting to see the results of a server-wide experiment in which Blizzard shut down access to all raw materials for a potion, and withdrew them from all stores…

I wonder how long it will be before we see economics departments negotiating with Blizzard for the delivery of experimental data. De-identified and anonymized, of course. Would such a negotiation have to go through an ethics committee? And if so, would the ethics committee be in the virtual or the real world? And if it was in the virtual world, would the Lich King get a seat?