Questions about the Castronova Article

Here's some questions to begin thinking about the Castronova article before class tomorrow. Please consider these as you read, or reread the article:

Castranova, E. (2001) Virtual worlds: A first-hand account of market and society on the Cyberian frontier. CESifo Working Paper No. 618. (39 pages)

Do you agree that virtual worlds are the “future of e-commerce?” Why?

“In Yee's study, many people used the term 'addiction' to describe their own behavior, perceiving their time in the VW as a source of serious conflict with various Earth activities and relationships. If we take the economist's view, however, and see their behavior as rational choice, we must conclude that VWs offer something that is perhaps a bit more than a mere entertainment to which the players have become addicted. Rather, they offer an alternative reality, a different country in which one can live most of one's life if one so chooses.”

What do VW’s offer that RW does not? How is that more attractive than RW?

Any inequality in the VW can only be due to one of two things: a) a person's choices when creating the avatar, or b) their subsequent actions in the VW.

Do you agree or disagree? Why?

Avatars come to view themselves as specialized agents, much as workers in a developed economy do. The avatar's skills will determine whether the avatar will be a demander or supplier of various goods and services in the VW. Each avatar develops a social role.

Agree or disagree? Why?

Developing the avatar's skills takes time; monsters must be killed, axes must be forged, quests must be completed. The result of all this effort, which can take hundreds of hours, is "avatar capital": an enhancement of the avatar's capabilities through training. In most VWs, capital is given by a number called the "level," so that an avatar at level 6 who kills 100 kobolds is given an increase to level 7. With that increase comes an enhancement of the avatar's abilities, which then makes the avatar a more attractive social contact. The avatar faces the same sort of social reward systems as are found in earth society.

What social reward systems do you find in SL? Are they similar or dissimilar to RL? How?

Do you agree that scarcity is what makes VW’s compelling? Why or why not?

“It is important to stress that the external market for Norrathian goods is underground. Sony has stated that Norrathian items are its intellectual property (Sandoval, 2001). Trading these items for US currency is considered theft.”

What do you think of this policy? Is it better to give intellectual property to users? Why or why not?

What is the effect of inflation/deflation in VW’s on RW economies?

How can VW’s induce widespread changes in the organization of earth society?