EvE Online Economy

Yesterday I wrote about how the typical MMO economy works. Granted I focused on World of Warcraft because that is what I am most familiar with but also because with its multi-millions player base it is also what most other people are familiar with. However I have observed the same mechanics at work in other MMOs such as Everquest 2, City of Heroes, Lord of the Rings Online, Pirates of the Burning Sea, etc. There is, however, one exception and that exception I mentioned yesterday; EvE Online.

EvE Online’s economy rarely exhibits the non-intuitive trend of base materials costing more than the finished goods they produce. There are four reasons for this.

First off EvE Online is run on a single server. Where most other MMOs break up their player base into chunks of about 2,500 – 3,000 players per server EvE Online routinely breaks 30,000 players on its sole server. On top of that EvE Online does not artificially segregate it’s player base into even smaller chunks. WoW, for example, has very little cross trade between the Alliance and the Horde. City of Heroes, when I last played, had no cross trade between heroes and villains. Their representative economies are measured in hundreds, maybe a thousand or so players whereas EvE Online’s economy is 30-50 times larger than that. It is impossible for any single producer to ever create enough to meet the need of the entire market.

Secondly the EvE Online market is not global. Each region has its own flavor of raw materials. Prices cannot be seen from region to region unless one actually travels to each one. EvE Online’s universe is huge so it is also impossible for any one person to keep tabs on the economies of all regions at once. Also local politics prevent people from trading freely across all lines. This creates plenty of opportunity for real arbitrage by moving materials/finished goods into the central hubs and back out to the fringes.

Third on the list is the recycling of parts. Everything that can be produced in EvE Online can be broken down into raw materials. So at any time if a person finds that they can purchase items, recycle them to the raw materials and sell those raw materials for a profit, it will be done. This ensures any items which are priced too low are removed from the market.

Finally both production and training take a long time in EvE. EvE’s training is based on the real-world (on and offline) time. All character that are a month old have had 1 month of training under their belt. Some may have spent the time more wisely than others but overall they would be comparable. To train all skills in EvE Online, the last time I played, would take over 3 years of real-time training. Because of this no individual character can do it all. You can be a great trader, a capital ship pilot, an excellent warrior, a full-time miner or a businessman but you cannot be a trader-capital-ship-pilot-warrior-miner-businessman.

Along with the real time training is the length of time it takes to produce items. The top tier items in WoW can be made in 30 seconds once the materials are gathered. The top tier items in EvE Online can take days (Weeks?) of actual production time.

Put plainly, months of training plus days to weeks of production time means the manufacturing step has value. Cranking out a piece of armor in 30s is really no impact. A corporation tying up their production facilities for days or weeks at a time to crank out a large scale project is not producing anything else for sale during that time. That time has value and is reflected in the sale price normally being higher than the cost of the materials going into the project.

Of all the economies in MMOs EvE Online’s is the one that fascinates me the most. Outside of the tax rate the developers put very little money sinks or controls into the game. The main money sink comes from the players themselves. Vast tracts of the universe are unregulated by NPCs in any way. This space (0.0 or Null space) is home to dozens of alliances made of up hundreds of player run corporations. They make the rules in the space they control and often control of space is contested in spectacular fleet battles. Battles where millions, if not billions, of credits are lost in the destruction of ships and their components. With practically zero regulation from the developers it is interesting to see the economic theories at the core of capitalism and free markets at work.

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