The Monetary Value of Virtual Goods: An Exploratory Study in MMORPGs

This study investigates the monetary value of time spent in virtual worlds in the context of 24 most popular MMORPGs. Building on classic economic theory, we approach this issue through a combination of theoretical modeling, experiment, and cross-sectional time series data analysis. Our findings suggest that intensive social networking and flatter social hierarchy structures are associated with lower monetary value of time spent in-game. Further, two opposite network effects on the monetary value of in game time spent were observed: One is the positive network effect from the active user base; the other is the negative network effect from the intensity of social networking. Both are strengthened by steeper social hierarchy structures. The implication is that social networking and hierarchy structure can be two effective angles for game developers or policy makers to address the issue of real-money trading of virtual goods.