valve-economics
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Valve economist examines TF2's 'sophisticated' barter system
We're not sure why Valve's economist is concerned with the finances of prestigious Covenant Elites in Halo, but the first publication from Yanis Varoufakis on Valve Economics is about exactly that. Only he spelled "Arbiter" wrong like 20 times.Oh, he's talking about "Arbitrage," the practice of capitalizing on the price difference between two or more markets, and its place in the Team Fortress 2 economy. That makes more sense, barely, but between the specialized equations and graphs Varoufakis offers some plain insight into the world of digital economies.For example, Varoufakis calls the TF2 barter economy "peculiarly sophisticated," noting that Steam's support system allows players to side-step the introduction of currency, operating solely on a "double coincidence of wants." This is something that civilizations for centuries have not been able to support for any protracted period of time, and its complexity is the reason we now have money, rather than things to trade with.The isolated nature of digital economies lends itself to intriguing happenings such as that one, as Varoufakis explains in great detail, we assume because he's thrilled to be able to calculate the exchange rates of laser guns and hats rather than boring old dollars and cents.
Valve has an economist now
Economist Yanis Varoufakis was analyzing the financial crisis in Europe, focusing on Greece, when he got a proposal seemingly out of nowhere. Valve co-founder Gabe Newell saw similarities between the situation in Europe and Valve's troubles with its own virtual economies (for DOTA 2 and Team Fortress 2, presumably.)"Here at my company we were discussing an issue of linking economies in two virtual environments (creating a shared currency), and wrestling with some of the thornier problems of balance of payments," Newell said in an email to Varoufakis, "when it occurred to me 'this is Germany and Greece', a thought that wouldn't have occurred to me without having followed your blog. Rather than continuing to run an emulator of you in my head, I thought I'd check to see if we couldn't get the real you interested in what we are doing."Varoufakis stopped by Valve HQ during a speaking tour and became excited about the possibility of researching a digital, fully recordable economy. "Think of it," he said, "An economy where every action leaves a digital trail, every transaction is recorded; indeed, an economy where we do not need statistics since we have all the data!" And now he's writing a weekly blog called Valve Economics. Unless, of course, he decides to do something else.
