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The Economics of Gaming: How One Player Broke an MMO and Launched a Career
27 Plays7 hours ago
Guest: Andrew Wagner, Author of Economics of Online Gaming and Founder of Wagner Road Capital
CoHost: Lewis Ward, Research Director @ IDC
🎙 Episode Summary
What happens when a high schooler treats an MMORPG like a business case study? Andrew Wagner joins Player Driven to share how his time playing Eternal Lands turned into a crash course in economics, strategy, and systems thinking. From building a ruthless guild to influencing the game’s developer roadmap, Andrew didn’t just play — he disrupted.
We talk about market incentives, reputation management, and the blurry line between capitalism and corruption, both in games and in the real world. If you’re building economies, managing communities, or just love a good player-driven story, this one’s for you.
🧠 Highlights with Timestamps
2:34 — Learning economics through RuneScape-style gameplay
Andrew shares how Eternal Lands introduced him to core economic principles like supply and demand, specialization, and market incentives — all before he took a single college class.
7:59 — Embracing the villain role to change the game
Instead of rebuilding his guild’s reputation, Andrew leaned into their “bad guy” image, creating a strategy that ignored perception and focused purely on market disruption.
14:16 — How gaming shaped his real-world investment career
From managing a guild to managing portfolios, Andrew explains how the lessons from in-game economies now guide how he evaluates companies and competition in the financial world.
30:10 — Building an in-game advisory board of real experts
With rocket engineers and bankers in his guild, Andrew leveraged real-world insights to refine his strategy — proving that the best guilds function like startups.
49:50 — When players capture the dev team
Andrew recounts how a former guild member joined the dev team and created a secret mine just for them, triggering a real example of regulatory capture inside the game.
- Check out Andrews Book: https://www.amazon.com/Economics-Online-Gaming-Introduction-Economic-ebook/dp/B084Z77PSW
- Andrews Website: https://www.wagnerroadcm.com/
- Andrews Substack: https://wagnerroadcm.substack.com/
- LinkedIn: https://www.linkedin.com/in/atwagner/
🎧 CTA
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Transcript
The Logic of In-Game Economies
00:00:00
Speaker
Ever play RuneScape or some grindy MMO and wonder, wait, why is this sword more expensive than that one? Or why the in-game economy sometimes feels more logical than real life? Spoiler alert, it's not just a game, it can mimic real
Andrew Wagner's Market Experiment
00:00:14
Speaker
life.
00:00:14
Speaker
And for one high schooler, it did. Meet Andrew Wagner, the guy who took down an entire MMORPG economy just to see if he could. From virtual monopolies to real-world investment strategies, this isn't your average gamer-turned-finance-guy story.
00:00:28
Speaker
It's a tale of how a teenager used an obscure fantasy MMO to break the market, build a guild empire, and unlock the secrets of real economics, all before Econ 101. And if you like this type of content, please be sure to like and subscribe to Player Driven. We share all types of content on the platform, and today we are diving into how real-world economics collides with in-game economics. Welcome to Player Driven.
From Gaming to Finance
00:00:54
Speaker
So I have my own business. It's called Wagner Road Capital Management, where I manage stock portfolios for a group of investors. I also do consulting with professional investors to help them find investment ideas that fit their strategies.
00:01:09
Speaker
I have a website and I also have a sub stack where I post every couple of weeks. What I do in my personal life, or what I used to do before I became a parent, was I used to do a lot of traveling.
00:01:22
Speaker
So I've been to all 50 states. I used to do a lot of hiking, a lot of reading, and way more gaming than I do right now. But I just don't do as much of it right now since I've got a little baby Appreciate you, Andrew. I'm excited to dig into this, especially I'd love to analyze the bottom five states that
Introducing Lewis: XR VR Gaming Insights
00:01:41
Speaker
you've ranked. I think analyzing the bottom of the list is a lot more exciting than the top of the list. But before we go on, Louis, you are also joining us. You helped us put this one together. And as always, we very much appreciate Louis. He is the head of XR VR gaming research at the IDC.
00:01:59
Speaker
Louis, you want to say hi Hey, everybody. Pleasure to be back on the Player Driven Podcast. And yeah, excited to talk to Andrew Wagner about his book and kind of life in general these days. But yeah, it's an interesting topic for me. So I'm glad our interests coincided here, Greg.
00:02:15
Speaker
We've dragged Lewis off of the beach today. It's very hot here on the East Coast, so we appreciate
Learning Economics through MMOs
00:02:21
Speaker
him being here. But we're going to start with you, Andrew, because your gaming roots, you have one of the coolest background stories, like I said, we going in coming into this, right? You figured out how in-games economy worked before you even studied economics. And I'm curious, you know, through this whole, if you could give us the story and going into it, did you realize that you were...
00:02:42
Speaker
studying economics or did it kind of click later because just kind of i'd like to connect the dots so how did all this actually start to connect to and what were you playing at the time so the game i was playing is called eternal lands it's very similar to runescape so anybody who's played runescape will immediately understand what this game is about medieval fantasy themed game
00:03:08
Speaker
where you can choose to be somebody who fights monsters, or you can choose to be somebody who makes weapons and armor and sells that stuff to the people who are fighting monsters.
00:03:22
Speaker
And that's basically what the game is. And what I decided to do in this game was become a producer and make weapons and armor, sell that stuff to the other players,
00:03:37
Speaker
And I didn't realize that it was economics at first, but the deeper I got into the game and the more I explored how the market works, the more I realized that this is what economics really is.
00:03:53
Speaker
And this is something that I can learn from. And then what I decided to do was, this is a game, it doesn't really matter what I do because if I screw it up, there's no consequence.
00:04:08
Speaker
I could just quit the game and do something else. And I just decided to keep
Innovative Guild Strategies
00:04:13
Speaker
experimenting. And that was how ah basically learned everything that I know about economics just from playing this game and doing this kind of experiment.
00:04:23
Speaker
How? At this stage, you're in high school, right? Like what kind of notes are you taking? How do you even start to kind of deduce what's going on in game?
00:04:36
Speaker
That's a really good question. i might need a couple seconds to think about that one. I just imagine these notebooks, which are like full of code words and code phrases and stuff. And like, you know it and it's like a beautiful mind type of stuff.
00:04:53
Speaker
Well, I wish it was that sophisticated, but fortunately, most of it was just online because what I did was I started was called a guild and we we're like a manufacturing guild. So we would produce things and it was all basically internal to the guild's forums where someone throws out an idea, other people respond to it. This is what we're going to do.
00:05:20
Speaker
and The notes were not all from one person. Not everything that happened was all my idea. i was just the driving force that said, this is the direction we should go.
00:05:34
Speaker
How are we going to make this happen? So a lot of it was ah collaboration among a lot of really smart people. And they were happy to just let me be the face of it because being a high school kid, I had way more time than anybody else.
00:05:49
Speaker
And I could treat it like a job. where other people had real jobs that they had to go do during the day. i You know, it's very kind of akin to what kind of community managers and content creators do for games these days. And you were kind of the first stage of it where, you know, you're just true lovers of the game and you want to create content and document and figure out what's happening and share it with everyone. And it's so cool that like,
00:06:15
Speaker
these visions you've seen before they are where they are today. And I don't even know what your level of gaming is today. And if you're that vested in kind of what's happening in gaming today, but I've always become one to believe that history repeats itself. And it kind of seems like that's the case, kind
Evolving Gaming Approaches
00:06:30
Speaker
of it's this cycle of gaming where now content creators and people are creating stuff and showing it off and sharing. And and don't know, I'm rambling here and I think it's just very cool stuff.
00:06:39
Speaker
Yeah, I wish that ah I could have done that. But at the time, There was really no live streaming. There was nothing like that. it was This was all on the forums.
00:06:52
Speaker
We're going to write down what we're doing. We're going to write down how we're doing it. We're going to go back and forth. And i can i can give you the summary, I guess, the story of of what I actually did that might be helpful.
00:07:05
Speaker
I actually started this guild with my brother. What happened is so we we had a lot of really obnoxious players who gave like the guild a really bad reputation. And it came down to, what do we want to do with this?
00:07:21
Speaker
i ended up kicking my brother out of the guild. But he he got over and we're friends now. So it's fine. Wild turn of events, but keep you going. And I asked all the people who didn't leave, because we were basically pariahs.
00:07:36
Speaker
no No one wanted to do anything with us. because we had such a bad reputation. And the question was, do we try to change the name of the guild and try to change the way we play to improve our reputation?
00:07:51
Speaker
Or do we just say, we don't care what anyone else thinks and open up a way of playing that nobody else would ever even be able to think of because their first thought is always, what would a good person in the game do?
00:08:09
Speaker
And I turned that around and said, what would a person who doesn't care how they're perceived do in this game? And that made the game a lot more fun, at least to me. I thought it was more fun that way.
00:08:27
Speaker
Because then I wasn't constrained anymore. So I turned the guild into a business.
00:08:36
Speaker
And I thought about how am I going to make this guild make money in a way where they don't actually care what other people think. And I had some experience with a guild that I was in before where they were producing weapons and armor, but since they wanted people to like them, they would not do anything to harm their competitors. They just all wanted to be friends.
00:09:03
Speaker
And i decided no one wants to be friends with us anyway, so why would I do that? Let's just do whatever we want. And I figured out that when you're producing items in the game, the players that are creating this stuff, they don't actually care if it's worth money.
00:09:23
Speaker
They want the experience points so that they could level up. So I just persuaded a bunch of players that they could level up faster by helping my guild produce this stuff.
00:09:35
Speaker
And that way, and we didn't care what it costs. We didn't care how much money it would make. It was all about helping these players level up as fast as they possibly could.
00:09:46
Speaker
And that just naturally ended up with a bunch of stuff. And I took that stuff and I dumped it on the market and put a bunch of people out of business. And that's basically the summary of what happened.
00:09:59
Speaker
<unk>s funny, I play these games and you always want to be the good guy or you always want to follow the path that you're used to following. And it's hard to turn your brain the other way and just say, screw it. I'm going to be and it just to make, my I don't know, it's a mindset. I feel like a lot of people have trouble.
00:10:14
Speaker
engaging with. Yeah, it's interesting to hear you reframe, you know, your approach to the game, Andrew, because um ah you did pursue, based on the book, um you know, what you described doing, but there's some nuances to
Social Aspects of MMOs
00:10:30
Speaker
it. So if it's all right, I will jump into a series of questions to kind of run through parts of what you said, and maybe we'll just riff off of this for a little while.
00:10:37
Speaker
Sure. Yeah. So let me start with the connection point that Greg made early on, which is that you wrote that in economics of online gaming, that online games are simulated markets, but they function based on real economic rules.
00:10:53
Speaker
These decisions start with the idea of looking for how to make choices with limited resources, et cetera, et cetera. You also said it involves behavioral sciences. Why do people choose this role? How do players respond to changes that are made in the game, et cetera?
00:11:06
Speaker
And I guess my question is, you know, given your gaming experiences and in real life now experiences being a, ah was it a master's degree, a graduate degree in economics? what Where did you stop again?
00:11:17
Speaker
Doctoral? I got a master's degree. Master's degree. Yeah. So, you know, given all that, you know, when you've experienced in these games, what motivates people, right? You talked about the economic side of and I can totally understand that, but there are non economic reasons why people play MMORPGs.
00:11:33
Speaker
You talk through that. They just want to advance in the game. That is not an economic rationale that you would necessarily find in the real world. So I guess my question is, you know, given your experiences, um,
00:11:44
Speaker
complex social and economic games, you know, like the one you played and grew and mastered and kind of broke in some respects. um You know, what do you think motivates people to engage in those sorts of games? What is it about them that's attractive?
00:12:00
Speaker
And it could be economic or non-economic.
00:12:04
Speaker
My personal opinion, ah game like that is something that people do just as a social activity. I think that's the main reason why people play MMOs.
00:12:17
Speaker
They are there to be around people who have a common interest, people they're probably friends with after a while. i think that's I think that's the reason that people play MMOs.
00:12:30
Speaker
And I don't think it's really any more complicated than that. And these games are more fun because they're multiplayer games. And if you played it by yourself and there was nobody else in the game, it's not a very fun game. i mean, that's what makes an MMO fun is the other players.
00:12:48
Speaker
You've navigated ah virtual game economy to a career investment research.
Gaming's Influence on Career Path
00:12:53
Speaker
And, you know, what specific principles, market dynamics, competition, player behavior, you know, how does the stuff that you extracted from your intense game playing time, I guess, before you became a parent, um you know, do you apply those, you know, in your practice to, you Do the stock stuff, do the investment stuff. Like how do those rules and and thought processes impact what you do on a day-to-day basis outside of gaming?
00:13:19
Speaker
um Yeah, I can start with with how this whole thing got me interested in in the business world in the first place. So playing this game and the stuff that I learned in this game and the stuff I did in this game got me interested in studying economics and made me want to be an economics major.
00:13:37
Speaker
And... I found economics to be incredibly easy when I started my college classes. And it was around the time I was a sophomore in college and I was at a Christmas party and I'll never forget it.
00:13:52
Speaker
And I'm telling my classmates, this is why economics is so easy for me. This is why I always have the highest grade in the class, all those other things. I was telling them the story and they just kept telling me, you need to write this down.
00:14:06
Speaker
you need to use this in some way, which was crazy to me because I had actually just thrown away all of my data because it was a game.
00:14:18
Speaker
I just played a game. I didn't really care about it. I didn't care what happened with it or any of that stuff. But it was actually my classmates who persuaded me to write this down in the first place.
00:14:30
Speaker
And I said, okay, if if people are insisting that this has some kind of value, then I'm going to take the time to to make sure that it can be valuable for somebody else.
00:14:42
Speaker
So I wrote it down and then i thought, what am I going to do with this? So I found a professor who didn't know me.
00:14:52
Speaker
he He didn't know who I was. And I just thought, I'll get this guy's opinion and he'll be honest with me. And i walked into his office on his office hours and I just said,
00:15:05
Speaker
I am working on a paper and i need the opinion of an expert, things like that. And since you don't know me, I know you'll be honest.
00:15:18
Speaker
And he said, oh yeah, sure, I'll help you. And i actually still have it. i I still have the thing that I gave him. It was this. And he said,
00:15:31
Speaker
That's insane. and silence He thought I was going to give him a 10-page paper, and I gave him this half, I don't know, half-inch, maybe quarter-inch notebook.
00:15:44
Speaker
And he said, that's insane. But to his credit, he actually did read it. And when he gave it back to me, he said, never make anyone read this whole thing ever again.
00:15:55
Speaker
so ah that was my first review of the the first draft of my book was never make anyone read this but he encouraged me to use one of the chapters as an academic paper so that's what i did i took one chapter which was about the game's design and i used that chapter as my senior thesis in economics So I wrote my senior thesis in economics when I was a sophomore and I did absolutely no work on it because I had done all of that research while I was in high school.
00:16:31
Speaker
And i thought, let's just keep going with this and see where it goes. So I submitted it to a conference. And the response from the people running the conference was that this paper doesn't really have as much math as most economists would want.
00:16:50
Speaker
But they were excited about the idea of using games to make economics more interesting and more exciting and easier to understand.
00:17:04
Speaker
So I had a very nice time slot for my presentation, where most other people had two other two other presentations happening at the same time.
00:17:17
Speaker
mine was the only one for that time slot right before lunch and everybody there got to see what i had to say and i'm not sure how this happened but right when i got home there was an email for me from the graduate department of economics at my university that said, if you want to go to grad school, we'll pay for it.
00:17:44
Speaker
So it was basically this, this thing that I thought was nothing because it was just a game that I played and I just kept going forward with it, ended up being what paid for my master's degree in economics.
00:18:00
Speaker
And i didn't really keep going in that direction because when I started my master's degree, my major professor said, you need to do something that's gonna get you a job and this isn't gonna get you a job.
00:18:16
Speaker
So I didn't continue with the gaming side that much. I focused more on the business side, but that's part of what also got me interested in doing investment stuff because as I was learning about economics, I was also learning more about business at that time.
00:18:35
Speaker
And I was reading books about investing and nobody knows about this, but one of the people in my guild, while I was in high school saying, I'm kind of interested in business and investing.
00:18:52
Speaker
He said, I have an investment account. You can manage part of my investment account for me.
00:19:00
Speaker
So I. MMOs, the beauty of MMOs. Yeah. um I don't know if I'll get any trouble trouble for doing that. This was 20 years ago or something like that. But that was part of how I got started in thinking about investments and and doing investments.
00:19:18
Speaker
And ah I have to say that I feel very nice, or I have to say that it feels very nice that somebody who saw what I was doing in a game thought that i could translate it into stuff that I see happening in the real world.
00:19:37
Speaker
And to get that confidence boost as a high school student was really nice. But that does get into the question of what actually is relatable and how does it connect with the business world and the investment world.
00:19:55
Speaker
So the things that I think about that are that directly come from what I learned in this game, there's kind of two sides of it, just really oversimplified and
Business Lessons from Gaming
00:20:05
Speaker
and really quick. But it's it's things that I took from playing this game that I use almost every day.
00:20:12
Speaker
I like to think about where a company fits in its industry and how it competes with other companies. So for example, do they only care about price?
00:20:25
Speaker
Or is it a combination of the price and the quality of the product they're selling? Is it how good their service is? And then what's the market structure like?
00:20:37
Speaker
Is it just a few very large companies? Is it a monopoly? it a lot of very small businesses? And then how big is the industry? i learned about all of that stuff just from experimenting inside this game.
00:20:52
Speaker
The other side of it is thinking about who the customers are and what impact they have on the business. So for example, are they providing something that the customers can't get anywhere else?
00:21:08
Speaker
Do they have to buy it from this particular business? Or is it easy to replace? Is it something they can easily go somewhere else and buy from somebody else?
00:21:19
Speaker
So it's very basic business concepts like that that are incredibly important in the business world.
Player Innovation and Developer Responses
00:21:25
Speaker
I would like to circle back to one of the points you made about the design of the game, because in some ways, Greg and I were at Games for Change in New York, ah I guess, the end of last month.
00:21:36
Speaker
And there was a talk by a professor, Zim Imran there, who teaches at NYU School, like design for, that's one of the, like, I think the top two universities for game design. And in his talk, um he talked about the rules of play, or actually his second book from 2022 was like, The Rules We Break. And it's about how in a game environment,
00:21:55
Speaker
human beings will naturally want to push up against the boundaries of what is allowed by the designer, and they will find those weaknesses and exploit them. And I feel in some ways what you did and what you were what you really did was innovate within the framework that I believe his name was entropy,
00:22:13
Speaker
that the guy, Aurelion, maybe I got the name wrong, the dev behind that game had certain rules in mind. They designed the rule a certain way. You went into that. Most people played along the rules they thought would be nice and all this.
00:22:25
Speaker
You found out where the boundaries of those rules were and you pushed them and ultimately subverted them, a topic we'll come back to, But i just want to get your impression about, you know, when you say you were being wearing a black hat, as it were in that game and doing things that other people wouldn't do, in some ways, what you were doing, like a capitalist market system tends to do, you're going to find out where the rules are, where the boundaries are, and where you start feeling actual pain for bad decisions.
00:22:50
Speaker
And I'm just curious if that, if what I just said resonates with ah your experience as as a high schooler, but also in the real world that you've learned since. Yeah. So the the developer went by,
00:23:01
Speaker
entropy so entropy is the the developer's name and i guess it's kind of natural for somebody who's in high school to test boundaries and to do things the way you're not supposed to do them so it totally makes sense that i would be very interested in taking that approach as a high schooler and maybe not as interested in doing it now and i do know that as i wrote draft after draft of this book, I became much nicer, i guess is is a word for it.
00:23:39
Speaker
Because over time I realized there wasn't much need to say anything really bad about the game designers or the moderators or any of that.
00:23:53
Speaker
Because the history of the game, some of the design choices that they made were because they made mistakes earlier and they were desperately trying to avoid making the same mistakes.
00:24:06
Speaker
So they went too far in the other direction. So a lot of the things that I was very critical of in the past, as I did more research on the game's history in the background, it made a little bit more sense why they wanted things to be a certain way.
00:24:21
Speaker
You know, you you talked about pushing the boundaries, right? And how do you know what questions to ask? How do you know this is going to create market scarity scarcity? Or like you're in high school, like what is your end goal that's making you push this to see what's going to happen?
00:24:37
Speaker
i don't know if that makes sense. ah That's a great question. I didn't have an end goal. There was some point in the game... where I decided i am doing this to learn as much as I can possibly learn.
00:24:52
Speaker
And that was my goal. And I remember the people in my guild just saying, I don't care about that. I'm playing this game to have fun. I'm trying to have as much fun as I want. You can learn whatever you want to learn.
00:25:04
Speaker
And so they just went along with my crazy experiments because to them it was entertaining. But to me, at some point it was... i want to try this because i'm going to see what i can learn from it and using a game to do that means there's absolutely no consequence if you screw it up and there's no consequence if it doesn't work other than i don't know maybe you could get banned if you were really bad but to to me the the question of pushing the boundaries just became how much can i learn from playing this game
00:25:41
Speaker
Where do the bigger learnings
Choosing Advisors: Gaming vs. Business
00:25:43
Speaker
come from? Do they come from the economies changing, aka you're getting more money, or you're guild saying, what the hell are you doing? I'm not having fun anymore.
00:25:55
Speaker
i I think that's a very interesting question, and it's something that I love to talk about because this is kind of the secret behind what I did. the The real actual secret behind what I did is that it wasn't really...
00:26:09
Speaker
economics based it was that i was very good at finding the right advisors i was very very good at finding people who had the right experience where they could help me understand what was going on for example i had two people in the guild who were actual rocket engineers There was a guy who was a banker.
00:26:35
Speaker
There was somebody who was a small business owner who had sold his business and was retired. I had people like that that were in my guild that I had made basically part of my advisory team.
00:26:49
Speaker
And when I say I want to learn as much as I possibly can, and I'm talking to people who are twice my age, They're happy to share what they know. And that is what I felt was the most valuable part of what I was doing.
00:27:04
Speaker
It wasn't based on any of the economics. It was really all about the people that I was lucky enough to have around me when I was doing this. Well, I almost think you were, yeah almost like they were mining for picks and shovels or you were you were doing that stuff, but in a way you were mining yourself for something you were passionate about. In other words, you were able to tap into something you wanted to know more about.
00:27:26
Speaker
And it just so happened that this MMO was a vehicle for other people to say, okay, I'll throw something in your pot that makes sense to them. And so you kind of ran with it in a way you discovered something that you're passionate about and I guess was the right path for you since you're still doing it.
00:27:39
Speaker
Yeah. Yeah, that's, that's basically the great summary of it. You talk about in one point in their reputational capital. So, so your guild Reva use its market power, um, in some ways to, you know, it would be, it would be honorable in some ways, but you could push the boundaries. If you pushed around other players, you know, you could quote possibly jeopardize some of its sales.
00:28:02
Speaker
So in that exchange where we, we talked about it briefly before the podcast, you brought up the reputational capital in your view. hurt companies like el Elon Musk, Tesla, in that he took a reputational hit.
00:28:15
Speaker
And I guess my question is, you know, can you talk about reputational capital, both in the in the game context you learned of of Riva, I guess the Guild, And then in the real world, and you don't have to use Tesla as an example of somebody who, you know, paid a price for, um you know, doing things that a large share of its customers might not want. But i'll I'll open the floor to you in terms of what what is important about reputational capital and what did you find out crosses the virtual physical divide, if you will?
00:28:48
Speaker
Yeah, I can give a little bit of context about where I ah encountered that in the game, just ah just to draw that bridge. I was part of another guild before I created my own guild, and that that guild that I was in was called Riva.
00:29:03
Speaker
And they used a very similar strategy where they just produced a lot of stuff, but they didn't want people to hate them, so they kept prices at basically the market level so that all the other players selling stuff would think they're good, nice, honorable players.
00:29:19
Speaker
And then when I had my guild, which was named Rich, which is just the best name for a villain you could possibly think of, it's such a stereotype.
00:29:31
Speaker
And we didn't care really care about reputational capital, where we just cared about money because we called ourselves Rich. And that changed the dynamic of the game, where if everything was based on price, the reputation didn't really matter.
00:29:52
Speaker
The buyers would go to whoever was selling the for the cheapest. But if they cared about other things like quality and service and all that, reputation would matter a lot more.
00:30:04
Speaker
And if you think about that in the real world, it's kind of a sliding scale. So the more somebody needs the product, the less it matters who sells it.
00:30:17
Speaker
which is why you get companies like Comcast that have a really bad reputation, but people still use it because they have to. So in some cases, it doesn't really matter.
00:30:32
Speaker
And then it's also related to the size of the business. If there's a small restaurant that has a bad reputation, it's probably going to go out of business. But if it's a really big business, they can take a hit to the reputation and still be okay.
00:30:45
Speaker
So something like Tesla, where it's taken a reputational hit, it's still a really big business. The business is harmed, but they're not going out of business the way a small company would.
00:30:59
Speaker
Yeah. um Also, you wrote in Economics of Online Gaming that... um um that there was a boycott, right? So your guild did very well. It started to undersell the competition that pissed people off and that you're, I think the message boards went crazy.
00:31:17
Speaker
And um part of the other producer community out there, the other manufacturers tried to collude in some senses and tell their ah players, if I got this right, members to not buy from you because you were undercutting the market and ruining the game and all this stuff.
00:31:34
Speaker
um And so there was kind of a boycott, an informal attempt at a boycott, but it didn't hold,
The Impact of Boycotts
00:31:40
Speaker
right? In other words, they tried to avoid you, but because you were less expensive, eventually people just gave in and the cartel fell apart and the boycott fell apart.
00:31:50
Speaker
And I guess my question is, you know, It seems like your consensus, both in the game and in the real world, is that boycotts have limited effect. But I just wanted to to understand if i if I grasp your take on the efficacy of boycotts and you know what are the advantages and disadvantages that I guess end users can have or other producers can have when they're trying to inflict pain on a producer they don't think is is acting you know ah behaviorally appropriately.
00:32:24
Speaker
Are we boring you, Greg, yet? I think this is fascinating. but i get I'm curious if you're like an evil person in real life or it's just that like the yeah ah online stereotype. Not evil, just like, yeah, we'll be evil. but I think he's like kind of ruthless. ah is gecko His Gordon Gekko kind of you know side came out in what he was doing, although he hasn't said that.
00:32:44
Speaker
Well, I actually can answer that because people love to think about that. There are people who know me and they know that I'm a very nice person and I only do this kind of thing inside a game.
00:32:59
Speaker
So if you play a board game with me, you're going to have a bad time. But the other thing that I actually did was after I quit the game,
00:33:11
Speaker
i went to all of these players who were very, very upset with me about the way that I played the game. And I actually apologized to most of them and said, you know i'm I'm sorry that this made the game not fun for you.
00:33:25
Speaker
i' a high school student, and I was trying to learn things. And almost all of them understood, and they they were OK with it. when When I explained that what I was doing in this game was really just a game, and I was trying to explore different things you could do in the game, and I also really felt like I was playing a character, and I chose to play this character in a certain way.
00:33:51
Speaker
And I know a lot of people who've played something like Dungeons and Dragons will know very well that you have a character and you set this character to behave in a certain way and that's how you decide to play the game.
00:34:05
Speaker
So it's it's really like that. I promise I'm very nice person. Just rip your throat out in an investment sense or a competitive sense.
00:34:17
Speaker
Well, if you play a board game with me, you'll have a very bad time.
00:34:23
Speaker
I don't have much to say about about boycotts in general or even the boycott of of my own guild because what really happened is they told people not to buy from me, but then everyone had to question, how much more am I willing to pay to avoid buying from this guy and the answer was no one was willing to pay more to avoid me i mean that's that was basically the answer because that hurts your status in the game ah effectively if you're if you are paying more money
00:35:03
Speaker
to buy things that you need to level up, that will make you level up slower. So you're not going to do it. Because that was everybody's goal in the game was to level up as fast as they possibly could.
00:35:15
Speaker
And anything that would make them slow down, they're not going to do. So when the guilds were telling their players not to buy from me, they just wouldn't listen.
00:35:26
Speaker
They just would ignore that. that So wasn't much of an issue. It wasn't much of an issue, but boycotts in the real world are a little more complicated because usually it's something about this business is doing something in a way that we don't like.
00:35:45
Speaker
We're going to boycott them to get them to change their behavior. That can be successful and that has been successful, but it's really challenging because the first part is you need to convince a lot of people to participate.
00:35:59
Speaker
and it's hard to get a lot of people to agree on anything. And then you also have to sustain it. So even if you get a lot of people to participate, you have to get all of those people to participate over a long period of time.
00:36:13
Speaker
And over a period of time, they either just forget about it or they move on to another issue that is in the headlines more than what they're trying to boycott. So it's not that boycotts never work or that they can't work.
00:36:27
Speaker
It's just very, very difficult to get a large enough people to participate and to get them to participate for a long enough period of time for it to actually work. That makes sense.
00:36:38
Speaker
um My next question was about Rich. um You said that you know it was it was kind of it was doing manufacturing was kind of predatory, and then he got into crafting, and you're even more predatory.
00:36:51
Speaker
And the quote is, the bigger Rich became, the more its advantage grew. The economies of scale that Rich was using for production was improved by its processes of using Richery, which I think is an NPC non-seller agent, to sell products.
00:37:04
Speaker
Rich was now a well-known monopoly that could influence market prices in a severe way. um So I guess my question was, you know, once you became a monopoly in crafting, right? So you went for manufacturing, you dominated that, and then you went into crafting and became even more predatory, became basically a monopolist in that space.
00:37:24
Speaker
And we've already talked about how you pissed off a lot of the fellow players who were like, this guy's not playing by the rules we thought existed. um You know, i guess two-parter. One is like, you know, once you are once a monopoly emerges, what are obviously the monopolist benefits?
00:37:40
Speaker
What are the downsides for the rest of the player community when any party in a competitive market system is allowed to become a monopolist? So put yourself in the other player's shoes, as it were.
00:37:51
Speaker
And then secondly... again, was Entropy asleep at the switch? Because he must have noticed that you became a monopolist within the crafting market in your guild and that people were pissed off. And I'm just curious about, you know, why didn't he step in to try to do something or was he trying to do something and just didn't work?
Open Strategy and Player Engagement
00:38:11
Speaker
I think I can answer the question about Entropy first. so Okay. i
00:38:19
Speaker
I told him what I was going to do. And I told him what was going to happen when I did it. And I told him how to prevent it. And he didn't. okay i My plans were not a secret at all.
00:38:38
Speaker
In fact, I told everyone in the game what I was going to do. And i think that this is one of those things where my view of it has softened over time, seeing how there were some mistakes that he made early in the game's development that made him decide he was going to allow the game to go in a different direction.
00:39:04
Speaker
And I also think he liked... the way that this drama brought attention to the game and it actually made people play more than if there was nothing happening.
00:39:16
Speaker
But that's just my opinion. i I don't know his exact thinking on that. But I do know that he did like how much attention it was bringing to the game. I guess you're right. You really stirred the pot.
00:39:27
Speaker
I guess that's true. Which when you talk about no consequences in the real world, perhaps people would have been more irate about it if their actual businesses crashed. Right. But in this game, it's like, well, OK, I guess that happened. And I guess they can go play some other part of the game or whatever.
00:39:41
Speaker
I just had a podcast on protecting your community. And here we have Andrew just saying, take over the community. we're gonna Well, it's funny. I guess if it was in the book, I forget that he said, I warned him what I was going to do.
00:39:53
Speaker
And then I did it. And then exactly what I said was going to happen, happened. I i don't remember reading that, but maybe it was in there and I just, I don't didn't stick in my head. I didn't put that in the book because I thought it wasn't very nice.
00:40:05
Speaker
so okay I see. i see. I left that one out of the book. But i I was very open about what I was doing. And I i told everyone this is what I was doing. and And then after it had an effect, I said, this is how you can stop it.
00:40:21
Speaker
And the players who were affected by it would tell him, don't listen to that guy. So I don't know. the question on mono monopoly the downsides for everybody else of monopoly yeah for a monopoly it really depends on what type of monopoly it is for example if it's a monopoly that's created just by having the lowest cost and then having the lowest pricer prices, then generally consumers can actually somewhat benefit from that.
00:40:56
Speaker
They might see lower quality products, but if what they care about the most is price, then consumers are being best served by that type of monopoly. Of course, that's not great for anybody trying to compete with their business.
00:41:12
Speaker
And that's... can cause some other issues if somebody that has better quality products wants to compete in this market but it's something that everyone cares about price
00:41:26
Speaker
but in other ways if the monopoly is the only place where people can buy from then they could really squeeze out their customers so they could capture just a little bit extra money that they maybe didn't earn in any way and some people would say don't deserve but didn't earn is probably a more accurate way of putting it so that can hurt competitors and it can hurt consumers if you have a monopoly of that type so it really just depends on what type of monopoly it is
00:42:06
Speaker
And I would argue that the monopoly that I had in this game was more of the type where consumers benefit greatly by having better prices. But all of the competitors would argue that the game wasn't very fun for them that way.
00:42:22
Speaker
And I guess you mentioned Comcast earlier, not to put you on the spot for that, but but in some senses, I think you were implying that they're approaching. I know i know that the telecom market is is concentrated in many ways. And so that may and be be an example. It's not a monopoly, but it's, you know, there's like three or four giant tele telcos around the U.S.,
00:42:45
Speaker
and that they may be extracting rents or whatever the the correct term is for you know price gouging, be the unkind way, um where they deliver worse quality service, but they still keep charging or they help drive inflation because they can just keep raising prices. But anyway, don't answer to that if you don't want to.
00:43:03
Speaker
Well, the only thing I would have to say about that is... when Google Fiber says we're coming into this neighborhood, I know that Google isn't doing that anymore, but when Google Fiber would say we're coming into this new, this neighborhood and we're going to offer Google Fiber, suddenly everyone got really good deals on their internet.
00:43:24
Speaker
So that's really the only thing you need to say about it. Yeah, yeah. Good, good point. Let me take it one step further on the the rule breaking that you engaged in economics of online gaming.
00:43:36
Speaker
So you said that there was a secret that you kept for a long time after quit the game. And the secret was that you were so well connected in the game as a guild that a person who was part of your guild, I think he quit to go work for the dev team,
00:43:50
Speaker
um started giving you special treatment inside the game itself. So the the quote was that he was working on a secret mine. The mine would have everything that Rich needed to make iron and steel bars.
00:44:03
Speaker
No one else would be able to find it unless a rich mo a Rich member leaked its location. This mine would allow Rich to completely break the game. So it seems to me that what happened here is that your guild became so powerful in the context of Eternal Lands ah that you kind of co-opted the development team itself and started getting more advantages than any other guild would have. I think you're right, that it did break the game.
00:44:34
Speaker
And I guess the question for you is, you know, in that game context and in real life, when any company is allowed to, any guild, any manufacturer, whatever it is, is allowed to break the rules of the game the way that you did it, isn't that the end of competition?
Regulatory Capture in Guilds
00:44:50
Speaker
Doesn't it destroy the concept of a market?
00:44:53
Speaker
Well, the short answer is yes. I can give a little more context on the story behind how this works. the thing with the development team happened too. So since this was such a small game and it was really one developer, he would take people who played the game to help him develop the game, which I thought was really smart because he would get free labor that way.
00:45:19
Speaker
But the problem was when you have developers who are also playing the game, there's this temptation to add things that are special benefits just for their own team or their own players.
00:45:35
Speaker
And anybody who joined the development team was required to promise that they wouldn't do that. And I had this guy in my guild. He was required to leave my guild, which most people were not required to leave their guild, but he was required to leave my guild because of the reputation that my guild had.
00:45:54
Speaker
The other people on the development team said, we don't want anybody in his guild on the development team if you're gonna join us you have to leave so he left and then he sent me a message and he said hey guess what i'm working on i'm doing this just for rich and what it was was basically a secret cave that had everything you needed to do to produce and most of the time you would have to
00:46:27
Speaker
walk like halfway across the map, gather materials, carry it back, but this you could do all in one spot. And it wasn't necessarily secret or illegal in any way because the other developers knew that it was being created too.
00:46:45
Speaker
But what the idea was, I think, I don't know all the specifics, but I think the idea was a player should stumble on this secret instead of already knowing about it beforehand.
00:46:59
Speaker
So knowing about it beforehand was really what the advantage was.
00:47:05
Speaker
And it was absolutely, entirely, totally unfair. there's There's no other way to put it. And i actually think I quit the game shortly after that because I felt like I beat the game at that point. That's that's the ultimate, you beat the MMO.
00:47:21
Speaker
If you get one of your players on the development team, you have beat the MMO. I don't think there's any other way to actually beat an MMO, but that was that was pretty much what I would say.
00:47:33
Speaker
And it it does completely destroy competition because this was a guild that already had a structural...
00:47:44
Speaker
advantage from produce, this was a guild that already had a structural advantage from producing, you give that structural advantage another unfair structural advantage and then the game is basically over.
00:47:59
Speaker
And i actually didn't really use it that much because just the fact that it was created was enough for me to say, I've beat the game, I'm done, i don't need to do this anymore.
00:48:14
Speaker
That's great. And I'll follow on to that, that you talked about um was that, you know, when you won that programmer over, it was, quote, a pure example of regulatory capture.
00:48:27
Speaker
And in the book, you talk about how the FCC in 2017 had a real world example in your view of regulatory capture because they repealed some network neutrality stuff. And the guy was like a Verizon lawyer, I believe.
00:48:39
Speaker
And in our email exchange, you also talked about Elon Musk's Doge being an example of regulatory capture during the second you know Trump administration. And I guess... I guess i I can't help but think about um the consequences beyond the game world, right? This is, again, a crossover parallel thing here that regulatory capture in that sense, when you start being able to mess with the rules of the game of competition in a way no one else can,
00:49:08
Speaker
you kind of set yourself up to be, if you're not already a monopolist, you're kind of like an unbeatable vendor. And in that case, again, you've broken competition. So i don't know if you have any thoughts on regulatory capture, but that was kind of the gist of it.
00:49:22
Speaker
Well, I wrote my master's paper on network neutrality, so I should have some thoughts on it. So effectively what it means is it creates an inefficiency that shouldn't exist, and then someone profits from that inefficiency.
00:49:40
Speaker
So it's using the system to create an inefficiency, and then you place someone in that spot, and they profit from it. That's effectively what regulatory capture is doing.
00:49:52
Speaker
to To we add to that just a little bit, I kind of think of a regulator's job as to be an impartial referee that ensures everybody's following the rules.
00:50:05
Speaker
So what happens when one of the players for one of the teams gets to be the referee? You get a situation where they get to choose who the winner is, and they might just choose that their team wins.
00:50:20
Speaker
And that's effectively what regulatory capture is. And that's basically what my guild did in the game. you it's that You wrote that the secret rich mind crossed the line from capitalism to corruption.
00:50:33
Speaker
And I guess my thought there was that there are illicit mods and cheatware used in World Warcraft, CS2, COD, GTA V, Fortnite. you know And in in a way, your mind was like an embedded illegal mod. And so you manipulated rules of the game again.
00:50:48
Speaker
And I wonder if... I know you quit the game shortly thereafter, but do you feel any guilt or remorse about potentially destroying the game, right? Because at the end of it, you kind of ran it. You did break the game. You did win the game. But the consequence...
00:51:05
Speaker
at least around that same time, coincidentally, if not causality, was that the game basically failed. It's still around. If you go to eternal-lands.com, you can literally go play it today, but there's very little activity in any of the message boards.
00:51:19
Speaker
So I guess my question is, my sense is that you at a minimum contributed to the downfall of the game, partly because the regulator... was asleep at the switch. He let you do what you did. And I'm wondering if that is an unfair representation of the, i hate to do a spoiler alert on your book, the climax of the book, but that was the spoiler alert that I took away.
Breaking the Game Economy
00:51:42
Speaker
It's funny because no one's ever asked me that question before. no No one's ever asked me if I felt bad about it. And I guess everyone just assumes that I didn't, and and I didn't feel bad about it. I was a high school kid and I was exploring the the boundaries of what you could do in a game like this.
00:51:59
Speaker
And I never thought of it as and an illegal part of the game, but I have had people just say, hey, did you realize that that's considered cheating?
00:52:13
Speaker
Which I hadn't thought of either. And I think part of it was when I played the game, i was playing as what I thought this character would do.
00:52:26
Speaker
So when I was making these decisions and I would run it through my head, okay this person is the villain. This is how they've done things up to this point.
00:52:41
Speaker
How would someone in this mindset make that decision? So I never even really thought about it from the perspective of whether I personally feel bad or not, because I always considered it playing a character in the game and I also thought if this is a problem then why isn't the developer fixing it because I had repeatedly said this is exactly what's happening this is how you can fix it and if they ignore that then I'm gonna keep doing whatever I want and
00:53:19
Speaker
I don't care if they don't like it because they have the ability to fix it at any time. And it's really funny because they did eventually fix it, but far too late.
00:53:31
Speaker
it's I went back to the game several years later, and the mine is still there, but none of the production stuff is in it anymore. So they did fix it, but there aren't there aren't many people playing the game anymore, so it doesn't really matter.
00:53:49
Speaker
yeah And you went back and apologized to people, which says to me, at some point, you did feel some kind of remorse, either either i personal, if not for the economic stuff, then for the the personal trauma you may have caused them. So even though you say you'd never felt it, I feel like you did simply because you apologized to many of them. You actually systematically went around and apologized to them.
00:54:11
Speaker
um Only the people who I felt earned an apology. Okay.
00:54:17
Speaker
But But no, i never I never felt bad about the way that I played the game. But I i did at some at some point decide that there were people who weren't having fun.
00:54:31
Speaker
And I should at least apologize them for taking away their fun. I love it. It's such cool. I don't know if you're a hero or a villain. I i don't know where the arc begins or ends, but I think it's just such a cool way you you learn. and You kind of didn't even know where your north star was at first, but you just kind of keep pushing in different directions. like as you say As a kid, like push your boundaries. and you You told them the answer on how to fix things. At that point, it's up to them to either take it and run with it or or watch everything burn in front of them. and Unfortunately, it sounds like it was more of the latter on that side.
00:55:04
Speaker
I do have one more story that I'd like to share that didn't make it into the book. I think you guys might find this really funny.
Monitoring Player Behavior
00:55:11
Speaker
My guild early on, when we first started putting pressure on the market and we had people getting upset about it, some of them actually challenged us to a real battle.
00:55:27
Speaker
meet Meet us and fight with us. And there were areas in the game where you could attack other players. And they said, show up, have a battle. Let's have a real fight because we hate you for lowering prices.
00:55:43
Speaker
And nobody in my guild had any attack and defense skills. We might've been like level 15 or something like that, where all of these other guys were level 35 or 40 or something.
00:55:56
Speaker
And I said, no, I'm not going to do that.
00:56:01
Speaker
And they just kept pushing for it. And I said, OK, fine. We'll show up and we'll fight you.
00:56:09
Speaker
So they go to this place and they're waiting for us to show up. And while they're waiting, I send a private message to a really high level player. He might have been like level 80 or something.
00:56:22
Speaker
And I say, hey, there's going to be a bunch of newbies in this area. Why don't you come attack them? ah so So my guild shows up and we're basically getting massacred because all we're doing is running around avoiding people.
00:56:38
Speaker
And this high level player shows up and kills everyone. He kills everyone. Except you or are you included? Except me because I hid behind a tree, but then he found me.
00:56:50
Speaker
But ah after that, I declared victory. I said, look. we killed all of your players. And they said, that's not fair. That's not fair.
00:57:02
Speaker
Sounds like something rich would do, but I didn't get to put that in the game. i I didn't get to put that story in the book because it wasn't educational. and so It's funny though. You probably should It's funny.
00:57:16
Speaker
I think there's like a cautionary tale for MMOs in general in that if their dev teams are not, are asleep at the switch toward what, their players and guilds are doing because they're going to push to try to break the rules. They're going to try to go push the boundaries of what's legal in the game, permissible.
00:57:31
Speaker
And I think there's a a cautionary tale at a minimum for and MMOs today and and their dev teams about if you if you don't pay close attention to what your players are doing, they will they will break your game in a way you don't want and that will cause your money to go down.
00:57:47
Speaker
And again, I know you say you don't feel remorse or guilt about what happened to Eternal Lands, but And regardless of that, I still feel there's a little bit of ah a kernel of truth to that today that that every dev team should understand about what their players are trying to do in an MMO.
00:58:04
Speaker
I think maybe some of those dev teams should call me and ask what I would do, and maybe I can help them with that.
Persistence of Gaming Themes
00:58:10
Speaker
I would also add, you know, that a lot of these themes still exist today in gaming, right? And we're talking many years ago, right? We still have the concept of clans or guilds, communities, feedback for studios that listen to your players, right? So these things don't change over the years. They just evolve with the time and and how you have to do it. So...
00:58:28
Speaker
We're going to try and wrap things up here. Andrew, I think these stories are phenomenal. And I can't thank you enough for coming on and sharing. And it's such cool stuff. And I feel like the way you talk about it, it's kind of like that the M. Bison quote from Street Fighter. Like, to me, that was just last Tuesday. It just didn't sound like you it was anything to you, but it's so cool. So...
00:58:49
Speaker
First off, thank you so much for coming. I'm going to hand you the mic here in a second to see if there's anything you want to say. You should let us know where to get your book. But also, Louis, thank you so much for help coordinating. I'll let you say something too as well. But Andrew, mic is yours.
00:59:03
Speaker
Yeah, I hope that this convinces people to read my book. Maybe there will be something in there that you like. You can find it on Amazon. It's The Economics of Online Gaming, A Player's Introduction to Economic Thinking.
00:59:18
Speaker
and you can find my website, wagnerroadcm.com. I also have a sub stack and you can connect with me in LinkedIn. I'm happy to talk to anybody who wants to talk about my book.
00:59:33
Speaker
Always excited to hear from people. We'll links to all of your stuff, Andrew. We'll have to sub stack to his website, to his book so you can see it all. Lewis, you want to take us home? Yeah, I mean, i guess, you know, thanks again for having me on, Gray. It's always a pleasure to be with you. i guess um I guess I'll put this back in Andrew really quickly because I meant to ask it earlier, but I'm interested in the connection between joy and gaming. And I guess my question would be,
01:00:00
Speaker
Outro question. What game have you loved the most in your life? And maybe it's Eternal Lands. Maybe it's something you've played since then. What game have you loved the most, had the most fun, pleasure, enjoyment, accomplishment, whatever it may be?
01:00:11
Speaker
And why? What about that game gave you that feeling? Probably Diablo 2. And it's for the same reason as anybody plays an MMO.
01:00:22
Speaker
That just happened to be I was the right age to play that game a lot. I had friends who played it. I could play that game with my friends. Diablo 2 would probably be the one that had the most the most fun for me anyway.
01:00:38
Speaker
Very cool. I always like to hear that. Yeah, I went crazy for Uncharted 3 back in like 2015. I played that thing, or 2014. I played that endlessly until I got my kill-death ratio up to like 3 or 4 to 1. I was determined. I sucked early on.
01:00:51
Speaker
I spent inordinate hours when I was a younger man. Yeah. Again, a huge thanks to Andrew and Lewis for being a part of today's episode. I found it so cool how real world economics plays with in-game economics and what you can learn by observing both.
01:01:05
Speaker
It's super cool. And again, we'll have all the links to Andrew's as well as Lewis's stuff on PlayerDriven. If you haven't subscribed yet, please subscribe as well as share it with someone you might think gets some information out of it.
01:01:17
Speaker
And look we're looking forward to seeing you in the next episode of PlayerDriven. So peace out.