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The determinants of monetary value of virtual goods: An empirical study for a cross-section of MMORPGs

Author

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  • Qiu-Hong Wang

    (School of Management, Huazhong University of Science & Technology)

  • Viktor Mayer-Schönberger

    (Oxford Internet Institute, University of Oxford)

  • Xue Yang

    (School of Management(Business), Nanjing University)

Abstract

This study investigates the monetary value of virtual goods in the context of 24 most popular massively multiplayer online role-playing games (MMORPGs). Building on classic economic theory, we approach this issue through a combination of experimentation and cross-sectional time series data analysis. Our findings suggest that more intensive social networking and flatter social hierarchical structures are associated with lower monetary value of virtual goods across various MMORPGs. Instead, a larger base of active users increases the potential demand and thus the monetary value of virtual goods in the short run. A steeper social hierarchical structure further strengthens the effect. The implication is that social networking and hierarchical structure can be two effective angles for game developers or policy makers to address the issue of real-money trading of virtual goods.

Suggested Citation

  • Qiu-Hong Wang & Viktor Mayer-Schönberger & Xue Yang, 2013. "The determinants of monetary value of virtual goods: An empirical study for a cross-section of MMORPGs," Information Systems Frontiers, Springer, vol. 15(3), pages 481-495, July.
    • Handle: RePEc:spr:infosf:v:15:y:2013:i:3:d:10.1007_s10796-011-9339-4
    DOI: 10.1007/s10796-011-9339-4
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    References listed on IDEAS

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    1. Edward Castronova, "undated". "Virtual Worlds: A First-Hand Account of Market and Society on the Cyberian Frontier," Gruter Institute Working Papers on Law, Economics, and Evolutionary Biology 2-1-1008, Berkeley Electronic Press.
    2. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
    3. Edward Castronova, 2001. "Virtual Worlds: A First-Hand Account of Market and Society on the Cyberian Frontier," CESifo Working Paper Series 618, CESifo.
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    Cited by:

    1. Young Bin Kim & Sang Hyeok Lee & Shin Jin Kang & Myung Jin Choi & Jung Lee & Chang Hun Kim, 2015. "Virtual World Currency Value Fluctuation Prediction System Based on User Sentiment Analysis," PLOS ONE, Public Library of Science, vol. 10(8), pages 1-18, August.
    2. Yulei Gavin Zhang & Mandy Yan Dang & Hsinchun Chen, 2020. "An Explorative Study on the Virtual World: Investigating the Avatar Gender and Avatar Age Differences in their Social Interactions for Help-Seeking," Information Systems Frontiers, Springer, vol. 22(4), pages 911-925, August.
    3. Jongchang Ahn & Kyungran Ma & Ook Lee & Suaini Sura, 0. "Do big data support TV viewing rate forecasting? A case study of a Korean TV drama," Information Systems Frontiers, Springer, vol. 0, pages 1-10.
    4. E. Mitchell Church & Richelle L. Oakley, 2018. "Etsy and the long-tail: how microenterprises use hyper-differentiation in online handicraft marketplaces," Electronic Commerce Research, Springer, vol. 18(4), pages 883-898, December.
    5. Jongchang Ahn & Kyungran Ma & Ook Lee & Suaini Sura, 2017. "Do big data support TV viewing rate forecasting? A case study of a Korean TV drama," Information Systems Frontiers, Springer, vol. 19(2), pages 411-420, April.

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