From the Hands of an Early Adopter's Avatar to Virtual Junkyards: Analysis of Virtual Goods' Lifetime Survival

One of the major questions in the study of economics, logistics, and business forecasting is the measurement and prediction of value creation, distribution, and lifetime in the form of goods. In "real" economies, a perfect model for the circulation of goods is impossible. However, virtual realities and economies pose a new frontier for the broad study of economics, since every good and transaction can be accurately tracked. Therefore, models that predict goods' circulation can be tested and confirmed before their introduction to "real life" and other scenarios. The present study is focused on the characteristics of early-stage adopters for virtual goods, and how they predict the lifespan of the goods. We employ machine learning and decision trees as the basis of our prediction models. Results provide evidence that the prediction of the lifespan of virtual objects is possible based just on data from early holders of those objects. Overall, communication and social activity are the main drivers for the effective propagation of virtual goods, and they are the most expected characteristics of early adopters.Comment: 28 page

Inequality and Economic Growth: European Versus U.S. Experiences

This paper discusses long-term trends in the macroeconomic growth performance and in income distribution in Europe and the U.S. We review insights from the recent macroeconomic literature on inequality and growth and use these insights to shed light on the growth and inequality trends

Consuming Bits: An Exploratory Study of User Goals for Virtual Consumption

Virtual consumption, or consumption of virtual goods and property, has become a major economic activity in social virtual worlds such as Second Life. Given that virtual consumption has become an important part of everyday virtual life in social virtual worlds, understanding virtual consumption can be an essential aspect to understanding user behavior in those worlds. Despite its significance, little research has explicitly examined virtual consumption. Unsurprisingly, then, we know very little concerning the fundamental question of why users consume virtual property. The research study described in this paper is an initial examination of that question. For the study, we employed the laddering interview technique and means-end chain analysis, which produces users’ goal structure in reference to a hierarchical system of interrelated goals. 93 participants were interviewed in Second Life for the study. The results show that virtual consumption widely penetrates into virtual life and make virtual experience much richer

Users\u27 understandings of the virtual economy in social virtual worlds: consumption and entrepreneurship of virtual goods

Social virtual worlds (SVWs) such as Second Life have gained immense popularity during the last decade. Their popularity is reflected in the explosive growth of the in-world economy, which is mainly supported by users’ consumption of virtual goods and entrepreneurial behavior. Users’ economic behavior has increased the size of the virtual economy to reach over $1B in the United States in 2009 (Nicholson 2009). Given that virtual consumption and entrepreneurship have become an important part of everyday virtual life in SVWs, understanding these two types of economic activities is an essential aspect to understanding user behavior in SVWs. This research aims at investigating the meanings of virtual consumption and entrepreneurship for users. The research consists of two independent essays. In the first essay about virtual consumption, I examine users’ understandings of virtual consumption through core-periphery analysis of its social representation. 154 Second Life users participated in the web-based survey for this study. I also identify user goals for virtual consumption by using means-end chain analysis, based on interviews with 93 Second Life users. The second essay on the topic of virtual entrepreneurship examines the collective meanings of virtual entrepreneurship and their relationship with the collective meanings of SVWs. To understand the meanings of virtual entrepreneurship, the core-periphery structure of social representations of virtual entrepreneurship is analyzed, based on interviews with 24 Second Life entrepreneurs. The meanings of virtual entrepreneurship are explained and compared with the central meanings of SVWs, identified from 101 newspaper articles on SVWs from 2005 to 2009. The results show that virtual consumption penetrates extensively into the virtual life of users and make their virtual experience in SVWs much richer; that virtual entrepreneurship is institutionalized in SVWs, and the key meanings of SVWs are well translated into the meanings of virtual entrepreneurship. This research contributes in providing fundamental knowledge about virtual consumption and entrepreneurship and further suggests potential theoretical frameworks for future research. Implications for SVW service providers and producers and sellers of virtual goods are also identified. Another contribution of the research is to demonstrate alternative qualitative research approaches combined with quantitative analyses

A Simple and Flexible Alternative to the Stability and Growth Pact Deficit Ceilings. Is it at hand?

There have been widespread criticisms of EMU fiscal institutions. We consider a simple alternative to the deficit ceilings envisaged in the Stability and Growth Pact. We advocate the adoption of deficit targets. National governments should retain discretion in setting deviations from targets, but these deviations should then be reversed following a predetermined rule. This ensures fiscal discipline and leaves room for stabilisation policies. For the rule to be credible, only small changes are required to current EMU institutions. Our scheme performs well in comparison with existing reform proposals and is consistent with the golden rule of deficit financing.

The Price of "Man" and "Woman": A Hedonic Pricing Model of Avatar Attributes in a Synthetic World

This paper explores a unique new source of social valuation: a market for bodies. The internet hosts a number of large synthetic worlds which users can visit by piloting a computer-generated body, known as an avatar. Avatars can have an asset value, in that users can spend time to increase their skills; these asset values can be directly observed in online markets. Auction data for avatars from the synthetic fantasy world of EverQuest are used here to explore a number of questions, especially those involving the relative value of male and female avatars. In EverQuest, about 20 percent of the avatar population is female, and there are no sex-based differences in avatar capabilities. Many avatars (about one-fourth to one-fifth of the population) are cross-gendered, being piloted by a person of the opposite sex. Nonetheless, relations between avatars are gender-based, and include chivalry, dating, and sex. Female avatars tend to be concentrated in highly sexualized Human and Elven races, with very few being present among such aesthetically-challenged races as Ogres and Trolls. Hedonic analysis of the auction price data suggests that gender labels are a less important determinant of avatar values than the ‘level,’ a game-design metric that indicates the overall capabilities of the avatar. Thus, ability seems more important than sex in determining the value of a body. Nonetheless, among comparable avatars, females do sell at a significant price discount. The average avatar price is 333 dollar; the price discount for females is 40 to 55 dollar, depending on methods. The discount may stem from a number of causes, including discrimination in Earth society, the maleness of the EverQuest player base, or differences in well-being related to male and female courtship roles. We do know, however, that these differences cannot be caused by sex-based differences in the abilities of the body, since in the fantasy world of Norrath, there are none.synthetic worlds, internet auctions avatar attributes, sexual discrimination

E-commerce transactions in a virtual environment: Virtual transactions

E-commerce is a fundamental method of doing business, such that for a firm to say it is trading at all in the modern market-place it must have some element of on-line presence. Coupled with this is the explosion of the "population" of Massively Multiplayer On-line Role Playing Games and other shared virtual environments. Many suggest this will lead to a further dimension of commerce: virtual commerce. We discuss here the issues, current roadblocks and present state of an e-commerce transaction carried out completely within a virtual environment; a virtual transaction. Although technically such transactions are in a sense trivial, they raise many other issues in complex ways thus making V-transactions a highly interesting cross-disciplinary issue. We also discuss the social, ethical and regulatory implications for the virtual communities in these environments of such v-transactions, how their implementation affects the nature and management of a virtual environment, and how they represent a fundamental merging of the real and virtual worlds for the purpose of commerce. We highlight the minimal set of features a v-transaction capable virtual environment requires and suggest a model of how in the medium term they could be carried out via a methodology we call click-through, and that the developers of such environments will need to take on the multi-modal behavior of their users, as well as elements of the economic and political sciences in order to fully realize the commercial potential of the v-transaction. © 2012 Springer Science+Business Media, LLC

An Essay on Welfare State Dynamics

The expansion of welfare-state arrangements is seen as the result of dynamic interaction between market behaviour and political behaviour, often with considerable time lags, sometimes generating either virtuous or vicious circles. Such interaction may also involve induced (endogenous) changes in social norms and political preferences. Moreover, the internationalisation process not only limits the ability of national governments to redistribute income; they also increase the political demands for international mobility of welfare-state benefits and social services. I also discuss the dynamics of reforms and retreats of welfare-state arrangements.welfare state, welfare-state dynamics, political equilibrium, social norms