On World of Warcraft's Elune server, two players recently bought out the entire contents of the Auction House in Ironforge, with the exception of premium-priced high-level weapons and armor (e.g., they bought all the trade goods) and then resold all of what they bought at a higher price. Which, for the most part, people were willing to pay. The same players have also been running an informal storage service designed to underprice the Ironforge bank, but with a bite to it: if you don't pay the storage fee on a weekly basis, they auction off all the goods you've stored with them.
The ensuing discussion interests me partly because it conforms to the picture I sketched out in my "Rubicite Breastplate" article of a sociocultural divide between players that manifests in contests over the purpose and nature of a MMOG economy. Some Elune players protest that this kind of profiteering is unfair, that it interferes with the "moral economy" of play; others admire the ways in which the entrepreneurs are maximizing their utility within the game economy in a particularly systematic and productive manner. One more data point to add to the overall picture.
But I'm also curious about what this says about World of Warcraft's economy, and whether the overall picture is now clear enough to begin giving a systematic account about the particular character of WoW in this respect. There are obvious entrepreneurial responses to the buying out of the auction house: hold onto trade goods, wait for the would-be monopolists to reprice trade goods and put them back up, and then marginally undersell that new price. This is pretty much already the dynamic for trade good sales on most WoW servers.
What does it say about trade skills themselves however that there is such enormous flexibility in the prices of trade goods, that they can take a huge leap in price without seeing any fall-off in demand? If you take leather, for example, it's not as if most leather items are actually commonly for sale at high profit margins on most Auction Houses. I've been able to consistently sell only a small margin of the high-end items available to me as a tribal leatherworker, never enough that it would justify paying for leather at typical Auction House prices. The only reason to buy leather is to skill up--but it's not clear why people want to skill up given the relatively thin pickings in terms of marketable goods. Yet it is easy to sell leather at relatively high prices on most Auction Houses--if I sell rugged leather at the lowest buyout price set by any other seller, I can move as much as I have to sell almost any time I have it available.
But the tradeskill economy is highly uneven. In other areas, there is continuous demand. Guilds that are raiding Molten Core or Onyxia's Lair have an enormous need for fire-resist potions; many other potions are also in regular demand. Enchanters do a fairly steady business. Blacksmiths have a few items that are in persistent demand, as do engineers.
So the Great Auction House Buyout of April 2005 on Elune is interesting in its own right--but maybe it's also a good occasion to begin to systematically describe or sketch World of Warcraft's economy as a whole. What works? What doesn't? What's surprising, if anything?
