China: Gold Basket of the World

Virtual gold production is a huge industry

Pure gold bar
Olegvolk

As a newly minted WoW-head (that's World of Warcraft for you noobs), I've always wondered just how all those "gold farmers" who try to sell virtual gold within in the game came by their vast, ill-gotten riches. I'd heard rumors of sweatshops in China where people are forced to drink Mountain Dew and kill Fel Orcs for 16 hours straight, but that sounded too strange to be true -- and, at the same time, not too different from the average college dormitory.

But according to a new paper by Richard Heeks at the University of Manchester, my imagination wasn't too far off. Online gold farming is big business; by some estimates, gold farming is a $1.4 billion industry that may employee up to one million people. Gold farms in Mexico, Russia, Eastern Europe, and most importantly China, which has about 85 percent of the market, have developed into sophisticated operations, with specialized characters, and employee/players, some tasked with playing the game to farm or collect virtual gold and goods, some specializing in advertising and hawking the goods online, and some devoted to "powerleveling": jumping a customer's character up levels quickly for a fee. On the back end, some employees are part of research and development teams, figuring out ways to earn gold more quickly and efficiently, and even designing bots or hacks to automate the process.

As online gaming grows at an incredible rate of 80 percent per year, and the popularity of WoW, Everquest, Runescape, Final Fantasy, and dozens of other MMORPG skyrockets, gold farming is set to become an even bigger economic force in developing countries. Heeks paper is the first attempt to synthesize what we know about the underground online gaming economy, which he doesn't see slowing up anytime soon. In fact, with gold farming we are just dipping our toe in the economic waters that virtual worlds may bring in the future. "Gold farming is an early example of online employment -- what we might otherwise call "cyber-work" -- in developing countries," writes Heeks. "And it is the first example of what will be a much larger set of economic activity in future; not just given the 80 percent per annum increases in global online games, but as people spend more and more of their time interacting in cyberspace generally and in virtual worlds specifically." In other words, the Fel Orcs aren't going to get a break any time soon.