Just How Large Is the Gold Farming Industry?

The BBC reports on a study of gold farming that concludes the practice may be a $500 million/year industry that contributes a significant amount of activity to developing countries’ economies.

Prof Heeks said very accurate figures for the size of the gold farming sector were hard to come by but his work suggested that in 2008 it employs 400,000 people who earn an average of $145 (£77) per month creating a global market worth about $500m.

But, he said, the true size of the sector was hard to estimate – it could easily be twice as big.

The quasi-criminal nature of gold-farming made it hard to truly gauge its extent, said Prof Heeks.

As Heeks notes, that would put gold farming on par with the entire Indian IT outsourcing industry in 2004. Frankly, that seems a bit on the high side. It could easily be twice as big, but I bet it could easily be half that size.

Interestingly, the BBC also quotes Steven Davis — who works for Secure Play which develops software to stop gold farming and other forms of cheating — noting an interesting take on comparative advantage in the gold farming business,

A hierarchy of gold farmers arranged by where wages were lowest was starting to emerge, said Mr Davis. For instance, the low wages gold farmers in Vietnam will accept means they now do for Chinese gamers what many in China do for those in the West.

“It’s moving down the chain,” he said.

Fascinating. The only game I play where gold farming is a real issue is World of Warcraft, and Blizzard so far seems to have the upper hand over gold selling, in large part because the game world is such an artificial one where it can impose the sort of arbitrary restrictions on transactions that would be easy to evade in the real world.

Leave a Reply