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I want to study the economy of an online game. In specific I want to examine if there is a possibility to create a prediction model. I would try to describe the whole concept and I am asking for papers or models that could fit in my occasion. I have made a research for papers, but I haven't found anything.

Users have many different ways for incomes. Daily free money, selling, quests etc. A user can create items like potions and then sell them to other users through an auction.

Items don't have a standard price and users define the price by biding on it. Also, items have a few properties of healing etc.

I want to create a model to predict if the price of items will increase or decrease due to other changes in the game. For example, if I increase the daily free money to users, I will put more money on the economy and want to see if the prices will change somehow. Or if I will change the properties of the item how this would affect the whole economy.

I have plenty of real historic data to use, but I haven't found anything related with this.

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  • $\begingroup$ Global vector autoregression models deal with similar (but real world) applications. $\endgroup$ – mzuba Jul 14 '14 at 13:49
  • $\begingroup$ I'd say find a model of an economy with no banking system and build off of that. Out of curiosity, would you mind saying what game? Not a problem if you don't want to share, just wondering. $\endgroup$ – shadowtalker Jul 14 '14 at 15:08
  • $\begingroup$ Unfortunately, I cannot share the game since it is in closed beta version. I will read about GVA models. If anyone else has something to suggest. $\endgroup$ – Sfinos Jul 14 '14 at 15:14
  • $\begingroup$ Take a look at Edward Castranova's work on the economics of video games. If I remember correctly, he discusses the effects of expanding the money supply on prices. $\endgroup$ – Dimitriy V. Masterov Jul 14 '14 at 16:16

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