Fall of Duty: Video Games vs. The Labor Market

As technology has advanced, we have seen the effect it can have on labor demand, especially for lower-skilled workers. Erik Hurst, an economist at the University of Chicago, decided to look at how technological change influenced the other side of the market, or labor supply. Hurst, along with his co-authors Aguiar, Bils, and Charles released a working paper called .Leisure Luxuries and the Labor Supply of Young Men examining the impact of video games and other recreational computer activities on the willingness of young men to act as labor suppliers. A Theory of Individual Labor Supply One way which economists have looked at Continue reading Fall of Duty: Video Games vs. The Labor Market

Dependency on Sponsorship: Professional Gaming

Video games have been around since the 1950s when the “cathode-ray tube amusement device” was first invented. But now video games have taken a new form of entertainment as “professional gaming” has become popular in the last few years. The video game industry has seen much growth, especially over the 21st century, and the industry has realized a total revenue of about $23.5 billion in 2015. Of course, with this type of money flowing into the industry there must be consumers who are dedicated to these products and there are. The reason that the industry has been expanding is because Continue reading Dependency on Sponsorship: Professional Gaming

Release Strategy of Nintendo Switch

I’ve been a Nintendo fan most of my life. I don’t actually remember a time in my life before I had a GameBoy with Pokémon. My favorite video game to this day is Super Smash Bros Melee, a game which feature characters from Nintendo’s most popular franchises, released all the way back in 2001. However, Nintendo’s most recent console, the Wii U, hasn’t done very well compared to higher capacity rivals, the Sony PS4 and the Microsoft Xbox One. This Forbes article talks about Nintendo’s odd release strategy of the New Nintendo Switch, which is due to be out in Continue reading Release Strategy of Nintendo Switch

Thesis Corner: Lorraine Black on Video Games

Below I present an interview I had with our very own Lorraine Black, discussing her highly intriguing senior economic thesis. Let’s dive right in! Okay, first couple questions: what was the topic of your thesis, and why did you pick that? The topic of my senior thesis was the economic behavior of consumers that play free-to-play multiplayer online video games. I picked it because it struck me as pretty irrational behavior in a relatively new industry. Also I like video games. Good a reason as any. What were your findings? I conducted a survey of 300 League of Legends players Continue reading Thesis Corner: Lorraine Black on Video Games

Video Games: Just a Plastic Disk

For all those Xbox, PlayStation, Wii owners out there, have you ever thought about why your video games cost you so much these days? The average game costs about $60 when it is first released and can go to about twice that if it includes bonus material. But if you think about it, the actual game is just a plastic disk. It can’t be that difficult or costly to produce. But you guessed it… individual games for consoles such as Xbox or Playstation actually have huge budgets. In 2014 Activision, a popular video game developer, announced that one of their Continue reading Video Games: Just a Plastic Disk

The Importance of Virtual World Economics

How much would you pay for a virtual spaceship? Ten dollars? One hundred dollars? One thousand dollars? Try $10,000. Yes, for a virtual spaceship. With online gaming on the rise, what can we expect to see from games like World of Warcraft, Eve, and Second Life? Well there are big spenders, like the hot shots that own Titans in the massive interstellar reality Eve, which go for $10,000. Then there are people who have quit their day jobs to pursue a full-time career in acquiring and selling virtual items. What you have is a free market consisting of potions, laser Continue reading The Importance of Virtual World Economics