The Economic Meaning of Games and Play: Ludology and Praxeology in Video Game Worlds

Research output: Chapter in Book/Report/Conference proceedingChapter


This chapter explores the economic meaning of video games and virtual worlds. Section 2 outlines the scope of video game economics and several different types of research included under this umbrella term. Section 3 then explores one of these types in more detail by examining the relationships between action, choice, and economics on the one hand and games and play on the other. Section 4 builds on this insight by exploring the economics of gameplay, especially how the structure of video games implies a series of economic problems that players solve: scarcity, choice and tradeoffs, opportunity cost, specialization and division of labor, trade, and entrepreneurship. Section 5 then discusses virtual worlds and their relation to real-world economies. Section 6 concludes with some thoughts on the purpose, value, and limitations of video game economics.
Original languageEnglish
Title of host publicationThe Invisible Hand in Virtual Worlds
Subtitle of host publicationThe Economic Order of Video Games
Place of PublicationCambridge
PublisherCambridge University Press
Number of pages27
ISBN (Electronic)9781108884891
ISBN (Print)9781108839716
Publication statusPublished - 3 Feb 2021


  • Praxeology
  • ludology
  • video games
  • virtual worlds
  • scarcity
  • choice
  • tradeoffs
  • opportunity costs
  • specialization
  • division of labor
  • trade
  • entrepreneurship


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