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Can You Learn About Economics From Video Games?

An in-depth analysis of virtual economies within video games and how video games can teach you about economics through Team Fortress 2 and Old School RuneScape.

Zachary Levin, Blogger

October 23, 2020

19 Min Read

Can You Learn About Economics From Video Games?

Economics is a very complex field that affects millions of individuals, companies, and corporations daily. Many people have devoted their lives to understanding how their country’s economy works, as well as who to invest in. Systems like Dow Jones, NASDAQ, and the New York Stock Exchange (NYSE) act as integral parts of the United States economy. The NYSE dictates the worth of a company in “shares” or stocks. A major company such as Microsoft has stocks worth over a few hundred USD, but much smaller companies may have stocks worth nothing. There are people whose jobs are to analyze patterns and trends in the stock market every day. For some people, it isn’t financially worth it to enter the stock market, and others may not be interested in taking a class on Economics 101. However, I firmly believe video games can teach you simple economics, despite not seeming like the medium to do so. Two great games that can teach players about economics are Team Fortress 2 and RuneScape. 


Figure 1.1. Team Fortress 2’s logo.


Figure 1.2. RuneScape’s logo.


Team Fortress 2

Team Fortress 2 (TF2) is a multiplayer first-person shooter developed by Valve and released in October 2007 for PC, then later to home consoles via the Orange Box collection. It has received several updates over the past 13 years, with major updates adding an item trade system, cosmetics, a shop, and making the game free-to-play. Team Fortress 2’s “core gameplay” involves various game modes such as Capture Point where the attacking Blue team must capture a number of control points under a time limit, with captured points awarding Blue team additional time. Meanwhile, the defending Red team must prevent the Blue team from capturing all of the points. I use the words “core gameplay” because TF2 also has a very active trading community, and to some people, that is what the game is all about nowadays.  


In TF2, players can receive items occasionally through a drop system that awards weapons and crates (commonly) and cosmetics and hats (rarely). Cosmetics offer no advantages, but can be used to play dress-up with each of the different classes you can play as in the game. If a player has duplicate weapons, they can combine two of them to craft scrap metal. Combining three scrap metal creates one reclaimed metal, and combining three reclaimed metal to create one refined metal. Players can also combine three refined metal to craft a random cosmetic. 


Refined metal is considered one of the primary forms of currency in TF2’s trading community. Another primary form of currency is a Crate Key. Keys typically hover around a value of $2.50, and are worth many refined metal. Currently, one key is worth about 46 refined.  Keys are the only way to open up the common crates that players can receive from item drops. Crates usually drop common items or rare cosmetics, but have a 1% chance of dropping an Unusual Hat. Unusuals are the last primary form of currency, and due to the wide variety of cosmetics and effects, they vary in value. Very cheap or undesirable unusuals usually are worth around 20$ (see Figure 2.1), but extremely rare and sought-after unusuals are worth hundreds, sometimes thousands of dollars (see Figure 2.2). The rarest and most valuable unusual in the history of TF2 is the illusive Burning Flames Team Captain, sold for ~$14,000 in 2017 (see Figures 2.3 & 2.4). 

Figure 2.1. Various low tier unusuals and their prices.


Figure 2.2. Various high tier unusuals and their prices.


Figure 2.3. The ~$14,000 Burning Flames Team Captain Unusual.

Figure 2.4. Exact value of the Burning Flames Team Captain Unusual bought in 2017.


Since TF2 has an item trade system, a lot of transactions made in the community are primarily through bartering. Free-to-play players normally have 15-day wait times on TF2 item trades, but upgrading to a permanent premium account requires players to spend money in the in-game shop. However, you can simply buy the cheapest item in the in-game shop (priced at $0.99 USD) and upgrade your account that way. Although players can trade several items at once through a universal trade system available by the game’s platform, Steam, TF2 used to only allow players to trade up to 10 items at once. To make trading easier, the community determined the values of refined metal, keys, and unusuals. As mentioned above, keys are worth a certain amount of refined, and unusuals are worth a certain amount of keys. It’s like if refined metal were pennies, keys were quarters, and unusuals were dollar bills. Unusuals that required a ton of keys were almost never paid with refined metal, as it would be far too tedious. Alternatively, you could trade a few cheaper unusuals for one expensive unusual. Lastly, active traders would tend to hold onto more valuable items in hopes that it would gain more value over time, and as the game received more updates and items included in these updates, the economy expanded. You may be wondering how you would be able to cash out. TF2 normally does not have a way that lets you sell your items to receive real-world money, and most players did not have an easy way to sell valuable items until Steam launched the community market in December 2012.  


In December 2012, Steam launched their Steam market (short for Steam community market) where users can sell valuable items for a digital currency known as Steam Wallet (see Figure 2.5). The Steam Wallet can be used to buy games on the Steam platform and the Steam market, and acts identical to a debit card where you can add funds to it and spend later. The Steam market isn’t limited to TF2 items either. Other popular games with similar item systems on Steam like Counter Strike: Global Offensive and Dota 2 can provide players with a way to buy and sell their rare items. However, there are fees and taxes that take a cut of the profit gained when selling an item. 


Figure 2.5. Different kinds of TF2 items listed on the Steam market.


All items sold on the Steam market have a 5% fee that is deducted from the profit gain for the seller. For TF2 items, there is an additional 10% tax for items being sold. These taxes are automatically deducted from how much the seller makes from their item being sold. Sellers and buyers alike can view recent data of how much and how many of an item were sold to view trends and either sell a bit higher or buy a bit cheaper (see Figures 2.6 & 2.7). For extremely valuable items like high tier unusuals, this can cut off a notable amount of your profit. Thankfully, there are sites that allow dedicated traders to set up specific buy and sell offers for items such as through Backpack.tf and Marketplace.tf.


Figure 2.6. TF2’s crate key’s Steam market listing. Note that the key’s market price in this figure is different from figure 2.5, as prices shift frequently.

Figure 2.7. TF2’s median Crate Key sales over the past month (top graph), as well as all buy and sell orders for the item overall. 


Backpack.tf is a community site that allows dedicated traders to do trading, check pricing, and view statistics on a much more in-depth level than what is possible through the Steam market or TF2’s item trade system. Every day, there are hundreds of transactions made as well as pricing suggestions for certain items (see Figure 2.8). A typical pricing suggestion usually includes recent data of how much an item was bought or sold at on various trading sites, the current price of the item, and a new proposed price. There are also votes and comments for each price suggestion. Backpack.tf also allows users to view the inventory value of other users. This is sometimes used to determine the credibility of a trader as wealthier traders tend to be more reputable. The majority of trades done through Backpack.tf use refined metal, crate keys, and another form of currency known as “earbuds” which are worth a few keys by themselves. Backpack.tf is one of the main trade sites where traders may choose to wait longer on selling their items for greater profit than potentially quicker but less profit through the Steam market. For those interested in purchasing items with real world money (similar to steam wallet but through actual currency) at a cheaper cost than Steam market prices, Marketplace.tf is the perfect site for that.


Figure 2.8. A recent price suggestion for an item. The price suggestion contains a voting system, comments, explanation for the price suggestion, the item itself, the suggester, the date of the price suggestion, and how many items the user had at the time of making the price suggestion.


Marketplace.tf is a website created by the community that can be used to securely purchase items at lower costs thanks to the site mitigating the 15% tax implemented by the Steam market, and having only a 5% tax (see Figure 2.9). While trading is not exactly on Marketplace.tf, this allows for common currency items like keys to cost less than 2$ USD when the Steam market lists them as ~$2.30 USD (see Figures 2.10 & 2.6). Users can also participate in auctions. However, at the time of this blog post, Marketplace.tf is shutting down its seller program over the course of the next few months, and auctions can no longer be created. There are many other trading sites such as Trade.tf, but traders have plenty of choice when it comes to how they want to approach trading and bartering their items.

Figure 2.9. Marketplace.tf’s home page.


Figure 2.10. Marketplace.tf’s key price. Keys cost much less compared here (about 50 cents) to the Steam market since there is less tax.  


I want to mention one last thing about Team Fortress 2 that makes it really feel like you can learn about economics from video games. In August 2019, there was a community “event” that took place that severely affected the economy of TF2. I use quotations for “event” because unlike updates which add new content to the game and are considered a positive, this event decimated the value of unusual cosmetics. Earlier, I mentioned that crates typically have a 1% chance of providing an unusual item. There was a crate exploit found that bumped this chance to 100%, and for the next 24 hours, while the developers were hastily working to fix this bug, thousands of people unboxed as many crates as they could to get as many unusuals as possible. This short period of time was nicknamed “The Crate Depression of 2019” (see Figure 2.11). This is the equivalent of a market crash, hence the name. The developers decided to make the first unboxed unusual in every person’s inventory that participated in this unboxing event tradable and able to be sold on the Steam market. Other unusuals, however, were deemed untradable and unable to be sold on the Steam Market. Many rare unusuals lost a lot of value. While this seems like it would be enough to kill a game’s community, Team Fortress 2 has seen a resurgence of players since quarantine started with numbers it hasn’t had since the last major update in 2017, Jungle Inferno, or the addition of the Mann vs Machine game mode in 2012.

Editor's note: I stated that the developers made the first unusual unboxed untradable, and the remaining unusuals unboxed tradable. This was a mistake, and I have corrected this error. The first unusual was made tradable, and the rest were made untradable.

Figure 2.11. TF2’s Developer Team blog post on The Crate Depression of 2019. To view the full post, click here. 


Team Fortress 2 is one of Valve’s greatest accomplishments and considered a timeless masterpiece by many. While some may remember TF2 for its active trading community rather than its gameplay, it has stood the test of the time and continues to be played by thousands of people every day, despite being released over a decade ago. One thing is for sure, though, and that is that TF2 is a great video game to teach you about economics. 




Figure 3.1. Old School RuneScape’s logo.


RuneScape is an old medieval-themed MMORPG developed and released by Jagex in 2001. RuneScape has gone through many different iterations during its lifecycle, such as RuneScape Classic (2001-2006, shut down in 2018), RuneScape 2 (2006-2013), RuneScape 3 (2013-present), and Old School RuneScape (2015-present, based on a version of RuneScape from 2007). The most played versions currently are OSRS (short for Old School RuneScape) and RS3 (RuneScape 3). Anyone can play RuneScape for free, although players are limited in what they can do. All versions of RuneScape have/had memberships available to players who wish to explore the rest of what the game has to offer and have a greater player experience. Personally, I have the most experience with OSRS, so I will be focusing on this game from now on unless stated otherwise.    


OSRS has a surprisingly active economy like TF2, and its own form of currency to facilitate trades between players. This currency is known as gold pieces, or GP. GP is the game’s standard currency, used in both trading and buying gear in equipment shops, as well as other transactions. Unlike TF2, GP is not a form of currency that was chosen by the community. Since GP was present since the launch of RuneScape, it makes the most sense to use it. However, this doesn’t mean that OSRS is exempt from trading issues.


OSRS’ greatest weakness in both a gameplay and economy perspective is rampant botting problems. In OSRS, bots are made by “botters” who create accounts that are run using 3rd party scripts to do certain tasks at maximum, inhuman efficiency. Botting is against OSRS rules and is a bannable offense. Jagex is very proactive when it comes to banning bots, but people are creating newer and smarter bot programs every day. Every day, there are hundreds of bots, most notably in the free-to-play worlds, grinding specific tasks, either to make tons of GP, or to level up certain skills so more profitable options are available. Bots typically have names that are a mess of letters and numbers, have very basic appearances (usually bald with no beard, green pants, and an olive-colored top) (see Figure 3.2), and have robotic set paths when it comes to doing different things. Some 3rd party clients allow users to look up stats of other players, but these stat tables are updated every so often. If an account comes up as an error upon lookup, it usually means it is a bot. Money making bots also may have irregularly high levels for certain stats, typically ones that are more lucrative. YouTubers such as SirPugger and Colonello document new and notable botting areas often, and are great OSRS channels overall. 


Figure 3.2. Various players in Lumbridge, the first area of OSRS. Note the bot on the right, with the very basic appearance.


Although bots are frequently banned, they usually last long enough that the botters can make millions of GP from these bots. Once the bot makes enough GP/loot (the loot can be sold for money) for the botter, the bot will trade with the botter’s main account. After this, the main account will deposit the traded money/loot in their personal bank. All players can deposit their items and GP into their personal bank for safekeeping, but botters can make millions from their bots, and even if the bot account is banned, the botter can make a new one in a few minutes. Botters may even sell the GP they made from their bots on shady OSRS black market sites where players can buy gold pieces in exchange for real-world money. The reason why this is so shady is because real-world trading is banned in OSRS, and your credit card info can be stolen if you use these sites.      


In order to combat real-world GP trading, Jagex introduced a trading hub in RuneScape 2 in 2007 called the “Grand Exchange/GE” (see Figure 3.3). OSRS and RS3 also have the GE present and is a central location for any player, regardless if they are a free-to-play player, or a member. Players can set up sell and buy offers for any item they want using GP. This is vital for any player, as it allows any player to order items they need that they may not be able to easily get at the moment, or sell items to make GP. Some 3rd party RuneScape clients such as RuneLite have GE features such as being able to lookup the cost of any item in the GE without needing to be present at the GE, as well as keeping track of your buy and sell offers, even when the game isn’t open. 


Figure 3.3. Dozens, if not hundreds of people standing in front of the Grand Exchange. Although it seems like only a few dozen are present, players can stand directly on top of others on one spot, so there are many players hidden from view.

Players can also purchase “bonds” using GP at the GE instead of paying with real-world money. One bond can be redeemed for 2 weeks of membership, but cannot be traded back to the GE for profit. A bond usually costs around five to six million GP in the GE (see Figure 3.4), but stays static at $6.99 USD on the official RuneScape site (see Figure 3.5). Free-to-play players will have a much harder time grinding up GP to purchase a bond, as money making methods are very limited for them. Members have many more ways to make money, as well as more lucrative options, too. It is generally easier for members to maintain their membership through GP money making methods alone, especially when they are high-leveled enough to do more profitable methods. Purchasing a bond from the GE as a free-to-play player is considered celebratory for many people, as the grind usually lasts hundreds of hours for lower-level players. Wealthier and invested players, however, may opt to do something known as “flipping.”


Figure 3.4. The cost of a bond in GP at the Grand Exchange.


Figure 3.5. The cost of a bond and more information on what bonds do. RuneCoins and Keys are exclusive to RuneScape 3.


In RuneScape, “flipping” is a term used to describe the process where a player purchases a large quantity of items in bulk and sells them back for a small profit. While anyone can technically “flip”, wealthier players are able to take greater advantage of this, as they are able to buy more expensive items in bulk and make greater returns. Unlike the Steam community market, there is no tax when it comes to selling items, so players don’t have to worry about only getting a cut of their profits. The whole “flipping” process can be likened to the stock market - buying low, selling high. “Flippers” can exploit the automation of bots (since some bots use the GE to obtain items needed for quests or fast leveling up) to sell very high since bots may purchase items much higher than the GE average to receive them very quickly. This is not guaranteed to work on bots but with desirable items, it can happen. A good YouTube channel to check out for more information on this “flipping” is FlippingOldSchool, who frequently uploads other OSRS videos frequently as well. 



Overall, I feel like Team Fortress 2 and Old School RuneScape are two great examples of video games that can teach people about economics. Due to the environment the games are held within, players do not have to worry about huge potential losses, needing (considerable) dispensable income to get into the economic aspects of the game, or having to take a course to learn how their economies work. In fact, since both games are free to play by default, the initial money investment is next to none. The TF2 and OSRS communities are very active to this day, despite games being considered as old. TF2 hit its all-time peak in early October, with 130,000 players online at one point. OSRS hit its all-time peak in April of this year, with over 156,000 players online across the PC and mobile versions of the game. Personally, I’ve enjoyed my times in both of these communities, even if the games are a bit old, and I’m happy that these games are receiving updates more than ever now. I hope my post has piqued your interest in either of these games, whether it be for the economic aspects of either game, or the actual gameplay of them. Thank you for reading my post.

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