Truck, Barter and Exchange Versus the Endowment Effect: Virtual Field Experiments in an Online Game Environment
25 Pages Posted: 13 Jan 2008
Date Written: January 2008
We examine the feasibility of using a massively multiplayer online role-playing game (MMORPG) to test economic theories. As a test vehicle we use the well-known hypothesis about the relationship between market experience and the endowment effect. Our results confirm earlier field experiments that individuals with more trading experience are less likely to exhibit status quo behaviour in trade. However, we also find evidence that highly experienced individuals are more likely to swap the item rather than keep it - i.e. there appears to be a propensity to 'truck, barter and exchange'. A further experiment suggests that this feature is robust and is unlikely to be due to subject misperception or experimenter demand effects. We conclude that virtual economies may be a useful venue for field experiments.
Keywords: endowment effect, virtual field experiment, Runescape, MMORPG
JEL Classification: C93, D11
Suggested Citation: Suggested Citation