There's been a lot of talk lately about virtual items getting taxed in the real world. One definition of tax is "a burdensome charge, obligation, duty, or demand". Something that we as citizens of the real world tend to forget (at least I do) is that the reason behind taxation is actually a noble one: to do useful things for the public. I know that we don't always feel that it's efficient or even done properly in the real world, but ultimately we tolerate it because the world is a better place because of what we as citizens are able to accomplish collectively through the use of taxes. I can't help but wonder if the same might be true within the virtual world, and perhaps we just don't realize it yet.
As gamers we are already being taxed in the virtual world but it's done by another name: Item Decay. Many games implement this design strategy as a means to penalize failure and to add some economic drain to the game. It is, in effect, a death tax when your character dies and your gear depreciates due to this unavoidable charge that reduces the value of the affected items. While this can be a burden, it's something most people accept as the cost of failure to play well. If they don't accept it, well, they don't play games that have it.
Ok so that's not really news except for the parallel I'm making between taxation and unavoidable game penalties. Perhaps it's even a stretch but it does seem to fit the definition of a virtual tax. I have been reading various articles lately about MMO farmers and I am reminded of a strategy for reducing the impact farmers can have on the virtual economy. It's likely to be controversial but I would like to see how it plays out in a game someday - make in game banks charge the players to hold stuff for them as opposed to just getting free storage of limitless quantity of cash and items. I'd never suggest applying this mechanic to an existing game world, but if a new game were to come along and implement this idea it would certainly be an interesting experiment to see how it would affect farmers.
If money and items slowly decayed at a rate roughly related to how much stuff the player had, this would seem to have the effect of penalizing the players who have for all practical purposes "farmed to excess". Carefully tuned, a proportional scaling decay system might have the effect of neutralizing the ability of farmers to accumulate so much virtual material wealth that they can then monetize their sweatshop efforts. In other words, the more stuff someone has, the faster their stuff decays. A properly tuned system would have these non-linear decay curves configured so that a "normal" player, as seen by the designers and certainly subject to player feedback, would not see any more decay than they do today, and in fact the players who don't invest a lot of time in the game would perhaps enjoy the game a bit more because their stuff wouldn't decay much at all because these players usually don't have much to "tax". On the other end of the spectrum, farmers and exploiters who accumulate orders of magnitudes more possessions in game would be increasingly penalized. Otherwise known as taxed. This is, in effect, a sliding tax system used by real world income tax today. Or so it seems to me, but I am certainly no economist. Regardless, the farmers would face an increasingly difficult task as they accumulated more wealth, reducing their overall impact to the MMO community. It would become an exponentially difficult task to reach the levels of virtual wealth required for farming to be profitable.
In other words, it would bring the exponential difficulty curve present in so many other MMO game systems to the economic aspect of the game.
A sliding penalty system would be more flexible and tunable than hard caps on currency or items, and is I think compatible with many existing decay systems in use today. I wonder if this is something people would be willing to try someday; I think it has the potential to reduce the farming problem in MMOs, as well as improve the quality of the game for players who don't spend a lot of time in game. It would have to be done carefully however; the "average to serious" player should not feel the impact of this system - it's the farmers and exploiters that are the target. They have so many orders of magnitude more game wealth than people who "play normally" that it should be possible to tune the system to protect the regular players from the burden of item decay. If such a system were able protect players from having to deal with an environment soiled by gold farmers, perhaps it would be worth doing. I think it's probably worth trying someday and see how well it works.