Player-run economy
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In massively multiplayer online role-playing games (MMORPGs), a player-run economy is a feature where the players control all or part of the game's virtual economy. The alternative has the game designers control the economy through setting the prices, the rates of item creation and destruction, and any number of other factors.
In these games players are dependent on acquiring weaponry, armour and similar equipment to be able to complete their tasks, which often involve killing enemies. The most common way this is implemented is that the player takes items from the dead enemy (called loot), sells it at a computer-controlled store, and uses this earned cash to purchase better equipment for himself. In a MMOG world this is often perceived as very unrealistic, as all prices are fixed, and shopkeepers are all non-player characters (NPCs).
In a player-run economy all weapons, armour and equipment has been "produced" or crafted by players themselves. To be able to do this players must first obtain the necessary resources, equipment and skills to be able to produce goods.
Once the goods are produced the player then must turn to the market and find out what people are willing to pay for his products. If he sets the price too high then nobody will buy it. Setting it too low will probably mean he will lose money, considering he had to pay or work to obtain the resources in the first place.
The idea is to make the game-world feel more dynamic and more like the real world. In some games that are not based on a player-run economy, gameplay can feel unrealistic as players discover what enemies to hunt to get an optimal loot/time ratio. They will get the good loot and take it to the static shop where the shopkeeper will pay them the same price every time. In a player-run economy this would not work, as the market would become flooded with this particular loot, and the price would drop drastically.
The uncontrolled nature of a player-run economy can also produce undesirable results for the players. For example, a player wanting to be a fletcher in the virtual world might find the game incredibly difficult if there are too many other players that decided that profession sounded fun as well. The game designer is left with few options when trying to make a highly player-run economy more fun.
