Veblen, Thorstein: The Theory of the Leisure Class

Helbich, Wolfgang

doi:10.1007/978-3-476-05728-0_18821-1

Cited by 1 publication

(1 citation statement)

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“…A long line of literature-both in game theory and beyondexplores the idea that an object's value to an agent can be impacted by the difficulty or cost of obtaining it. For example, this idea is implicit in the idea of conspicuous consumption (Thorstein 1899;Battalio, Kagel, and Carl 1991), which posits that agents value goods in part because they can be used to signal wealth. In such models, higher prices and scarcity are primary drivers of value.…”

Section: Related Workmentioning

confidence: 99%

Pay to (Not) Play: Monetizing Impatience in Mobile Games

Lundy,

Raman,

et al. 2024

AAAI

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Mobile gaming is a rapidly growing and incredibly profitable sector; having grown seven-fold over the past 10 years, it now grosses over $100 billion annually. This growth was due in large part to a shift in monetization strategies: rather than charging players an upfront cost ("pay-to-play"), games often request optional microtransactions throughout gameplay ("free-to-play"). We focus on a common scenario in which games include wait times---gating either items or game progression---that players can pay to skip. Game designers typically say that they optimize for player happiness rather than revenue; however, prices for skips are typically set at levels that few players are willing to pay, leading to low purchase rates. Under a traditional analysis, it would seem that game designers fail at their stated goal if few players buy what they are selling. We argue that an alternate model can better explain this dynamic: players value tasks more highly as they are perceived to be more difficult. While skips can increase players' utilities by providing instant gratification, pricing skips too cheaply can lower players' utilities by decreasing the perceived amount of work needed to complete a task. We show that high revenue, high player utility, and low purchase rates can all coexist under this model, particularly under a realistic distribution of players having few buyers but a few big-spending "whales." We also investigate how a game designer should optimize prices under our model. An appendix of the paper with proofs, more comprehensive results and visualizations can be found at https://arxiv.org/abs/2312.10205.

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Section: Related Workmentioning

confidence: 99%