FarmVille and the Entrepreneurial Spirit
After hearing about all the money that Zynga has made on its games, I felt compelled to check them out. FarmVille (and its cousins) is a real-time simulation of a business – a farm. It is essentially SimCity for the post-millennial generation. While I do not like the fact that it encourages children to spend real money to get ahead in the virtual world or that it encourages them to send unsolicited spam to their friends, I do think that it and other similar games play an important role in educating children about entrepreneurship. Here are the lessons I have gleaned:
- The initial size of any business is constrained by the initial amount of available resources.
- The available resources for investment in the business can only be expanded through either accumulating past profits or though the contributions of outside investors (i.e. parents with credit cards willing to buy game currency)
- As the scale of a business grows, its potential level of profitability per unit time increases
- The scale of a business can be increased through patience and the steady reinvestment of resources into ever more profitable endeavors
- Not all investments are equally profitable or require equal effort to maintain
- New investment opportunities are available to large businesses (in the case of FarmVille, new seeds and animals, which are not available to smaller firms
- A business will fail if it is neglected. The invested resources may become worthless (i.e. the plants die), and it may be unable to continue if a substantial amount of resources are lost.
The one very artificial aspect of all of the simulation games that I have played is that the prices and costs of resources tend to remain constant. That is, when a FarmVille farmer plants crops, he knows the price that he may sell them for before he plants them. In real life, businessmen do not have precise knowledge of their future revenues when they make investments. Although this would be an area for potential improvement, I think that these games are valuable in that they teach children lessons about entrepreneurship and help develop in them the drive to seek profit. Nonetheless, hopefully some kids will put down their mice and try to set up lemonade stands.
FarmVille
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