Monday, May 11, 2009

Lindens vs. Dollars, debate continues.

There’s long been discussion and opposing views on what is a fair wage in Second Life® and the discussions usually lead to whether someone should work for a few dollars. There are those that suggest real life wages should be paid and those who don’t. Deciding what is fair is difficult but requires looking at a number of things, the value of lindens vs dollars, the buying power of both and the economics in world and out.

If you ever post an employment opportunity in XstreetSL®, you’ll find out what I mean. You’ll see a lot of responses questioning the value offered. I recently saw a couple of posts by people who said they expected to be paid approximately $L 8,000 per month. Is that fair? How was that number arrived at? What should be the in world wage scale.

To determine these things, I look firstly at the buying power of the linden and dollar. Simply put, I have found that what one dollar buys in real life, can be bought in world for a linden. Men can buy a shirt in real life for 25 dollars and up and here, they can buy a shirt for 25 lindens and up. There are always exceptions of course and barring freebies and dollarbies, the comparison stands. I can pick up a gorgeous outfit in real life for about 600 dollars and do the same in Second Life® for about 600 Lindens. All said what your dollar buys you in real life; the linden will buy in Second Life®.

The exchange rate of lindens to US dollars is approximately 240. What does this mean to the economics and wages? Well the exchange rate determines the value and consistency the currency has and equates the in world prices to real world prices. Simply put, what something is worth in real life is worth 240 times less in Second Life®. Back to the shirts, a 25 dollar shirt in real life would equate to a 10 cents in Second Life (25.00/240).

When considering wages, you have to consider the earning power of those you work for. A retail clothing store in Second Life may be charging 300 lindens for a dress as compared to its real world equivalent of 300 dollars. That clothing store could not pay its employees real life wages of 500 dollars a week or so. The clothing store would soon be out of business as its wages would probably exceed its revenue.

So what should wages be and in particular, what would be a minimum wage here. I think the answer is quite simple. Minimum wages should be the same as in real life, currently ranging from 6.55 to 8.06 per hour. Therefore I would think that a Second Life® minimum wage should mirror that and probably be in the range of 8-10 lindens per hour (350-400 per week). Since I’ve said that the wages here should mirror those of the real world, look to what comparable positions would pay in real life to see what their value is in Second Life®.

In spite of the above, there are those who will still say “Why would someone work for $1.45 a week?” Personally I don’t think that’s a fair question. I don’t know anyone or think anyone would come to Second Life® strictly to work or find a job. I believe they come for other reasons and then find that a source of in world income would help them with their purchases. Since they come to Second Life® for a variety of reasons, an employer is not paying them to be here. They are here anyway and simply want to use some of their time to earn money to use to purchase or invest. So again, look to the value of their purchasing power with what they earn.

An example of what I have been paying to my employees will probably further fuel the debate. Dancers in my club receive $L 150 per hour worked. That kind of is off from what I’ve been saying but considering they work 2-4 hours per week, their weekly income is 300-600 lindens. That gives them the buying power to purchase two quality outfits, which is exactly what you can do with 300-600 dollars in real life.

I haven’t gone in to the value of Land and tier but the little I have compared seems to follow suit with my theory. Land prices vary significantly but generally 20-40k will get you a nice parcel, same as real life.

This debate on real life vs Second Life® wages and payments will continue and certainly there are those on both sides who will never be swayed. But in my opinion, a dollar is a dollar is a linden and the earning and buying power are the same. If someone is asking for 8000 lindens a month, look to real life and ask if you would make 8000 dollars a month doing the same thing. Unless it’s a profession, I seriously doubt it.

Quite frankly, I think a reasonable starting salary in Second Life® is 500 lindens per week. With experience and knowledge, that number can certainly go up but 2000L per month goes a long way to purchasing what you need here as it does in real life. Anything more is simply unrealistic.

1 comment:

  1. Thank you for sharing your thoughts. I really appreciate your efforts
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