A relevant article about Edward Castranova's work in The Economist. Entitled "Synthetic Worlds: The Business and Culture of Online Games", the book shows how the online game industry is an excellent way to study what the author calls "the economics of fun". Of course it deals with MMORPG economics but the review describes two other issues I am interested in:

The starting point of his thoughts is very insightful:

While scientists developed sensory-input devices to mimic the sensations of a virtual world, the games industry eschewed this hardware-based approach in favour of creating alternative realities through emotionally engaging software. “It turns out that the way humans are made, the softwarebased approach seems to have much more success,” writes Edward Castronova in an illuminating guide to these new synthetic worlds.

Indeed, what is important is less the super-3d realism (given the 'uncanny valley' phenomenon), but instead the social components (as what I blogged the other day with the Trip Hawkins interview).

Also the final point is important too:

As technology improves, players could make enough money to pay for the upkeep of their real-world bodies while they remain fully immersed in the virtual world. Mr Castronova is right when he concludes that “we should take a serious look at the game we have begun to play.”