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Nearly 500,000 people in developing nations earn a wage making virtual goods in online games to sell Tibia Gold to players, a study has found.

Research by Manchester University shows that the practice, known as gold-farming is growing rapidly.

The industry, about 80% based in China, employs about 400,000 people who earn £77 per month on average.

The practice is flourishing despite efforts by games companies to crack down on the trade in virtual goods.

Big industry

Professor Richard Heeks, head of the development informatics group at Manchester who wrote the report, said gold farming had become a significant economic sector in many developing nations.

I initially became aware of gold farming through my own games-playing but assumed it was just a cottage industry," said Professor Richard Heeks from the University of Manchester who wrote the report.