Pam had a very thoughtful response that comes from her knowledge of and experience with the subject matter. I have been exposed in a limited manner to SL and so my perspective is going to reflect that. I have heard of successful efforts about cities recruiting IT talent through SL, and distance learning examples.
I also would agree with Pam that SL provides that avenue to advance knowledge and expand your network. However, there are a number of other applications out there that will enable you to accomplish the same thing. I say, “Different strokes for different folks.” Whatever the medium used to make those connections and add perceived value to your experiences, then that becomes a successful path to take –it’s just that SL still resides on the fringe for the masses, i.e. perceived for its entertainment value I suppose.
With regards to government, particularly citizen engagement, and SL, my contribution here is more of a question: Why “simulate” an experience when you can (and should) have the real thing? I have seen some municipalities set up a SL experience for citizens to “play” democracy. Unfortunately, their “real” Web site lacked collaborative solutions for structured engagement and communication. Dialog from citizens, when given the opportunity, was still conducted as input received through email. I applaud experimentation, but let’s solve some basic challenges first.