(I made a more recent post which basically replaces this one while doing a much more thorough analysis. Please read it instead of or in addition to this one.)
From my experience with use-based skill gain systems in Oblivion, Morrowind, and Darkfall, I’ve noticed that such systems are inferior. They should be avoided in favor of other approaches to skill-based advancement (as in Fallen Earth) and class/skill hybrid systems (like the one in Final Fantasy Tactics).
First, three gamist reasons why use-based skill gain is an inferior character advancement system:
The character can only be rewarded for a much narrower set of tasks. And that set of tasks is doing whatever action the player wants to level. It’s not clear how quest (or whatever kind of achievement system you want) rewards can fit into this framework. Use-based skill gain cuts out an important part of the incentive structure. In an RPG like Dungeons and Dragons, Dogs in the Vineyard, or Mousegard, combat isn’t an end, it’s a means towards surviving a precarious scenario. There are other means, such as parley, avoidance, and escape that serve that purpose just as well. With use-based skill gain, it becomes difficult to reward the player character for accomplishing anything except easily quantifiable combat and crafting tasks. This leads to gameplay focusing on direct combat and crafting, which narrows significantly the effective and beneficial conflict resolution methods.
Use-based skill gain leads to runaway positive feedback loops that restrict character growth and ability diversity. I kill using ability A so ability A becomes more powerful so I use ability A to kill stuff. This loop generates a second-order effect on skill growth. If you only have a few abilities that are strong enough to use against mobs that drop worthwhile loot, you’re going to use those abilities frequently leading to them becoming more effective and the farming being more efficient and worthwhile. In this way, characters are stuck using the same abilities because only certain abilities are day-to-day useful. But all the abilities are on a similar scale. The Illusion and Mysticism schools of magic were like this in Oblivion: they had some nifty effects, but they were largely composed of utility spells that you would never justifiably use enough to keep the skill level competitive with your melee skills or destruction magic.
Use-based skill gain encourages and rewards exploitation, macroing, and cheating. Some skills necessarily will be used less than others. By factors of hundreds. This forces designers to balance skill advancement against use. This problem cannot be solved. Designers need to measure skill-use frequencies and balance that frequency against how difficult advancement should be. But if a player wants to level a skill, he’s going to find ways to use it more than is reasonable, throwing these calculations off and leading to imbalance. If the player wants to level his buffing abilities, he is going to cast buff spells on everyone he sees if he’s nice, but more likely he’ll cast a buff on himself, then dispell it, and repeat those two actions until he has the desired skill level. Players will always seek to find safe ways to level skills, trivializing the advancement system—developers will always be behind in preventing this kind of behavior. Exploiting and macroing becomes the only way for an honest player to keep up. Darkfall’s EU server has fallen victim to this problem. Exploitation is always the most effective way of increasing skills and it breaks the balance of skill gain.
And one simulationist reason:
Use-based skill gain doesn’t make sense from an immersion/metaphor perspective either. People do not go out and put their life in direct danger to advance from novice to super-novice at using a sword. They spend years practicing with the weapon for several hours every day. The time spent practicing far outstrips that time spent in actual life-threatening struggle. When you’re engaged in combat where life is in the balance, the amount of skill you have when combat begins determines if you live or die. You’re focused on survival, not on dinging 34 on your sword skill. Certainly you will learn from direct combat, but not even a tenth the amount you learned from training since you were the age of 10.
Use-based skill gain should be avoided for primarily these four reasons. As a mechanic, I thought it was a great idea before I played games that implemented it. Now I don’t see a reason to go with use-based skill gain over a different skill-based advancement system, such as purchasing skill levels with XP or some other broader resource.