Listen broski, first of all you're idea is gonna fail on this principle alone: You're just HOPING players are going to act the way you want. They will not police themselves. They will not follow any non-binding rules. They will actively search to break the system. If your solution is to have an admin kill players who don't act the way you want, then why do you allow them to act that way in the first place??? Besides, isn't that a little hypocritical? "I want to be able to do ANYTHING in this MMO, but in this world without restrictions, players who do not follow MY vision for how the game should be played will be punished!" It's kind of ridiculous.
Secondly, your idea borders on being a life simulator. It's just too ambitious technically with a payout that isn't going to be satisfying to play. AND, imo, you didn't address the one part of MMOs that need the most work: the base fucking mechanics. You're just introducing more bureaucracy and infrastructure into a game system that is unironically boring to play. Action bars. Button pressing. Your goals don't really line up with how the average MMO is built. You might fare better implementing these thoughts into an economy simulation game or strategy game. You know what's incredibly not fun in real life? Running a country. That shit sucks.
Finally, take a cue from your predecessors, specifically Minecraft and Ultima Online. There's no real incentives to DO anything other than kill, loot, and burn as much as possible. In Ultima's post mortem the developers actually talk a lot about how the players basically became this plague to the idea of the game, and in hindsight it was to be expected. It's especially telling in Minecraft, where killing, looting, and burning is really like the smallest part of the game in theory, and yet griefing and fighting are widespread. Without structure, players don't really know HOW to act--in a sense, it's like a story with no villain or plot. These inherently flawed protagonists are just going to start creating problems because they have these otherwise unfulfillable character spines. So ya. Good luck, but don't expect much from basically every gamer's dream idea, that has also been tried and failed a billion times. At least not without a whole lot of refinement. A whole lot.