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littlered

Player owned economy

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littlered    154
I've been reading this development blog for Pirates of the Burning Sea regarding their economy - http://www.burningsea.com/pages/page.php?pageKey=news/article&article_id=10253 - and it just seems too good to be true. It seems MMOs tend to suffer from massive inflation and any goods statically priced at an NPC shop will soon become too easily available with low level characters able to afford the best items. But if the entire economy and every item and resource is sold by another player, then inflation will happen, but everything scales accordingly. Am I missing anything here? Or does this economic system work really well, as well as providing additional game play for people who want to operate as merchants? The only considerations would be how to get the economy started on a new server - I guess you'd need to artificially create some initial resources and buy/sell orders? Having NPC shops would be a nice feature in my game, and I'd see these working if the NPC buys them from the local market (after they've been listed a while to allow players to snap up bargains), and then applies a markup (at a fixed percentage of the price they'd paid - and maybe a modifier for the item's rarity). This way the NPC shop prices scale with inflation, and someone looking for magical reagants can go to the magic shop and find everything they need in one place, aware that they're paying a small premium for the convenience. It'd also be great to have player-owned shops in my game world, but I can't see why these would exist when anyone could got to an Auction House or Local Market and buy the goods directly. How could player owned shops be made to work with this economy? Thanks for any thoughts.

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KulSeran    3267
Look at EVE online. They have a fully player owned economy.
All the resources and money are harvested by the players of the game.
All the trade is done on a buy/sell order market place.
In the beginning (and at most patches) the designers placed NPC buy and sell orders on the market to seed it with important goods that don't have a working player base yet. After some time, they stop refreshing the infinite NPC orders, and let them all expire. This leaves only the player orders.

You can buy or sell things just about anywhere, but you have to get to the physical location to pick up the items. So this means there is economy in moving items from harvest locations to manufacture locations to sale locations. Entire player corporations revolve around transporting items between trade hubs. Large corporations often have their own internal shipment managers who make more dangerous trips from high to low security spaces.

EVE handles the "NPC shop" in two ways. One, there are NPC sellers for specific items like skill books, so everyone can always find training for their characters. Two, there are NPC sellers who trade loyalty points (earned through running missions) for special "faction" items that are better than normal drops and producable goods.

The two base movers for prices in the game right now are the reward amounts of ISK and LP from missions, and the payout for insurance on your ship when you lose it. Everything else gets driven by the players.

From a really really quick skim of the article you linked, it sounds like they are taking aspects of EVE Online's economy and trying them out in Pirates.

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littlered    154
thanks for the reply, I've not played EVE, but found a couple of articles discussing the economy in detail so that's a great help.

I'm still unsure how to implement player owned shops - I think diversity would be the key, but I imagine there would be too many players offering very similar selections of goods to differentiate them. Possibly restricting Auction Houses to the larger cities allows player run shops to exist in smaller towns and villages due to convenience of location?

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lithos    414
The easiest ways to "stop" inflation is to:

Have a barter economy. Though only in the sense that players can actually use everything. For instance you can have a few convenient items that are small and useful for the most common tasks in your game(crafting, magic, counter death penalty, min/maxing gear, or similar).

Have floating cash drains. Basically have limited resources that players compete over. For instance each city only has 5 to 30 shop/house/guild locations, to have such locations you have to be the highest bidder in auction for the month.

Keep money rewards "flat". One of the most obvious reasons for inflation is people rerolling characters AND bringing income from higher level characters. Essentially this means the weeny newbie income has to compete with the income of buffy the min/max character income(at weeny newbie levels).

Adjust total income per day to be somewhat logarithmic. Essentially making your first bit of income is 5 times easier than making your last bit of income. This means that you as the developer can easily estimate the average income of the whole player base, it also means that the most disruptive form of player(on all the time) has a smaller effect. WoW dailies are an example of this.

Upkeep. Everything needs upkeep and a noticeable form of it. As a matter of fact having peek min/maxxed gear/attacks/similar should require more upkeep than they can pay back while in use(or in use for more than an hour or two with logarithmic income). However it should be perfectly possible to make income "no matter what" by playing in a reduced form.

Use a "real" cash economy. Essentially if you want "gold" in game you buy it from the developers or trade with other players.

No "A" spots, professions, or tasks. Essentially you can't have areas that gives the character "everything" in one go. Want to level your character the fastest possible, you won't be making very much cash(maybe even losing depending on mechanics).

________________

You probably couldn't use all of these in the same game but taking a few together can go a long way.


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Cpt Mothballs    100
Players are going to go by priority.
Supply and demand.
Although, having any economy at all is going to leave you highly susceptible to gold farmers.
Letting them own an economy is like saying you hate making money.

I think a mix between the Grand Exchange of Runescape and a taxation on earnings when selling will change the flows of economy whilst removing the need for player owned shops.
Having item for item listings based around item listing prices and open ended offers will remove the need for monetary assets.
They'll also allow players to spend less time merching and more time playing.
Players will control the flow of items and the game will have base values input.
Supply and demand will inflate or deflate individual prices.

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littlered    154
Quote:
Original post by Cpt Mothballs
They'll also allow players to spend less time merching and more time playing.

But isn't there gameplay in being a merchant? It seems like some players in EVE enjoy playing this role, and I'd like offer as many alternatives to repeatedly killing things as possible.

Those players who aren't interested in being merchants can then rely on those who are to deliver their goods to wherever they need them.

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Cpt Mothballs    100
My point is, giving freedom of cashflow is like signing away your game to the will of gold farmers.
It's not like merching still wouldn't be viable, the idea is pretty flexible.
But it's just less important and necessary.

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lithos    414
Free flow of cash is not the same as giving away your game to gold farmers.

Having a player advancement that takes forever is a great environment for gold farmers. Anything that is a shortcut becomes much more attractive. In Runescape you literally learn/grow slower than a you do in real life(You can buff your body in less time, you can learn math faster than you can learn magic in Runescape, even basic things like learning to cook happen faster here than in Runescape).

_________________

If you want to get rid of gold farmers you just need to make your game highly interactive(gold farmers will babysit a handful of computers), add in randomness/dynamic-ness that makes game play less predictable, don't allow high level characters to "weeny" their way through low level areas, add in PvP areas that you "have" to travel through, reduce the incentive for short cutting advancement, and force your players to have a more than competent level of English.

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KulSeran    3267
Quote:

Quote:

Original post by Cpt Mothballs
They'll also allow players to spend less time merching and more time playing.


But isn't there gameplay in being a merchant? It seems like some players in EVE enjoy playing this role, and I'd like offer as many alternatives to repeatedly killing things as possible.

Those players who aren't interested in being merchants can then rely on those who are to deliver their goods to wherever they need them.

EVE has a very large role for merchants.
*There is the boring but constant need (constant, but smaller income) merchant, who moves goods from hi-sec to hi-sec so everyone can have access to items that only drop in some locations.
*There is the boring corporate merchants, who move goods from hi-sec to null-sec or null-sec to null-sec. They charge premium prices for corp members to waste their time, and set prices to move corp goods like fuel around.
*There are the merchants who pull the buy low, sell high trading. They will look for any place where they can sell a good at insane markup, and do so. They will look for existing buy and sell orders across regions, and fill them. They will look for lucrative player contracts and transport them.
*There are merchants who are stupid rich, who day trade in Jita. They'll buy up anything that is at a stupid low price and resell it. They'll buy up anything that is less than mineral value, and get it recycled and sell the minerals. They'll watch daily tends and adjust prices depending on the day of the week.

Quote:

Free flow of cash is not the same as giving away your game to gold farmers.

I agree. What gives the game to the gold farmer is having high level goods that are of value to low level players. The low level players don't have the in game money for the goods, so they either farm it with their high level character, or buy it with real money from a gold farmer.

Combine that with the thought that:
Quote:

Having a player advancement that takes forever is a great environment for gold farmers. Anything that is a shortcut becomes much more attractive.

I think the key there is the notion of "shortcut". EVE's advancement takes forever, but all the farming in the world can't shortcut it.

Part of why they can't shortcut it in EVE is that training takes time, not experience. With an experience system like WoW, you can use farming to make a more optimal path to get the most XP/min, or to get enough reagents to quickly train up a trade skill.
In WoW, I could buy my 5000 silk and 15000 runecloth(tailor training), my armor, my enchants, etc, and have a level 80 to play with my friends and be done with the costs. The allure of farming in WoW is that one person farming can earn real cash for helping get people to level 80 so they can raid with their buddies.

EVE trades the experience grind for a money grind. Everyone money grinds. Everyone loses money by losing ships. All of a sudden money flow is part of everyone's life, and while many are willing to buy credits, the costs continue with continued gameplay.

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lithos    414
Yes EvE's Real time advancement system is innovative in how it's used.
With relatively casual play you can keep your ship up to date with non-peak components and have some great fun with it.
The real time advancement also allowed them to expand their market base into the web empire building market(as a matter of fact the game is rather intuitive to that market base).
Also allows for A LOT of market reasonable-i-ness, you don't need to grind out basic stuff in crafting/combat/whatever then sell it at whatever price to make up for losses(only need to make/sell what you know can be absorbed).
The mechanic of one account one training "thread" also handles quite a few problems that arise from alternate characters.
The real time advancement also encourages the player base to keep subbing even if they won't play "much".

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littlered    154
I think there needs to be careful balance between thwarting gold farmers and rewarding genuine work within the game. If someone is prepared to put in the effort and transport goods around or craft a lot of items that they can then sell, then they should be rewarded for their time and effort.
Quote:
I agree. What gives the game to the gold farmer is having high level goods that are of value to low level players.

I think that's a very good point, and it's not something I've solved yet. I had a few ideas about items needing much more repair if a player is lower than the optimum level for it. So that a player could use a higher level item but they'll need to pay a much higher upkeep for it. It doesn't stop twinking and it is something I need to look at soon.

I still can't resolve the problem of player owned shops though - it's been rolling around my head all week. Is it worth the effort? I assumed some players would get a lot out of owning and building a shop (similar to UO) but I still can't see how they'd fit into this sort of economy - why would you trek around several shops when you could just got the Auction House and probably get the item cheaper?

And the other thing I couldn't work out, is why Sell Orders exist in EVE - what's the benefit of using a Sell Order over putting the item for sale on the Market/Auction?

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lithos    414
Sell orders basically let the producer set the price to whatever they want(at the cost of having to wait for someone to buy)

Buy orders basically let the buyer set the price to whatever they want(at the cost of having to wait for someone to sell).

As such in a reasonable economony you'll end up seeing something like this:

Buy X bids: (waiting for someone to sell)
buy 5,000 @ 12.5
buy 10,000 @ 13
buy 5,000 @ 13.5

Sell X bids: (waiting for someone to buy)
Sell 3,000 @ 14
sell 4,000 @ 15
sell 1,000 @ 16

__________

So for the cost of waiting for someone to agree with your price, is just waiting long enough.

The market will tend to work best when you see bids both ways. Otherwise the market will tend to be blind to seeing the needs of either the buyer or the seller. Which in worse case scenarios could mean that it could take weeks for the market to correct itself, and also means that 'playing' with the market becomes quite a bit harder.

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KulSeran    3267
Quote:

And the other thing I couldn't work out, is why Sell Orders exist in EVE - what's the benefit of using a Sell Order over putting the item for sale on the Market/Auction?

In the auction world:
1) people offer a good now for money later (place auction).
2) people offer money now for a good now (buyout).
3) People offer money now, in the hopes of a good later (bid).

In the market world:
1) people offer goods now for money now (fill a Buy Order).
2) people offer goods now for money later (place a Sell Order).
3) people offer money now for goods now (fill a Sell Order).
4) people offer money now for goods later (place a Buy Order).

Notice that in the auction world, the buyer has no control and the seller has no feedback. The buyer either finds the price reasonable and purchases, or hopes for something better. The buyer also can't express a need for an item unless that item exists. In that way, only people selling items know what they sold for last and how often they sold. To judge need for something you have to try selling it. To judge the price of something you have to guess a price.The whole system is driven by "i need to get rid of this" and "I'll pay that cause I don't want to wait for a better offer". Its hard to get good sale prices, and hard to find good items cheap. Also notice the singular good. If I have 2000 copper, I can either auction 2000 copper, or 20 stacks of 100 copper, or 200 stacks of 10 copper. As the seller I have to choose the granularity of the sale, and can't both appeal to the mass buyer and the casual buyer. Once a seller places an auction, they also lose control of the price. He can't adjust the min price or the buy out. He can't take advantage of market trends.

Notice in the market world, the buyer has as much control as the seller. Buy orders tells sellers what items might be worth, and how much need there is for them. Buy orders let traders pay for items where they are common, so they can ship them and sell them for more at a trade hub. Buy orders let me pay now to insure that I will at some point, without having to hunt down a seller, I'll end up with the goods that I need. Lastly buy and sell orders have volume. So if I have 200Million tritanium, I sell order it. People can buy it 1 at a time, or 10Million at a time, or the whole lot. The buyer chooses the granularity of the sale. I'm selling the plural goods, unlike the auction. The seller still retains some of the auction control in setting prices. With high enough volumes, the prices stay where the biggest seller is. If the market trends in a direction, the sellers can adjust their orders to take advantage of the new price point.


EVE has a market AND an auction house. The benefit of the market is getting the best prices, locations, and least wasted time. The benefits of the auction house are selling items that EVE's market doesn't allow. This is stuff like the rare faction items, fully assembled and customized ships, unique ships and items, and random collections of items. I can Sell all the parts of a space station in sell orders by part type, or I can auction the entire set of parts to build the station in one big stack. People are often willing to pay the premium price for the convenience of getting everything in one package that is good to go.

The biggest problem you are going to face with NPC shops is what happened in Ragnarok online. Everyone wonders into the sale area and puts their dood into vendor mode. It isn't as good as the auction house OR the market. I have to sift through 100 people's shops to find the item i'm looking for. At least in the auction house i just have to scroll through hundreds of auctions of "navy vexor" to find the ship I want at a decent price. And on the market, I can just search for an exact item, place, and price.


[Edited by - KulSeran on May 9, 2010 12:05:43 PM]

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Edtharan    607
It is natural for designers to design an economy to be similar to how they encounter their real world economy. However, this is not necesarily a good model of how the economy works.

Most people's ecperience with an economy is:
1) They go do work
2) They get paied some money
3) They spend that money

This is the Source/Sink model that crops up so often in MMOs and other games, and, while it is a good model of how an individual intyeracts with an economy, it is not a good model of how an economy actually works.

The biggest problem is that it treats Money as the same as Value and also treats Value as if it is a constant between all individuals and times.

To put it simply, none of those are true.

Money is not the same as value. It is true that money has value, but that the value of money is not a constant. Money is a "potential" in the economy. It represents a potential good or service.

eg: If you had a Cow you wanted to trade for corn, and I had corn that I wanted to trade for some meat. Then we have a potential trade. But if I didn't want meat because I already had some, then I would not want to trade my corn for womething that I didn't want (more meat), so no trade could take place.

However, if we use a "potential good/service" as a trade medium, then you could trade me theis potential for my corn and then I could exchange that potential for something I did need (say a new millstone to grind up the corn - or the service of a miller to grind it for me).

Thinking of money like this means that the value of that money is only the value of its potential. If nobody is using that potential, then the value of money drops.

So, money is not value, but it is potential goods and services.

As for value, it is not a constant, but is dependent on the situation (the circumstances of the individuals involved.

A simple way to demonstrate this is by this situation:

Of what value is a glass of water to a drowning man. But of what value is that same glass of water to a man dying of thirst.

Inthis, there are two individuals, on, the man drowing has too much water, and so does not put much value on having more water. But the man dying of thirst has no water and so places a large value on any water.

This is encapsulated by the law of "Supply and Demand". That is: The greater the [isupply[/i] the lower the value, the greater the demand the greater the value.

But supply or demand are not evenly spread around the economy or in time (sometime someone will have a lot of something and other times they might not have much of it).

So the value an individual places on something (including money) is not a constant, but fluctuates as their situation changes.

Inflation (and deflation) occurs because of these two effects. Because the value of money is not constant and fluctuates becasue the value of the goods and services it acts as potential for fluctuate and that the supply of money (and the goods and services it represents) goes up and down.

So, if you keep increaseing the supply of goods/services/money into an economy, then the value of them will go down due to supply and demand. This measn you have to pay more for them and you get inflation. If you decrease the amount of good/services/money in the economy, then their value will go up.

This is sort of what the Source/Sink model tries to reproduce. They use sources (monster drops, etc) as the source of the goods/money and then use item wear and vendors to act as sinks for these sources. However, the ballance must be just right or you will get inflation or deflation.

Why these sink/source model can never get this balance right is that the balance depends on the number of individuals in the economy and their activity. If a player hoards goods and money, then this acts like a psudo-sink, but only for as long as that player does not release it back into the economy.

This causes an effect on the economy like a deflation and unless the game/developers do something about it, then it can wreck the economy of the game. However, if the player were to release their hoarded goods and money back into the economy, then this will act as a source and unless something is done about it, it will cause inflation.

Also, the more players in a game the more activity is needed to support them. If the game uses a sink/source model, then the more players in the game the more players will be putting resources into the sinks. However, if done right the amount of players going out and getting the resources (eg: questing, gold farming, etc) the more of it there will be.

And this is where the gold farmers are a problem because what they do is to focus their efforts on getting resources and minimising their expendature of resources. In effect, they will try to circumvent the source/sink model, so any imbalance in the model (which is inevitable) they will exploit and your economy will be ruined (or at least need constant adjustments).

Now it gets complicated.

In a trade, there are actually 4 values that exist in the trade.
1) The value the seller puts on what they own (the good or service they are selling)
2) The value the seller puts on what the buyer owns (usually money)
3) The value the buyer puts on what the seller owns (the good or service they are buying)
4) The value the buyer puts on what they own (usually money)

Now, if the seller values what the buyer owns more then they own, then they are willing to trade. If the buyer values what the seller owns more than what they own, then they are willing to trade. And, only if they both are willing to tradde can any trade take place.

the important thing to note is that the values each person puts on the deal does not have to mathc up with the other. In otherwords, the total value, when one side is suptracted from the other does not have to equal 0. Trade is not a 0 sum game.

Because trade is not 0 sum, this means that total value of the economy can be increased from trades (why do you think businesses and governments but so much focus on trade deals).

In the way individuals interact with the economy, we never really have to deal with these kinds of effects, so the models we create for economies don't reproduce them or take their effects into accout if they do occur (and when they do it is not usually by design, but by accident).

This is what borrowing money from banks is all about. The idea is that the borrower uses that money to create more value through some mechanism. This increased value can then be used to aquire more money to pay back the loan. Governments effectivly purchace this "value" by printing more money.

So, how could you apply this to a game.

First of all, because a game is not like real life, it is possible to know precicely the state of the economy at any moment. This is good because we don't have to guess any of this (or spend a long time collecting the data).

When an autority create money, they increase the supply of it and thus cause all money in the economy to reduce it value. IF you remove money from the economy, then you cause the remaining money in the economy to increase in value.

But, this does not change how the individuals value the various goods and services that ecist in your economy because money is not the same thing as value. Money has value, but they are not the same thing.

In the source/sink model, the developers try to regulate value by removing money. This doesn't work as they are only effecting the value of money, not the value of the goods and services it represents. All chainging the value of moeny does is make it harder for those without a lot of it to trade for the goods and services and allow the ones with it to dominate.

If the value of the money devalues too far, then players will jsut end up using some other object as their medium of exchange (and potential good/service). If the NPCs in the game then don't recognise this new "currency" then things can get really complicated and out of control of the developers.

So, just creating or destroying goods is not the solution as it doesn't really target the problem.

What I am going to do is to turn the idea of controlling an economy on its head. Instead of a central aurthority (the developers) being the ones in charge of creating or destroying resource, what if you put that control into the hands of players?

Of course, you would have to put into place mechancis to control it, but it can be done.

If a player could create resources, but not directly benifit from them, then when they create them, they reduce the value of the resource in play. But this means that when they create resource, they end up devaluing their own.

However, if a player could only destroy resources that they own, then this means that they reduce their net worth by destroying resources.

Under this system, why would anyone choose to create or destroy resources?

Well think back to the trade concept and how there are 4 values in any trade.

If a player wanted resources, but didn't have them, then they could create new resources and thus lower the value of them and thus get more of them in a trade. But, if they ahve resources they can easy get and can trade for them, then they might destroy their stock piles to increase the value of them for future trades.

As players both want to increase and decrease the values of the resources, then this creates a self balancing system controlled by the players.

Now "destruction" of a resource could be just not making it (not mining for it, crafting it, etc) thus increaseing it scarcity, so it does not need to be a direct deleation of their own stocks. And so "creation" of a resource does not need to be a direct spawning of the resource.

eg: A smithy might want cheaper ore so they make lots of mineing picks and sell them cheaply and thus making mining more attractive because the costs to do so are reduced and thus more ore is produced and supply/demand means that the price of ore will drop.

As you can see, by moving the responsability of managing the economy into the player's hands you can create a self regulating system that avoids uncontroled inflation or deflation and also avoids gold farmers (as their act of increasing a resource causes that resource to become devalued and they end up harming their own value).

It creates a self enforcing limit, but does not actually prevent players from temporarily exploiting the natural fluctuations that this kind of economy would do. It means that an astute player (or just lucky player) can manipulate or exploit these fluctuations for their own advancment. Just like in real life.

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littlered    154
Quote:
by moving the responsability of managing the economy into the player's hands you can create a self regulating system

Can you completely hand over economy management to players? How do you handle quest rewards and loot drops?
I had started thinking about having an indicator of the amount of inflation and scaling any gold drops that occured - or would you avoid any kind of currency being dropped or offered as a quest reward?
(thanks for taking the time to type all of that out - it's very much appreciated)

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Edtharan    607
Quote:
Can you completely hand over economy management to players?

Yes, you can completely put the economy into the hands of the players. Some players will establish themselves as an authority and other players will defer to their economy rather than use their own (it takes time, effort and the ability to back up their currency - the value I was talking aobut), but you can give players the ability to do so.

Quote:
How do you handle quest rewards and loot drops?

This is actually what I am arguing against. Loot drops and NPC vendors are part of the Sink/Source Model which does not work without constant maintainance (and even then can still go completely out of control).

The real value of an economy is based on the effort that the members of that economy can put into it. The more efficient they are the more value can be created by them (this is what Adam Smith was talking about in his book "Wealth of Nations" - a good read if you are interested in economics, even for game economics).

If you make things like money and resources drop through the normal activities the player would ahve to do, then the value of the effort put into these resources is 0. And, because the value is 0, the value of the economy is 0.

Designers try to comensate for this lack of value by trying creating scarcity and haivng rare items that only occasionally drop. However, this is only a false scarcity and not real scarcitry, as this scarcity is only a matter of time, and any player willing to put the time into it can get it, then the actual value of that item is effectivly 0 because the actions of the players removes the scarcity.

In a player run economy, the players have the ability to create curency. When they create currency, they devalue that currency. If the player then ahs the means to remove some of that curency from the game, then they can increase the value of that curency.

The two restrictions you need to place on this are:
1) The currency created by a player does not directly benifit them. This way a player can't just create more curency to satisfy an imediate need before the knock on effects caused by the creation of that curency

2) The curency the player removes must come from them directly. This way a player can't jsut remove currency from the game to boost the value of thei curency that they hold.

The decision to create or destroy curency should be based on the need to facilitate transations using that curency. This is what these two rules do.

Any item can concevably be used as a curency, so these two rules must apply to every item in the game.

One of the rules that also needs to be implimented if you are hainv crafting is that a player, with effort, can convert one curency into another. This is what crafting is all about.

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Polama    1105
The problem, ultimately, is the tendency for value to beget value. The more value a player controls, the greater their sway in the market: If I purchase all the iron ore, its price (and the price of derivative goods) will rocket to the value of the highest priced action you can take with ore, and this value will tend to increase with time as well (as everyone's weapons break down they'll grow increasingly desperate for iron). The price of ore will attract more and more miners, eventually overwhelming my ability to corner the market. But until that time I can slowly sell off my iron for massive profit. I end up ahead, and all the other players suffer an unpredictable economy where at any given time there are basic goods they can't obtain. The system of players creating/destroying wealth won't work as long as a player can't be forced to sell something at the market rate, and do you really want players to arbitrarily have their goods taken away?

How to avoid this? You could declare a winner when value is too concentrated and reset. You can use sinks/sources to deflate successful player's values (e.g. ensuring a cheap source of iron ore when liquidity is low). You can figure out a system where value doesn't create value: where rich players have no more economic influence then anyone else. With a large enough world you could potentially always have a balance to powerful players (collusion is tricky, though...).

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Tiblanc    560
Quote:
Original post by Polama
The problem, ultimately, is the tendency for value to beget value. The more value a player controls, the greater their sway in the market: If I purchase all the iron ore, its price (and the price of derivative goods) will rocket to the value of the highest priced action you can take with ore, and this value will tend to increase with time as well (as everyone's weapons break down they'll grow increasingly desperate for iron). The price of ore will attract more and more miners, eventually overwhelming my ability to corner the market. But until that time I can slowly sell off my iron for massive profit. I end up ahead, and all the other players suffer an unpredictable economy where at any given time there are basic goods they can't obtain. The system of players creating/destroying wealth won't work as long as a player can't be forced to sell something at the market rate, and do you really want players to arbitrarily have their goods taken away?


This may happen for rare materials, but not for basic goods. Since the basic goods are widespread, they must use common materials, which means everyone should be able to go mine some if the market price gets too high. The price hike will be countered rapidly since access to these basic materials is easy and there is a lot of demand for them.

A free market shouldn't need any rule and will regulate itself if basic resources are available to all players in some form.

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Polama    1105
Lack of scarcity adds a ceiling price (How do I value an hour of my time? Then that's the most I'm willing to pay for an hour's production of that good). But now you're back to the original issue of inflation: the product's value will fall towards the minimum someone values their time. And without sinks, the quantity of a resource increases and increases. Maybe the iron has a sink, as players craft swords, but eventually that market will saturate. Unless there's wear, and swords are gradually destroyed: but now the game has sources (the resource you can always mine more of) and sinks (wear), and you're back to figuring out how long a sword should exist to keep its value balanced.

In an open system, playtime is the basic source of value, and that's something that's always increasing (creating inflation) and you move towards everybody having everything they want (or an eternal influx of better and better stuff). In a closed system, resources will concentrate in a few hands, making things unplayable for the have-nots.

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Storyyeller    215
Therefore, you need to make fun activities to burn up resources.

For example, in Runescape, an hour of playing around with Ice Barrage (a very high level spell), would use thousands of runes, which is several hours of runecrafting, even for a really high level runecrafter.

The main problem is the possibility of bots or gold farmers. Their value of playtime is negligible compared to a normal player, thus heavily skewing basic resource collection or whatever they do.


Another issue is that people are willing to spend lots of money and resources to train a skill, but the skill can't be unlearned. Therefore, you need a steady influx of new players to prop up demand.

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Edtharan    607
Quote:
you need to make fun activities to burn up resources.

In the real world this is called entropy.

In EVE online, player's ships and equipemnt can be destroyed through the normal course of gameplay. When you loose something you loose it for good. In a way, this can be seen as a skin, but it is actually different than an economic sink as used in games.

In games, sinks are used to control the economy and to adjust inflation/deflation that occurs. However, in EVE, this attrition is not used to control the economy, but the economy (the value of the goods and services offered) is instead controled by the players. They set the prices and pay for the goods and services, and it is this controls the economy and it is this that makes it different from a sink/source model.

In a game like WoW, the developers control the drop rate (and to a lesser extent the amount vendors pay or charge). This emans that there is a (almost) static pricing of goods and services, it is just that the amount of drops increase or decrease. If someone or a group comes aong and rapidly explois an imbalance in the drops rate to sink rate (gold farmers) then they can quickly cause a disruption to this sink/source economy.

If, instead the decay and drop rates are fixed, but the value of the goods and services are allowed to fluctuate, then this control over the economy to the people in the economy and it self regulates. Gold farming will still exist to some degree, but as Polama said, the value comes back to time.

Gold farmers have to spend time gathering their gold (or toher resources). But, as they collect gold, the value of that gold decreases. This emans there will come a point where the value of the gold they can get, is not worth the time they would have to put into it and the system reaches an equilibrium.

Now, you might get a griefer that attempts to do this to make life hard for other players. But, because of the size of the economy in an MMO, it becomes impossible for a single player to cause that much disruption because of the time needed to collect enough resources to effect the economy.

By implimneting the two rules I have stated:
1)When a player creates wealth (currency or resources) it can't directly benifit them

2) A player can only destroy wealth (currency or resources) that they possess

It means that a player can't simply just manufacture wealth for themselves, they have to do it in a way that benifits the other players.

Take for example loans:
Takeing rule 1, I can create currency but not directly for my self. I could create currency as a loan to another player. Although they get the money, I can't yet benifit from it, and the creation of that money causes the money I have to devalue.

However, when (or if) they pay it back, they will have used it to perform some action that creates other resources (if they are smart). This means the economy has improved because there is now more activity going on in it (remember the value of a currency is the potnetial that it can be put to so the more activity, the greater the potential). then when I get the money back, I can destroy it and this increases the value of all the money.

So the drop in value from creteion is canceled by the rise in value from its destruction. But there has also been an increase in value due to the activity of the money (if it has been invested wisely), which means that there has been a total gain in value.

Now, you could not destroy all that money you get back, and leave just enough to account for the increased value due to the activity of the money. This would leave you with a bigger bank account and the economy has improved wihtout money being inflated or deflated.

However, what occurs if the borrower dosn't pay back the loan. Well, you then the economy has more money, but the value has not increase, whcih means that the value of the money takes a big nose dive and inflation sets in. The way to remedy this is for players to destroy their stores of money (which is not likely and why you need an authority to deal with that).

The problem with destroying money in a situation like this is that it means that less activity is going on because ther eis less money in circulation. But having too much money in circulation with not enough value in the economy means that you need vast amount of money to do even simple transactions, and those without a lot of money can't afford to operate in the economy (in real life this means poverty, in games it means that they will probably jsut quit).

So in this case (of massive inflation) the aim in a game is to eliminate the amount of money in circulation without reduceing the value of the economy and leaving enough to still facilitate economic activity (trading, and other investments).

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cbass2    138
pretty simple really

Even in a player controlled economy, the designer still has 100% indirect control. They can't change price, but can change supply (or demand) by simply manipulating "drop" rates or other variables.

activities of the players do can either create or destroy (objects or currency.)
if there are lots of ways to create (drops, mining, quest rewards, selling loot to npc) without enough ways to destroy (money sinks, consumables, "soulbinding") then the relative value of that object or currency will decrease until an equilibrium is reached.

Basically, the game designer has to manage the ways things are created and destroyed in order to control the relative value. (currency or objects)


Common problems and solutions:

-High inflation of currency? decrease supply (drops,etc), increase demand (money sinks)

-Items too expensive for noobs? increase supply, or increase noob's ability to to generate cash

-Rare item too expensive? Increase supply (make it less rare) or lower is value (decrease its stats)

-Good item too cheap? decrease supply (make it more rare)

-Gold farmers? different ways to tackle this one, but the way I like is for game designer/publisher to sell gold/items/game cards cheap enough to run them out of business. Other good ideas in this thread is to make the game complex enough where gold farmer can't multi-screen, or require English

-someone corners a market? I like the buy and sell orders for this. It makes the equilibrium price much more visible. If an item is hard to obtain this will happen, no avoiding it. Its up to the industrious players to keep a hidden supply of commonly "market cornered" items and undercut them out of business. Having these items for sale for real-world currency would help too.

-crafting decreases value relative to required items? (see WOW) This is because crafting has no cost (it actually has negative cost since skill level increases have value). If it took a character 5 days to build something and he was idle the whole time, it would actually add value. (this is decreasing supply of the crafted item)


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Quote:
Original post by Cpt Mothballs
Players are going to go by priority.
Supply and demand.
Although, having any economy at all is going to leave you highly susceptible to gold farmers.
Letting them own an economy is like saying you hate making money.


EVE countered this by allowing players to buy game time with ISK, and to sell game time bought with real money for ISK. In essence, EVE itself sells gold to players - which is extremely smart of them to capatilize on this market. Kinda like if the Government would just make drugs legal and tax the hell out of them, drug sells are going to happen anyway, controlling them with your economy though - priceless.

On a different note, I've always been unbiased and open-minded about what games I play. A few years ago I stumbled upon Neopets(laugh it up), and while alot of it was geared more towards small children, I did find that the stock market that they have on that game is much more adult oriented. I would love to see this sort of stock market in future games that is player-driven economy based, with the prices fluctuating based on the businesses and items in game.

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