[MUD-Dev] Re: [DSG] Money supply in game economies (was: Broken Economies)

[Paul Schwanz]

Matt Mihaly wrote:
> On Thu, 5 Apr 2001 geoffrey at yorku.ca wrote:
>> Matt wrote:

>>>  a) If anyone has any ideas on how to make loans in a virtual
>>>  world feasible? It has to be extremely difficult to defraud the
>>>  banks (or interest rates will skyrocket to the point where
>>>  there's no incentive to borrow).

>> It may be a naive standpoint, but doesn't the old rule of 'provide
>> the tools, they'll do the rest' apply here?  I.e., the players have
>> the money, and they will, and do, extend loans - although I'm sure
>> they operate more as loan sharks than actual banks.

> I've never seen anyone in a MUD begin to reasonably simulate the way
> a bank gives loans. I see friends or acquantinces giving other
> friends or acquantinces loans, but I don't see 'banks' springing up
> where total strangers can go and get loans. The problem just boils
> down to the seemingly impossible task (at least in current game
> designs or forseen ones) of assessing player credit risk.

> Loan sharks don't fill the same purpose as a bank because a) they
> don't have enough money to loan and b) their interest rates are
> generally too high to be useful to an entrepreneur. Loan sharks
> appeal to either a) fools, or b) really desperate people.

Random thoughts on player created banks:

  1) There needs to be some sort of /sign function that will affix a
  personal, or perhaps more importantly, a guild/faction/organization
  signature to whatever medium is used by players to record
  information in-game.  (i.e. blank parchment, mind-crystal, etc.)
  The /sign function should cause the message on the medium to become
  unalterable as well as placing an unforgeable and uniquely
  identifying mark on the medium.  (Perhaps the signature also serves
  as a web-type link to a database displaying information abuot the
  signing party.)

  2) It seems to me that some sort of resource environment typical of
  an RTS might be helpful, where resources have actual in-game utility
  for constructing items, buildings, units, etc. that players find
  desireable.  These resources then become natural standards upon
  which to base currency.  The more difficult the resources are to
  transport, the more likely it is that players will begin to use
  signed parchment, crystals, or another medium to facilitate
  transactions.  Also, I would think that resources that were readily
  quantifiable and qualifiable would make the best standards and
  contribute most to a banking environment, facilitating the
  implementation of the next point.

  3) Player banks could have utility apart from loans.  If banks
  established several branches with resource reserves in each, then
  characters could deposit at one branch, travel a distance, and
  withdraw at another branch (minus a fee for the convenience).  Of
  course, the bank would then need to track resource reserves and ship
  resources around to the branches as needed.  The Wells-Fargo
  stagecoach rides again.  I bet you'd get a few mercenaries willing
  to ride "shotgun."  :P Also, these player "banks" could set up
  special accounts with other organizations which included additional
  services.  Maybe one bank offers to send a wagon out to a logging
  compound on a regular basis.  The bank representative give the
  logging company its wood certificates, holding back a little for the
  door-to-door service.

  4) If player banks give out loans, some sort of collateral could
  help with credit risks.  This might require deedable land, houses,
  livestock or other things considered valuable to the one giving the
  loan.  If the player defaults on the loan, the bank collects the
  property.  Also, character persistence might help some in this
  regard.  Character persistence tends to make a distinction between
  the character and the player.  If the character had value in itself,
  then it could be used to secure a loan.  If the player bolts,
  control of the character, its assets, skills, labor, etc. reverts to
  the bank.  You'd probably get some attempts at loan muling, but if
  the bank only gives out loans where it feels the collateral is worth
  the loss it might not hurt.  On the other hand, since creating
  characters becomes an open-ended faucet into the economy, this might
  require some additional thinking.  :P You wouldn't want to encourage
  such inflationary practices.  Limiting characters per account would
  at least see that you got a RL profit out of the deal, anyway,
  assuming you charge per account and indentured characters are not
  replaceable without purchasing new accounts.  Hmmm...but then what
  happens when a player stops paying for an account that has
  indentured characters tied to it?  Could get messy, but I don't
  think it has to be impossible.

  5) The value of the resource certificates would likely be influenced
  by confidence in the issuing organization as well as the actual
  resource it represents.  This could allow for all types of
  speculative endeavors.  Some player banks might actually issue more
  certificates than they had resources to back it up, effectively
  inflating the currency.  By doing so, they would risk losing the
  confidence of their customers and players might not continue to
  accept their certificates in transactions.

[snip some]


>>>  b) Has anyone implemented systems in their worlds that allow
>>>  players to act truly entrepreneurially?

>> What do you mean by 'truly'?

>> The guilds who sell protection are entrepreneurs.

>> The woman who does interior design in UO is an entrepreneur.

>> Even the players who used the bow command in UO to roleplay
>> prostitutes are entrepreneurs.

>> But, since I know you know all this already, I think I'm missing
>> the point of your question...

> As you'll see below, I talk about entrepreneurialism in terms of
> being able to multiply your efforts. There is no scope in current
> games to work your way up from employing 1 person to employing 1000
> people, which is how most entrepreneurs get rich (generally they
> either invent something they can sell, or they multiply their
> efforts through taking a piece of the labour of others). Yes, a
> prostitute is an entrepreneur. She's not doing much entrepreneuring
> if she's not looking to expand though (and the only way she can do
> that is by becoming a pimp and taking a piece of other whores'
> action).

>>>  I'm sure someone else can come up with a better list of
>>>  requirements for this, but I'd think that it would at least need:

>>>    1. Multiply your efforts by employing (almost certainly) NPC
>>>    workers.

>> Is there a reason it has to be NPCs?  Wouldn't the shop keepers
>> that people could position in front of their tents in UO count
>> towards this?

> No, doesn't have to be NPCs, except that I would prefer to not make
> players be, say, labourers in a field or a factory. I don't think
> they'd enjoy it.

With character persistence, you can have scripted player characters
(SPCs?) that can handle more laborious or mundane tasks while the
player is offline.  Also, World Fusion plans to have "natives" in
Atriarch.  I don't know too much about how they will work, but initial
appearances indicate that you will be able to hire them or gain their
support through other means (feeding them?  protecting them?) so that
you can use them as resources in trade or more war-like pursuits.
Again, I wish I had more details about how this will work.

>>>    2. A wide range (hopefully open-ended, but I know in my case at
>>>    least, that's beyond what I'm going to aim for) of
>>>    interdependent businesses that can be formed and grown, or
>>>    rather, a wide range of activities that a business may engage
>>>    in.

>> A key part of entrepreneurialism is the spark of creativity and
>> inventiveness.  I think a predetermined selection of possible
>> entrepreneurial ventures would play directly against the very
>> nature of the stated goal.

> Unfortunately, I don't see any way to make this an open ended system
> on a sufficiently large scale. I'm sure someone cleverer than me
> will figure it out, but I don't think I, for one, am capable of
> doing it. It seems to me that what this requires, almost by
> definition, is the ability to invent new products (and not just the
> same product with a new look) and to develop increasingly efficient
> methods of production. That's a mighty tall order for any game
> designer. If someone manages it well enough, I certainly will be
> signing up to play.

What about inventing new services instead of new products?  It seems
to me that players could be quite entrepreneurial in this regard,
given the right environment.

[lots more snips]

--Phinehas

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