[MUD-Dev] Economic Growth (Was: [STORY] Story and population size)

[Daniel.Harman at barclayscapital.com]

> -----Original Message-----
> From: Koster, Raph [mailto:rkoster at soe.sony.com]
>> -----Original Message-----
>> From: Daniel.Harman at barclayscapital.com
 
>> The next evolution in economies will require server based
>> categorisation and valuation of all items. We need the npcs to
>> compete in the economy on the same terms as the players, for this
>> to work, they need to know supply+demand+value.

> Wow, I thoroughly disagree. The next evolution in economies will
> involve getting the NPCs out of the loop, as they just distort it.

Wow, I'm surprised that those who have commented are against this
concept.  How do you feel they distort it, and would they still do
so if they knew the value of items? I acknowledge that in current
games they distort the economy with artificial price floors when the
values are hard coded, and they are always always willing to buy yet
another minotaur axe for 5pp when frankly the supply is so high they
must be worthless. Thats whats broken.

I can only see reasons why taking npcs out the loop is a mistake...

When npcs don't partake I don't see any way to support localisation
of economic state (at least without severely limiting in game
travel) so by removing npcs you are killing that whole avenue of
exploration as the only economic participants are highly mobile
players. You certainly aren't going to be modelling a trade
opportunity in lesser kysk if you can't import berry wine from
foreign climbs. In fact players only tend to value items they can
get direct utility from, which whilst pragmatic, makes for a pretty
uninteresting trading game.  I don't want the economy to be selling
farmed magic_sword_of_flaming_uberness to gimp_y, I want people to
be able to set up trade routes and hire caravans.

Furthermore, if npcs don't partake, you are harming the liquidity of
the economy. People play these games for fun, and with limited time
to play there are very few people who want to spend most of that
trading. Sure, you can go the automated vendor route, but in
isolation that has the potential to add ridiculous volatility to the
economy as players sell gear at way below market value because its
now *too easy* to partake in the economy.  NPCs partaking act a a
damper on this behaviour. Whether or not my thinking on this
volatility is accurate is hard to prove, although I think we will
have a good example when EQ implements this feature soon. There is a
lot of gear in people's banks, and its going to be dumped into the
economy when they add the automated player vendors. I contend that
non-active traders will have a huge negative impact on people who
like to trade, because they outnumber them and will sell too
cheaply.

The npcs don't have to be ultra-competitive although frankly I don't
see why a couple shouldn't be, they will have to buy low to sell low
so economic forces will prevail.

The best thing about npcs partaking is that they are deflationary,
if they are taking a 20% margin, thats money coming out of the
economy. Furthermore, you have a self correcting economy - if you
accidently patch in an item thats easily farmed and initially worth
way too much, its not going to stay that way for long as the vendors
wise up.

Surely an evolved economy is based on the trade orientated players
making money from higher volume lower margin trades, with less
active traders trading less and earning less. Right now trading
seems to be predicated on a limited number of high margin deals
generally at the expense of someone who doesn't know the real
value. Caveat Emptor, but not only is this an exploitative and
artificial environment, its also less interesting for the traders as
they spend most of their time waiting for deals not making them.

Maybe we have a fundamental disjoint in our economic outlook, I'd
certainly like to hear which of my premises you think are invalid,
and why.

Dan

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