I may not be well researched on this topic, and there is definitely a more complicated relationship than precious metal equals currency, but it is definitely not a "total myth". Debasement (or adulteration as you refer to it), was necessary when the value of the coinage deviated from the value of the base medal such that coin defacing became profitable. The fact that the this was a deviation from the norm kind of demonstrates that at some point in time prior the intrinsic and nominal values were close together. Likewise, after debasement, the new intrinsic value of the currency matched it's nominal value again.
There is a difference between a currency being backed by something and the actually currency *being* something. In effect by having a gold-backed currency, you make sure the currency's value cannot go below the value of the gold backing, but it can still go above that value by any amount. The value of have a resource-backed currency is that it protects you against an uncontrollable collapse in the value of your currency, which is why people do this.
The irony here is that the higher the nominal value of your currency goes above the value of it's component metals, the greater incentive there is to adulterate your currency; since you do not believe the nominal value of your currency is in any danger of shrinking enough that the reduced metal backing will actually matter.
I agree it makes sense to switch on the economy in pieces. From a game play standpoint, it makes sense to give the player a large degree of control... but from a role playing standpoint, certain pieces may make sense to automatically switch on according to the starting scenario, or world events, or the needs/demands of your home civilization. As a matter of practical implementation though, Toady might find some pieces make sense to bundle together. Also, from a gameplay perspective, it might be simpler for the player to understand if certain economy mechanics were bundled together. The proposal I outlined was an attempt to divide up the pieces that most go together into a two separate steps.
In most cases sites should start off in quite strict economic relations with their 'creator site' according to their starting scenario, they are required in effect pay off the 'debt' they owe to the site or other party that created them. For instance let us say we are a tavern site, we have to rent out of rooms initially not because we fancy doing so or because some code forces us to do so but because we have to raise money to pay in taxation/rent to our creator. In some instances we might be able to cheat, for instance we could mine gold, turn them into coins to pay our debt/rent/taxes to our backer and give the rooms away for free.
In return for accepting the economic restrictions, we would receive considerable support from our creator, which with surplus value toned down massively would be crucial for a new site to get off the ground quickly.
At some point you need to reduce those values into an actual dwarf behavior, which in turn means you will probably need to combine those values into a single value somehow. I'm think we can both agree the current value system is busted, but I still think at some point, the game needs to calculate an actual price. The price might be different for different dwarfs according to individual modifiers (indeed these differences between dwarfs should drive the barter system).
They are separate behaviors. They might get thrown together in the final playable area but there is no need to combine the actual values, merely juggle the priority given to different behaviors in different contexts, which yes can be done according to individual factors. In effect the following.
1. I try to get any food.
2. I try to get better food.
3. I try to get something other than food.
The issues are really how much priority to I put on getting better food VS getting stuff like clothing/furniture and ultimately money.
Thinking in terms of supply and demand provides a good starting point to model how economics work. There are cases in which supply/demand can be inelastic (which changes the slopes of the curves), or when there is a monopsony or monopoly (which does other things to how the curves intersect), or unusual types of consumer preferences (which again alter the curves, but don't change the underlying concepts). Are you taking about macroeconomics (in which money supply is a thing?). Or are you referencing some less mainstream economics (there are critiques of the homoeconomicus conception which I think are fair). I think microeconomics is a lot more relevant for fort mode gameplay, although a macroeconomic model of money supply might be relevant for worldgen. Likewise, in order to model dwarfs at all, viewing them as rational agents behaving according to some utility function is necessary.
Economics is not prices. I was talking about prices, prices sometimes correlate to supply+demand but there is no direct causative relationship UNLESS the supply we are talking about is MONEY.
Consider the reason why simply printing $1,000,000,000,000 per person and adding it into their account will not end world poverty. If prices were simply determined by supply and demand of the actual goods, it would do just this because neither the supply or demand went up because of your adding all that. It does not do this because the price of an item is simply based upon the money available to the *average* buyer of the item. Adding loads of money to everyone's account, simply raises the prices of all items to the point that you have in effect accomplished nothing at all with your 'charity'. To put it rather cynically, money is a zero-sum game: What matters is not how rich we *all* are but how much richer I am than you.
The only reason that demand is correlated with increases prices is due to the following process.
1. If an item is in short supply there is increased competition among the buyers.
2. The increased competition among the buyers means the richer buyers outbid the poorer buyers.
3. This drives up the average wealth of the buyers of the item.
4. As the price increases wealthy people intending to profit from speculation enter the market.
5. The drives up the average wealth of the buyers of the items still further.
6. The increased demand from speculators causes an increase in the scarcity of the item.
As we have already discussed, we can achieve an increase in price by manipulating 3, skipping out 1. and 2 altogether. We can also begin with 4, creating a shortage as a consequence of the speculative bubble even though there is no objective shortage of the item. In effect we can create a shortage as a consequence of increasing prices, because the speculators buy up the item in bulk driving up 'demand' for the item.
Prices are quite independent of Supply+Demand under the following circumstances.
1. All buyers have exactly the same disposable wealth.
2. There is only one buyer and one seller.
Pretty much the only function prices have is negative, they fail to inhibit the functioning of the economy (successful economy) or they directly interfere with the functioning of the economy (failed economy). They don't really do anything positive at all, they are basically a side effect of the demand for money and money in some strange loop feeds on it's own demand.
Okay... I think we are getting a bit off topic...
Potentially. The issue here I was referring to is how speculative values mess up the functioning of the economy. When speculators help themselves to the supply because they believe the price of the item is about to go up, causing a shortage of the item which in turn causing the price of the item to go up.
I think one thing that will have to be changed, be if in Fortress Mode or Adventure Mode, is that coins have to be useful. For example, in Adventure Mode, it is easier to carry meat from a kill to use for barter for items I need in town then using coins. In fact gems make for better international currency. Because if I enter a region run by a different Civilization any coins I have are now useless. They don't care if you have gold coins...those gold coins were not minted by them and, therefore, useless. That seems kind of weird to me. Or has that changed?
Surely some business owners would just see the gold or silver and not the Civilization who minted them. Towns on the border I think would be using two or three different types of gold, silver, and copper coins. Also, towns and cities had a person or organization whose business was to exchange money. Luckily most coins were almost standard weight between European nations but for some coins being shaved, worn, or forged. In other words it was pretty easy to exchange one gold coin for another.
And what happen when one Civilization invaded and takes over the cities of another? Do they replace all the coins? Melt them down and mint their own coins?
At the moment they just stop using money altogether and return to barter.
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Topic: Ideas for Dwarf Fortress Economic System (Read 8007 times)