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Author Topic: Economics discussion panel  (Read 7278 times)

Tamren

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Re: Economics discussion panel
« Reply #30 on: September 07, 2007, 06:03:00 pm »

Its hard to say what would work best here. I guess we will have to wait for the new version to figure out the exact details.

Once the economy starts up, it would make sense to use the value of the material used to make the coins. Its a simple system, you make coins, hand them around, the bookkeeper keeps track of everything. Your coins would only circulate among your dwarves and your closest trading partners. If you buy stuff for the humans for example and pay them in dwarf coins, they would most likely pay you back using those same coins before using human currency.

Anyhow, later down the road the value=material system would not work as well. We would need to switch over to a more government controlled system as used by most countries IRL. Instead of a copper coin being worth 2 cents, and a gold coin worth 60 cents or whatever, a copper would be worth 25 cents and a gold coin would be worth 5 dollars. This would have many complications that you could only manage in a developed fortress, namely:
1. Coins would have to be vaulted and aggressively protected since they are worth a lot.
2. The government would have to inspect every coin to make sure it is of equal weight and that no one is shaving off the corners or something. This means the creation of a mint.
3. Instead of "coins from Freecudgels", any coins put out from my fortress would be Dwarven coins that COME from Freecudgels. These coins would start to circulate father abroad and be interchangeable with dwarven coins from other such developed cities.

Currently the game has not reached that scope yet, but something like this would definitly be needed.

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Felix the Cat

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Re: Economics discussion panel
« Reply #31 on: September 08, 2007, 01:26:00 am »

quote:
Originally posted by Tamren:
<STRONG>Once the economy starts up, it would make sense to use the value of the material used to make the coins. Its a simple system, you make coins, hand them around, the bookkeeper keeps track of everything. Your coins would only circulate among your dwarves and your closest trading partners. If you buy stuff for the humans for example and pay them in dwarf coins, they would most likely pay you back using those same coins before using human currency.

Anyhow, later down the road the value=material system would not work as well. We would need to switch over to a more government controlled system as used by most countries IRL. Instead of a copper coin being worth 2 cents, and a gold coin worth 60 cents or whatever, a copper would be worth 25 cents and a gold coin would be worth 5 dollars. This would have many complications that you could only manage in a developed fortress, namely:
1. Coins would have to be vaulted and aggressively protected since they are worth a lot.
2. The government would have to inspect every coin to make sure it is of equal weight and that no one is shaving off the corners or something. This means the creation of a mint.
3. Instead of "coins from Freecudgels", any coins put out from my fortress would be Dwarven coins that COME from Freecudgels. These coins would start to circulate father abroad and be interchangeable with dwarven coins from other such developed cities.

Currently the game has not reached that scope yet, but something like this would definitly be needed.</STRONG>


I'd just like to point out once again that the value of a coin is not determined by the value of the material it is made out of. Or rather, it is, but in a different way. A one-ounce gold coin is always worth one ounce of gold - that's a tautology, obviously. But if you have 100,000 one-ounce gold coins, each one is worth much less than if you have 1,000 of them.

Money is a commodity and is affected by supply and demand, just like everything else. This is why economic simulation is so difficult: there is no fixed measure of value in the actual economy.

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Turgid Bolk

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Re: Economics discussion panel
« Reply #32 on: September 09, 2007, 11:17:00 pm »

I just found a nifty essay on MMORPG economics, which has some relevance here, and besides that it's damn interesting. Check it out here.
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Tamren

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Re: Economics discussion panel
« Reply #33 on: September 10, 2007, 01:17:00 am »

quote:
Originally posted by Felix the Cat:
<STRONG>Money is a commodity and is affected by supply and demand, just like everything else. This is why economic simulation is so difficult: there is no fixed measure of value in the actual economy.</STRONG>

Of course, but obviously not all of that can apply here. There is no "global" economy to speak of. All trade done with coins is between neighbors. The supply and demand mechanics which should exist anyway are still waiting to be implemented. When they arrive they will still be localized.

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Felix the Cat

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Re: Economics discussion panel
« Reply #34 on: September 10, 2007, 12:17:00 pm »

quote:
Originally posted by Tamren:
<STRONG>

Of course, but obviously not all of that can apply here. There is no "global" economy to speak of. All trade done with coins is between neighbors. The supply and demand mechanics which should exist anyway are still waiting to be implemented. When they arrive they will still be localized.</STRONG>


This has absolutely nothing to do with a "global" economy; I'm not sure where you got that idea from but I certainly did not mean to imply it in my statement.

My statement is especially true for a localized economy. If you keep the amount of people and stuff in the economy constant and increase the number of coins, each coin will be worth less, and it will take more coins to purchase one thing.

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Tamren

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Re: Economics discussion panel
« Reply #35 on: September 10, 2007, 12:41:00 pm »

Yeah, inflation. What i meant was that there is no one in the DF universe who tracks inflation and spreads that information around, because currency in general is localized per town and per fortress. Thus no globam economy.

Say you dug up a lot of platinum and made a billion coins out of it, the humans you trade with will see you as filthy rich, they will not know or care that the coins you give them are worth less because there are so many in circulation.

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Felix the Cat

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Re: Economics discussion panel
« Reply #36 on: September 10, 2007, 10:05:00 pm »

quote:
Originally posted by Tamren:
<STRONG>Yeah, inflation. What i meant was that there is no one in the DF universe who tracks inflation and spreads that information around, because currency in general is localized per town and per fortress. Thus no globam economy.

I'm talking about localized inflation.

quote:
Say you dug up a lot of platinum and made a billion coins out of it, the humans you trade with will see you as filthy rich, they will not know or care that the coins you give them are worth less because there are so many in circulation.</STRONG>

Perhaps. Global economy is on the way, yes? As a temporary fix, make traders respect the value of goods in your fortress.

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Tamren

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Re: Economics discussion panel
« Reply #37 on: September 10, 2007, 11:07:00 pm »

ah, was in a hurry when i read that the first time.

So how would we deal with it, and whos job would it be to track such things?

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Felix the Cat

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Re: Economics discussion panel
« Reply #38 on: September 11, 2007, 03:05:00 pm »

quote:
Originally posted by Tamren:
<STRONG>ah, was in a hurry when i read that the first time.

So how would we deal with it, and whos job would it be to track such things?</STRONG>


Hmm.

I guess something like this.

Every type of object has:
-An intrinsic value. This is what it's worth as compared to other things in a completely sanitized system. A table is intrinsically worth more than a mini-forge. This is what is used as a starting point in calculating its real value.

-A rarity value. This is dynamically calculated from the number of that type of object in the fortress. (Supply)

-A desire value. This is dynamically calculated from the number of dwarves in the fortress who especially want to own that object. (Demand)

-A market value. This is still in abstract units, as we haven't figured out the value of money yet. It is calculated as:
market value [is proportional to] intrinsic value * (desire value/rarity value)

The total market value of everything in the fortress is then calculated. This is the "perfect money total", as each item would be worth its market value in money if there were exactly that much money in the fortress. This value would not be displayed to the player, and it is not intended to be an aim or goal for the player to achieve.

The actual amount of money in the fortress is then divided by the perfect money total to find the "price scale factor".

The market value of each object is then multiplied by the price scale factor to find its actual price.

This might add a use for the treasurer; he can give you the inflation rate and other figures.

This system is nice because it's modular. There's a set of values for each object, and then a set of values for all of the possible modifiers to the object - quality, encrusted, used, etc. Objects extend to rooms, workshops, and labors as well.

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Tamren

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Re: Economics discussion panel
« Reply #39 on: September 11, 2007, 03:47:00 pm »

That sounds good. One other thing that might help is giving certain nobles limited control over some prices. Say for example you appointed a "head mason", he would be a sort of union boss for all of the masons in your fortress.

If he saw that demand for a product was way down, or that there was a surplus he could alter the prices temporarily to make up for that.

Once more advanced shops go in, they would probably be actively supplied by your workshops instead of just selling random crap that is lying around. The shopkeepers would modify the price of merchandise in the shop as they see fit, but the head mason has overall control of the price of say, tables.

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Felix the Cat

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Re: Economics discussion panel
« Reply #40 on: September 11, 2007, 05:06:00 pm »

quote:
Originally posted by Tamren:
<STRONG>That sounds good. One other thing that might help is giving certain nobles limited control over some prices. Say for example you appointed a "head mason", he would be a sort of union boss for all of the masons in your fortress.

If he saw that demand for a product was way down, or that there was a surplus he could alter the prices temporarily to make up for that.

Once more advanced shops go in, they would probably be actively supplied by your workshops instead of just selling random crap that is lying around. The shopkeepers would modify the price of merchandise in the shop as they see fit, but the head mason has overall control of the price of say, tables.</STRONG>


I agree, and I also think the current system of nobles modifying prices and wages according to their whims should stay in. IIRC there's a couple of bloats about expanding this as well.

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Athmos

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Re: Economics discussion panel
« Reply #41 on: September 12, 2007, 11:58:00 am »

well IRL, for a very long time almost any currency could be used anywhere : the value of the coins was the value of the metal inside (or supposedly inside).

The real difference would come from something else entirely : fake coin, etc. But mostly, the value of a gold coin, or a copper one, or a silver one, was the value of the metal itself; where it had been minted didn't account for much, but the fact i could have been filed to get some of the metal off did; that's why most importatn transaction were made by weighting the coins, and trying to make sure they were really made of what they seemed to be made.

Athmos

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irmo

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Re: Economics discussion panel
« Reply #42 on: September 12, 2007, 07:57:00 pm »

Many of these suggestions are interesting, but assume an economic structure that doesn't make a lot of sense for the fortress.

First, you're in the middle of nowhere.  This makes for a self-contained economy.  The dwarves aren't getting paid so that they can go down the street to Safeway and buy groceries.  They're getting paid, in fortress funny money, so that they can buy stuff from the fortress.  This money is created out of nowhere when they get paid, and vanishes when it's spent.  So the only place "inflation" can occur is in the personal accounts of dwarves, and it would have to involve dwarves doing lots of highly paid jobs (thus accumulating money) in the face of a fortress-wide shortage of goods.  The problem there is the shortage, not the inflation.

Second, since there is no "fortress treasury", taxation is pointless.  Money, again, is created out of nowhere.  This isn't inflationary because it's flowing out at a rate roughly equal to the production of goods.  (The fortress might have to pay taxes to the king at some point, but that's a separate issue.)

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Felix the Cat

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Re: Economics discussion panel
« Reply #43 on: September 12, 2007, 09:53:00 pm »

I think the point is that all of that could/should/would change with a more detailed economic system.

The dwarves should get paid for their work so that they can go buy essentials and luxuries. The money shouldn't magically appear when they get paid and magically disappear when they spend it. When they get paid, the money should move from the employer (fortress or other dwarf) to the employee; when it is spent, it should move from the buyer to the seller. There should be a fortress treasury that stores all of the money that is the property of the fortress as a whole (or property of whoever you imagine the player to be - the Mayor/Baron/King, the "government", the "will of the dwarves", the "power behind the throne", whatever). The amount of money and amount of goods in the fortress should affect the fortress economy. Later on down the Economy/Trade Arc, the economy of the fortress should be tied into the world economy.

Also, Athmos: as was discussed elsewhere, the value of coins was very much based on the coin's mint marking. The mint marking was an assurance that the coin contained a known value of some metal, that the coin contained the same value of that metal as other coins with the same mark, and that the coin would be accepted by others as containing that value within the area that recognizes that mint mark. In the Roman Empire, Caesar's visage on a coin meant that it was worth something. A coin from, say, Nubia would have been of questionable value in, say, Gaul - it would have to be measured and tested for content by a professional goldsmith in the presence of both buyer and seller at a market, and such measurement would have cost money. That's why moneychangers were common in areas on the periphery of the Empire - attested to by the Bible (Jesus throwing the moneychangers out of the temple). They would know the worth of all sorts of coins and would be able to give you coins that would be useful to you.

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Nil Eyeglazed

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Re: Economics discussion panel
« Reply #44 on: September 13, 2007, 01:04:00 pm »

I know the new release is soon, and you're all burning with one single question: What does some guy on the internet think should be changed with the economy?  Never fear, I am here to sate your curiousity.

Let's revisit how the economy works.  I'm not certain, but I surmise:

1) The State is considered to own everything on the map.

2) The State issues imaginary payments to dwarves for transforming resources into higher valued resources.  Nobles would prefer if those imaginary resources were represented by physical markers like coins, but they'll settle for bookkeeping if they have to.

3) Shopkeepers redistribute wealth by purchasing items from the State and selling them at markup to individual dwarves.  Shops periodically issue low priority shopping tasks (ie, tasks that flash relatively infrequently).

4) The State owns all space as well.  It rents private spaces to individual dwarves for their needs, but provides public assistance to dwarves in need via barracks.  I am totally clueless about how dwarves (or the State) choose individual tenants, but when tenants cannot pay, they are evicted.

As a gamer, I'm happy with this general model.  I don't expect modern capitalism, and the transformation from pre-economy communalism seems appropriate.  However, I think that the economy should be something seen as a benefit, not as a curse.  I think the economy should free the gamer from micromanagement of dwarf happiness (and of more, as you might agree if you bother to read what should be a mammoth of a post on the second page of an old thread.)  I'm dividing this into easy, hard, and long-term implementations.

EASY:

Shops flash management tasks that can only be accepted by the individual shopkeeper.  In each management task, the shopkeeper visits the shop and reduces prices on any items that have been unsold since the last management task.  This price reduction works as a noble price adjustment: it affects all shops.  It also works on two levels: the level of materials, and the level of object.  If a shopkeeper revisits a shop to find an onyx ring unsold, it will reduce the price of onyx items by a certain percentage, and it will reduce the price of rings by a certain percentage.  The exact percentages require a bit of playtesting, but any low value will do-- lower adjustments will just slow adjustment.  They should be modifiable values in init.  If the shopkeeper returns to find all items unsold, the shopkeeper should proceed to refuse the cheapest item placed in the shop.  If the shopkeeper returns to find an item sold, it should adjust prices on the material and object that was sold up.  This number should be lower than the adjustment down, but it doesn't really matter how much lower, as long as it exists.  Ideally, this is also a time for the shopkeeper to purchase items to refill the shop's inventory, and haul them to the shop.

As long as priority of shopping tasks is low enough, purchasers can continue to be affected by shopping tasks initiated by shops.  There is a danger that distant shops will not be patronized, however.  When a shopper visits a shop, the shopper should compare each item's current cost to a modified absolute cost.  The modified absolute cost is made up of absolute value (ie, value you could sell to a foreign merchant) modified by individual preferences.  I doubt that current preferences have scale, but they easily could.  I suspect that preferences could lead to +25% (or minus!) to an item's value.  With multiple detailed items, this could stack.  If a shopper found that he valued an item at higher than its cost, he would attempt to purchase the item sold with the highest discrepancy-- if he had the money.  If not, he would look at the item with the next highest discrepancy.  He would attempt to buy all items that he valued higher than the shopkeeper, if he had the money.  When he had no money to purchase any items that he valued more than the shopkeeper, he would quit shopping.  He would then transport all items to one of his rooms.  Ownership of multiple items should also reduce cost.  Even if a dwarf likes earrings, he doesn't ALWAYS buy them in preference to amulets.  Each item a dwarf owns should reduce his valuation of similar goods of the same type by a certain, cumulative amount-- say 10%.  Second coffer is only 90% as valuable as the first, third only 81% as the first, etc.

Rentals would be treated as shopping tasks initiated from a noble (or a noble's room, if that is easier, or a new shop, if necessary).  It would be treated like an item to be purchased.  A dwarf would compare his current living situation discrepancy (perceived value minus actual cost) to each bedroom available.  He would pick the largest discrepancy that he could afford.  For EASY, I would suggest relinquishing ownership on previous rooms each time a room is bought (and so including current room value discrepancy in the list of rentals, to prevent see-sawing between the two best deals).  A change in residence would generate hauling tasks that could only be answered by the moving dwarf (or, in the longer term, that would be PAID FOR by the moving dwarf).  Although rentals would be automatically deducted each period, I would recommend not evicting a dwarf until his account was greater than negative the cost of the room.  This would preserve some permanency even for this large periodic cost.  That could be adjusted based on rate of shopping and rental tasks.  The bedroom of an evicted dwarf should generate hauling tasks to his new room that can only be answered by the Sheriff (maybe, at least-- haulers might be okay).   Items could be placed in barracks.  A noble in charge of bedrooms, or a real estate agent, would periodically revisit real estate like shopkeepers revisit their shops, and change costs based on living space, component items like doors, and engraving status.  As with shopkeepers, sold rooms should adjust prices of the same upward.  As there are a variable number of factors, adjustments could be controlled by rooting to the power of the number of factors involved.  A dwarf without floorspace should increase valuation of floorspace in rentals.  This will encourage container purchases (see below) and automagically maintain appropriate bedroom sizes.

Easy!  Now you have a self adjusting economy!  In-demand items remain in-demand, but prices will eventually drop to accommodate all dwarves-- or raise to maintain subtle differences in standard of living.

HARD:

These aren't all necessarily hard, but they do all involve changes in gameplay, and have to be rebalanced against other factors.

New shops: Reduce military micromanagement, and improve consistency with Adventure mode.  Weapon shops and armor shops.  If your champion likes copper, well he'll wear copper.  Tough titty.  You will also end up with a more historically accurate military picture.  Soldiers don't wear masterpieces-- rich people do.

Furniture shops: Seperate section because it requires more work.  Reduce micro-ing of furniture.  Dwarves replace beds, place coffers and cabinets.  Pay no attention to dwarven preferences, because dwarves will pay attention for you.  And hope you have some diversity, or prices on onyx will skyrocket.  For now, bags should be exempt from ownership.

Credit: It's absurd that the bookkeeper ties you to coins.  In reality, bookkeepers free you from coins.  Abstract accounts (those not represented by concrete coins) should be incapable of purchase until a certain noble is attained.  If the bookkeeper remains to start the economy, then it could be the hoardmaster, or the treasurer.

LONG-TERM:

Redesignation of shops as stockpile-type areas:  Improve symmetry with adventure mode, and make more interesting fortresses.  Designate a shop stockpile.  Ideally, a shop would task a shopkeeper to collect a display (container or table), then to collect goods.  And you get to make interestingly shaped merchant districts.  Eventually, all stockpiles should be shops, with expenses compensated-- plant a plot, the govt will pay for your labor, and for the cost of the seed.  Requiring upfront expenditure by laborers is dangerous, but interesting.

Other needs as purchased goods: Food is dangerous, but making it a purchased good should be doable (with a LOT of tuning).  They can always hunt for vermin, right?  Same goes for booze.  This allows restaurants, grocery stores, bars.

Leisure as a function of income: Breaks should depend on income.  If you have a bigger account, you will take a longer break.  What do you need money for?  Bridges nobles and peasants, and complicates income management.  Ideally, breaks should cover all non-work needs: partying, shopping, etc.  Dwarves on break should evaluate other jobs, but be likely to cancel them based on expected wage.  Your ultra-rich legendary weaponsmith has hauling enabled?  If you need a weapon, let him know; otherwise, party hard, my friend, party hard.

Hourly wage: Establish expected lengths of tasks (by observation, if needed) and establish payment per time spent, not per task.  If a hauling task takes 1 day on average and pays 24*, instead pay hauling at 1* per hour.

Summer rooms: Why not allow multiple rooms?  Apply a -10% worth modifier to a second room the same way you apply it to a second coffer, and maybe your richest dwarves want two bedrooms.  So it shoves your haulers into the barracks?  Tough, man.  Learn a trade.

POTENTIAL PROBLEMS:

Coin bloat: The more important you make the economy, the more you exacerbate coin bloat.  A credit noble, as suggested above, is insufficient to control coin bloat.  Item restacking is important for other objects as well; it has to go in sometime.  It will mostly cure coin bloat.  The consideration of purses (or wallets, or pockets, or whatever) will help as well.

Legendaries and Nobles: They claim EVERYTHING.  They take what they want.  They never sell.  That, umm, complicates economies.

Weird items: Eventually, shops should replace stockpiles.  All items should be for sale.  A mason should buy stones from the Miner shop.  An architect should buy blocks from the Mason shop.  But what about end-products?  Who has any reason to buy a commissioned huge corkscrew that you never wanted to turn into a trap?

Happiness: The point of getting that onyx earring has always just been happiness-- but happiness is broken.  When we have numbers like +1000 and +10 that exist side by side, it's clear that happiness is a careful balance that has not yet been attained.

Global economies: Foreign merchants are too easy to buy out.  We use them to get rid of crap, not to get something that we want.  That doesn't make any sense.  If a good balance was achieved, seizing would occur strategically, not just for fun, and currency interchange would become meaningful.

Okay, I'm forgetting about a billion things, but that's long enough for now.

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