Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[jseah]

^AngleWyrm, and that gets screwy when you consider that in DF (and real life), it is possible to have more goods than gold lying around.  So you need more coins to trade the goods.  Which causes a gap between the amount of coins and gold, opening the possiblity of a run and the government unable to keep the promise of gold -> coins. 

[AngleWyrm]

^AngleWyrm, and that gets screwy when you consider that in DF (and real life), it is possible to have more goods than gold lying around.  So you need more coins to trade the goods.  Which causes a gap between the amount of coins and gold, opening the possiblity of a run and the government unable to keep the promise of gold -> coins. 

I agree with the premise that it is possible to have more goods than gold, but I disagree with  the proposed solution of creating a gap between coins and gold. If coins ARE gold, there is no such thing as a gap, and there is also no trickery about a promise.

Example: 2-person micro-economy,
You sell Stuff, I sell Supplies, and we each have ten bucks. One day I come over and buy some of your stuff for ten dollars. Around lunchtime you buy some of my supplies for ten bucks to make more stuff. And that afternoon I come back and buy more stuff for ten bucks. So even though there was only ever twenty bucks between us, we have still made thirty dollars worth of activity.

[NW_Kohaku]

Some thoughts on Dorf Economic Modelling

Don't model the economy after "real life." In real life the banks mint new dollars every time someone deposits a dollar in the bank. This should be shocking to the point of disbelief, because it means that a single dollar becomes a smaller fraction of the total dollars every day. In theory, we would be on a constant inflation track until the purchasing power of a buck is less than the paper it's printed on. In reality this has already happened several times, and will continue to happen. For example, the US penny was stripped of it's copper content when it became apparent that a penny's copper traded for more than a penny. Same with the nickel Nickel, the silver Dime, and the silver Quarter and Dollar.

Use a Gold Standard. Reconnect the worth of material to Dorfbucks. 100 Dorfbucks -> 1 Gold bar, and 1 Gold bar -> 100 Dorfbucks. It is important that this is a lossless exchange, with no percentage charges or fees for service. In order for 100 Dorfbucks to be WORTH 1 Gold bar, it must take exactly 100 Dorf bucks to make a Gold bar, and visa versa. (Note that it could be 10 bucks, or platinum, or anything else, but it has to be stationary for the whole game timeline). Then it can be seen that minting new coins will do no harm, because they are just as easily converted back to metal bars. A person can hold many metal bars worth of bucks in their private reserve, or they could have a stack of metal bars. Doesn't really matter.

The hard part: Service Value. I am of a mind that 'Money' is an overly-generic concept that covers at least two forms of exchange. The first is the transfer of materials, usually a trade of materials. I give one gold bar and I get 1 stack of <something else I want>. The other part is as merit for service to King and Country. I go to work to serve my fellow man, the paycheck is a proof of service I can use to get served by my fellow man.

If tokens for service were separated from material wealth, we could probably explore a much better form of economic model.

You shall not press down upon the brow of dwarves this crown of thorns, you shall not crucify dwarfkind upon a cross of gold!

... sorry, I just felt a sudden urge to shout that when reading all this.

But seriously, the value of gold in real life remains very stable because of the fact that the world supply of gold remains very stable - thanks to its percieved value throughout the ages, virtually every deposit of gold in the world has been mined out, leaving only very trace deposits that have to be processed with things like seep-leach processing using arsenic to dissolve the extremely trace amounts of gold.

In dwarf fortress, if this is used to determine the economy, then when you first start a fortress, you might have only a few bars of gold that you traded for, making gold so valuable as to make barter trading preferable to actual coinage, because the coins would be so valuable.  Once you struck a vein of gold or two, however, you would suddenly be overwhelmed with out-of-control inflation as the gold supply in the economy tripled overnight.

This doesn't even start to cover the differences in values of items on the internal economy with the global economy.  If rampant inflation caused by focusing on mining precious metals, and a lack of concern for farming or textiles has made a sock worth 5 bars of gold inside your fortress, how are you going to trade your plentiful gold coins with the outside world?

[stuntedkind]

A compromise position would be to base fort prices on parent civ availabilty in combination with fort availability. So your gold value won't change significantly so long as your parent civ has a lot more than you can mine/recieve in trade.

[NW_Kohaku]

That would just mean that people with low amounts of coins would just have a given value for items based on the coins in their mountainhomes, regardless of if they have a very small amount of coins... And you could simply mint huge numbers of coins with only a mitigated effect on inflation.

... Of course, it would be nice if dwarves just migrated with money in their pockets already...

[AngleWyrm]

A sleight change from the Gold Standard, as used in real life: Just because 100 dorfbucks trades for a bar of gold does not mean that the economy has to be linked directly to gold. It could be anything that has a fixed price for all time. It could be something very cheap, like maybe 3 dorfbucks is defined as 1 non-economic stone.

Then the price of everything else can vary, based on supply and demand.

[The Architect]

Gold was chosen because it was scarce. When gold ceased to be scarce (for example, Spain during the South American gold rush) its value dropped. There's no such thing as a commodity whose value is fixed for all time (except perhaps adamantine in DF) and you certainly can't use something whose availability can be arbitrarily increased at any time like raw stone.

[NW_Kohaku]

Gold was chosen because it was scarce. When gold ceased to be scarce (for example, Spain during the South American gold rush) its value dropped. There's no such thing as a commodity whose value is fixed for all time (except perhaps adamantine in DF) and you certainly can't use something whose availability can be arbitrarily increased at any time like raw stone.

Technically, gold was valued because the ancients believed it had magical powers.  (And the Latin word for gold was basically the same word as "soul".)

Likewise, you can have a money supply that you can raise arbitrarily whenever the government wants to... it's just a modern paper-money economy at that point, however.  Putting the value of your currency on the number of rocks you have mined is basically just a more complex way of shoving the exact same thing as a paper currency model out the door.

[The Architect]

It would be unwise to base a sweeping statement about the value of a commodity nearly worldwide on one culture's perception of it, and it's also irrelevant.

The point is that there is no such thing as a commodity with a permanent scarcity or demand, and thus there is no such thing as this:

It could be anything that has a fixed price for all time.

I think the author's intent might bear closer inspection than I originally gave his statement. There's no reason a commodity couldn't be given a set price to which everything else is measured within the game, regardless of realism.

[Xveers]

One thing that occured to me is a way that might make money AKA coinage a bit more useful and sane (and non-gamebreaking than before) is to make coinage somewhat abstracted instead of having them as items that dwarves can hold and hoard.

Spoiler (click to show/hide)

Dwarves internally still have a counter that tracks their money/debt, but you have three new global variables, Optimal Money Supply, Actual Money Supply and Money Liquidity. The first is calculated via some mechanic that takes into account population and relative "earning" based on their assigned profession, perhaps. The second is the actual total amount dwarfbucks actually minted and in the economy, and the third is a variable that compares the amount of coins available versus the total money supply.

The ratio between the first and the second gives you an inflation/deflationary adjustment to prices of your fort (you can't just mint more coins!). The third number (liquidity) offers an additional adjustment based on how much currency is actually useful IE if you only mint adamantine coins, then everything is going to be insanely expensive since that's all that someone can pay with (gives reasons to mint lower value coins like copper or lead).

The coins themselves are stored in a new stockpile tagged as a "Vault" (new target for kobold thieves?) with their actual movement of "currency" being handled invisibly without the actual movement of coins...

Just a thought I had.

I like your last idea, but not the others.  The vast amount of coins should be in the vault or hoard, with smaller 'personal hoards' being designated by the player inside set containers.
Now, here's the big idea:

All transactions happen instantaneously.

Responding to comment about the earlier ideas I made. The idea was to do two simultanious things to the money supply.  The first is to have some level of inflation based on pumping too much money into the supply (AKA giving you Weimar Germany / Zimbabwe inflation, where stuff ends up costing more just because there's so MUCH money in circulation), and the second one with the total coin count VS total coin value was to prevent a player from say minting twenty adamantium coins and calling it a day. If someone did, then prices would skyrocket since the entire "economy" would revolve around whoever has said coin(s). If the smallest unit of currency IRL is a $20 bill for example, you won't see much stuff for sale at $15.

As far as coin "value" is concerned, I was thinking of just using the intrinsic material value as a basic value, with quality perhaps functioning as a modifier, just one that didn't quite have so high a span of multiplier values (as the primary value of the coin is the material and not the workmanship for our model). Thus one could "mint" coins from a variety of metals, giving new value for some of the non-economic metals like rose gold (for example), since ideally a player will have steel production and thus be making more durable goods from said steel.

Anyhow, more ideas into the pot!

[NW_Kohaku]

To reinforce Xveers's statements...

One of the problems that the CIA was having in the middle east for the past seven years was that they would often bring briefcases filled with $100 bills to effectively bribe people into giving them information.

Without any real means of exchange, having nothing but a glut of $100s caused problems.  Coffee shops would sell coffee for some small amount of local currency, or coffee for $100, because there was no change smaller than $100.

This forced the CIA to start bringing in literal semis filled with nothing but $1s and $5s to start bribing people for information, just to try to normalize the money supply.

[Silverionmox]

The relative value of goods and services fluctuates with supply and demand. We could pick anything as the yardstick to measure everything else with. However, that exercise has been done already in History, and several solutions have been found:

- express values in grams of gold. Advantage: gold is commonly used as a store of value and hence it's very easy (read: somewhat possible) to translate prices into gold. Disadvantage: supply fluctuations mess things up. Since resource extraction is a major feature of the game, we can't use that.

- express values in basic food, usually grain. Advantage: usually grains are the staple food and they are commonly used, so it's easy to determine relative values. Disadvantage: even basic foodstuffs can fluctuate wildly in value, in case of famine for example.

- express values in hours of labour. While the value of labour may seems arbitrary and highly variable, over the centuries its the one commodity that's always valued the same by people, because supply and demand are always balanced: everyone has 24 hours in a day. For example, the services of a prostitute (which do not require other resources that may distort the pricing) have remained remarkably stable throughout the centuries at an average price of a day's labour.

So as the underlying mechanical value, the game probably will run the best by using hours worked as a basic measure of value. That way, it will be possible to compare between civs and groups that have no contact or are just not trading, or using completely different currencies.

[NW_Kohaku]

- express values in hours of labour. While the value of labour may seems arbitrary and highly variable, over the centuries its the one commodity that's always valued the same by people, because supply and demand are always balanced: everyone has 24 hours in a day. For example, the services of a prostitute (which do not require other resources that may distort the pricing) have remained remarkably stable throughout the centuries at an average price of a day's labour.

So as the underlying mechanical value, the game probably will run the best by using hours worked as a basic measure of value. That way, it will be possible to compare between civs and groups that have no contact or are just not trading, or using completely different currencies.

I love how this is a reasoned backdoor argument for getting Toady to code in prostitution... PURELY FOR ECONOMIC REASONS, I ASSURE YOU.

Anyway, maybe it would be best to just have "The Dwarfbuck Standard".  Where DBs have an arbitrary, unchanging value, but are not actually put into the game.  Dwarves who perform labor recieve DB payment as they do now, and prices are a function of supply and demand relative to the total amount of DBs in the fortress as a whole.

Prices in real life, ultimately, are something of a matter of bidding.  The price of food will go up until only the richest can afford to eat if there is a food shortage, and that food would probably force them to spend almost everything they have, because they will only be able to afford the food if they can outbid everyone else who wants it that is willing to buy it.  People have priorities, however, and to properly model demand, there should be less of a fluctuation on something like, say, a puzzlebox, which very few people will pay absurd amounts to have, since it provides little practical benefit.

Of course, for game calculation speed purposes, you can't have bidding wars for every single product...

[The Architect]

I think an ancient economic model is the best idea. We should take into account the unequal value of the labor of individuals, of course. Toady's current system, in which the dwarves are paid out of a credit system made good by the assets of the government, is probably the most solid and scientifically sound system that can exist. I think the flaws in it are really simple programming flaws, with a very small number of actual conceptual problems.

The reason for my position is that it is not subject to the corruption of a real government run by human beings. Favoritism, greed, deception, and just about any other corruptive vice present in a real society would render such a system highly impractical. In an ideal world, such a system would be truly perfect and suffer from no inflation or vice, and a free market would ensure a balanced distribution of goods given free will to take initiative and fill market gaps on the principle of earning profit for your labor.

In the end, I think we come upon two very important issues:
1) DF is a socialist or communist world, in which an authoritarian power dictates the jobs available, the work permissions, etc. There's no place for any kind of freeflowing economy based on supply, demand, etc.
2) A realistic, modernized, or complex economic system given the conditions above
   A) serves no practical purpose beyond providing bragging rights about our beloved DF,
   B) would be incredibly convoluted and difficult to create,
   C) and thus logically is nothing but a burden to the programmer, processor/game speed, and players.

I really think that's about all there is to be said on the subject: The simpler, the better. If dwarves work, then they eat, drink, and sleep in relative (to their industry) comfort. When our options for society become more complex, then a more advanced economic model might have a real place in DF.

However, for those simply interested in economics and its possible applications in DF, it's still fun to discuss, dispute, and theorize. I'm just being intensely practical, and felt the need to point out the practicalities. Also, a need to point out that logically speaking, implementing a complex economy in DF as it now exists would be in fact a very undesirable thing.

[NW_Kohaku]

stuff

Of course, all this assumes that the economy is supposed to help the player in some way. 

I always saw the economy as a sort of penalty, or an incriment on the difficulty level, and that's why Toady waits until 80 pop (an established, self-sustaining fortress is practically guaranteed by that point) to spring it on you.