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[Granite26]

Personally I dislike the riffraff buying overly expensive goods. Gold, platinum etc goods should be the realm of nobles and perhaps legendaries if they're ever made less mundane

I disagree, dwarven culture is mineral rich AND it values minerals.  Ergo everyone has a lot of valuable gold items.  (Much like IPods, Cell Phones, Digital Cameras and other electronic devices today)

[Pilsu]

I disagree, dwarven culture is mineral rich AND it values minerals.  Ergo everyone has a lot of valuable gold items.  (Much like IPods, Cell Phones, Digital Cameras and other electronic devices today)

Everyone wearing the best stuff available makes it rather meaningless. Limiting the lower caste to lesser metals encrusted with lesser gems would actually give them a valid use. As is, there's little reason to make anything out of lesser materials. Other than the nonsensical mandates. Judging by the nobles going berserk because a peasant has a better room than they do, Toady intends them to be self absorbed pricks so it'd rather fit

[korora]

If the economy is balanced that'll happen naturally and organically. No need to hardcode it or any such nonsense. You can always make sure the "riffraff" don't make enough money to buy expensive objects.

Also, don't forget the big lesson of the times: the free market doesn't always work. Some means of government interaction with the economy would be necessary.

[Granite26]

Also, don't forget the big lesson of the times: the free market doesn't always work. Some means of government interaction with the economy would be necessary.

Careful... There are quite a few people who think that it was government involvement that started this in the first place... (and quite a few more that don't think a falling from artificial highs is a failure so much as a correction).  Not trying to start a debate, just... be careful what you state as fact.

Everyone wearing the best stuff available makes it rather meaningless. Limiting the lower caste to lesser metals encrusted with lesser gems would actually give them a valid use. As is, there's little reason to make anything out of lesser materials. Other than the nonsensical mandates. Judging by the nobles going berserk because a peasant has a better room than they do, Toady intends them to be self absorbed pricks so it'd rather fit

There's nothing innately 'better' about gold mugs than tin.  If you are in a world with massive amounts of gold and no tin, then tin should be the valuable, 'noble' metal.  Don't conflate poor rarity balance in vanilla with poor valuation.  The flaw (as you put it) is the arbitrary max value/quality structure.

Also, for trade, we are still dealing with an extremely microcosmic economy.  Anything you get, you get in spades.  Think about the future when all the silver doesn't stay in the silver mine, but instead shipped back to Spain... 

[korora]

OK, fair enough; let me back off on that point.  Whether you attribute the current interesting times to too much regulation, too little, or something else, I think it's fairly widely believed by economists that a market solution is not always optimal.  See this Wikipedia article for more.

Of course, government interaction is vital for gameplay, so the above may be irrelevant.  If you can't interact with the economy then there's less game.

[TrombonistAndrew]

Indeed, government interaction is pretty much mandatory the way the game is set up. Government interacts by (DF language):

creating coins
creating work lists in shops
buying and selling items from caravans
arbitrarily claiming and/or unclaiming items
taxes
setting minimum and/or maximum wages

The economics will only affect items being sought by dwarves which are available at the time. Thus, the richer dwarves will be the only ones who happen to get the two rope reed caps you made if cloth headgear is in short supply. And if you make available 100 giant cave spider silk tunics and only have 80 dwarves, all of them should be able to afford one, assuming you don't plan on selling them to a caravan.

Just because free markets can be volatile is no reason NOT to use it in a game. DF is supposed to not be too easy, yes? Balancing a good free market requires strategy. The beauty of DF as is already built is that it would require very few additional game management mechanics. Of the list I wrote, the last two which the game (mostly) doesn't do yet are EASY to implement.

And remember that item prices in your fortress are NOT going to be the same as item prices from caravans. Thus, some items in your fortress which may suddenly be getting underpriced may be excellent candidates for caravan trading. Vice-versa for overpriced items; they could be things yo may want to buy from caravans to balance things out. Or make via more workshops/laborers.

[Pilsu]

There's nothing innately 'better' about gold mugs than tin.  If you are in a world with massive amounts of gold and no tin, then tin should be the valuable, 'noble' metal.  Don't conflate poor rarity balance in vanilla with poor valuation.  The flaw (as you put it) is the arbitrary max value/quality structure.

It isn't a matter of whether gold is innately better than tin. The prices are already defined by the culture, for instance aluminum is more expensive than gold. Steel is also rather exclusive. The fact nobles tantrum because a peasant has a better room is also indicative that nobles and high class citizens are privileged. It should be reflected in their possessions

Hmm, I think you're right. Sort of. The haulers can't afford rooms as is, I see no reason why they'd suddenly have a massive boost in income if the rooms became affordable and start buying diamond encrusted gold amulets. It's the middle class that's the problem, the crafters that never quite reach legendary status in my vision but still crank out crap all day. They'd be as privileged as the nobles are simply because the player is cranking out clothes, stone mugs and glass continuously and wages are paid by tasks completed. I dislike certain professions paying better because the materials are practically infinite like plants, sand and green glass gems

[Mikademus]

Also, don't forget the big lesson of the times: the free market doesn't always work. Some means of government interaction with the economy would be necessary.

Careful... There are quite a few people who think that it was government involvement that started this in the first place... (and quite a few more that don't think a falling from artificial highs is a failure so much as a correction).  Not trying to start a debate, just... be careful what you state as fact.

There were influential economists promoting that idea. They all changed their mind after the stupendous fiasco of the "chock therapy" of former Soviet. Anyone promoting ideas like that today are either naive ideologues, populists wooing that segment, or people with an agenda that believe they would end up on top. Fact: the most stable capitalistic first world economies have the highest degree of government intervention (f.i. Scandinavia, Germany), while the most free market (USA) has the world's highest budget deficit.

Point is that highly deregulated economies doesn't work if the measurement for "working" is financial stability, controllable negative externalities and low social stratification.

[Granite26]

1:  Who says stability is a merit?
2:  I think social stratification is not what you mean, you probably want Economic inequality  The United States does have a higher Gini Index than the countries you site 1, if you go in for that sort of thing
3:  Don't confuse a corrupt political system catering to special interests as a failure to control externalities.  There are very efficient and fair means to charge for them within a free market model.  The US just doesn't...

Finally you're comparing apples to oranges.  Stable, sure, but the GDP per capita is 30% higher in the US than both Germany and Sweden   The budget deficit is a different matter all together. 

[Mikademus]

Thanks for providing more suitable terminology (economic inequality). The links will be useful for the microscopic chance that anyone becomes interested enough from watching this internet fight to actually look up what's discussed.

Finally you're comparing apples to oranges.  Stable, sure, but the GDP per capita is 30% higher in the US than both Germany and Sweden   The budget deficit is a different matter all together. 

This is taking the thread off a tangent, but (1) depending on what you're measuring GDP per capita in meaningless unless taking the distribution of income into account, and (2) an average US citizen wanting the level of social services that Scandinavians take for granted pays for insurances an amount that puts their net disposable income on the level with or even beneath that of the Scandinavians (it's been perhaps two years since I last read the statistics though, so caveat emptor). That does not take child care fees and tuitions into account which would even further shift the numbers in favour of the Nordic countries.

Edit:

In a bout of extreme boredom I actually double-checked your figures with your own source (CIA's World Factbook), and you misrepresented them. The Swedish GDP per capita is 81% of the US, and the German is 75% (that is 19% and 25% less [1.216 and 1.343], respectively), which is significantly different from your claim of 30% for both. Those were 2007 figures, to boot, and something tells me that 2008 figures would be a bleaker read for the US.

[Silverionmox]

To be fair, he said 30% higher which would be correct. Let's bear in mind that the GDP also registers prisons expenditures, weapon manufacturing and the cleanup of car accidents as positives.
A higher Gini index means a greater inequality; to add insult to injury, social mobility is also larger in the Nordic countries. Rags to riches happens almost twice as often in Denmark.

Running an efficient free market requires heavy government intervention, paradoxically.

For DF, I think the most practical solution would be to balance demands with a market system, keeping supply under the player's control. That's more or less how it is now, but with prices of labour and goods under player control. The dwarves would then buy what they like (and it's best to let them buy and place their furniture too), and if something is lacking they would go to the relevant guildmaster and request it. Those guildmasters then give you a nice report about the needs of the community.
Additionally, keep a marketplace where foreign merchants can sell their goods privately. These would be only consumer goods; the raw materials trade would remain under player control (including semi-finished products like cloth).

[Granite26]

I don't like to make claims without sourcing them.  It's a credibility thing when telling people they're wrong.

[Impaler[WrG]]

My stance is to allow the player to choose the degree of government (aka the nobles) control though the settings of various nobles much like the record keeper accuracy setting.  A wide variety of socio-economic structures could thus be simulated in the game from almost pure communism to an unregulated free market.

[Foa]

All I just want are the nobles to stop embargoing my merchants!

[TrombonistAndrew]

My stance is to allow the player to choose the degree of government (aka the nobles) control though the settings of various nobles much like the record keeper accuracy setting.  A wide variety of socio-economic structures could thus be simulated in the game from almost pure communism to an unregulated free market.

Hear, hear!

For DF, I think the most practical solution would be to balance demands with a market system, keeping supply under the player's control. That's more or less how it is now, but with prices of labour and goods under player control. The dwarves would then buy what they like (and it's best to let them buy and place their furniture too), and if something is lacking they would go to the relevant guildmaster and request it. Those guildmasters then give you a nice report about the needs of the community.
Additionally, keep a marketplace where foreign merchants can sell their goods privately. These would be only consumer goods; the raw materials trade would remain under player control (including semi-finished products like cloth).

Prices of labor (as I understand it, at least) is not under player control, but price of goods indirectly would be. You just adjust supply, and prices adjust.

Good idea about guildmasters. Like another specific kind of noble, yes?

Concerning a foreign merchant marketplace, that's an interesting idea: foreign merchants buy and sell directly to your dwarves, instead of letting the player have control over all aspects of foreign trading. And agreed, there should still be an option for the player to draw government money and goods for trade to get critical raw materials which one needs. Once the caravan arc gets going, Toady may be planning this anyway. To be precise, if this is the plan, caravans would have to predict prices based on the supply/demand of items in their next stop(s).