Business And Economy Archive
Thread: Inflation horrible no money sinks in this game
Epsilon125 wrote:
"So to keep up with demand AS's have to raise prices to reduce demand to a level that is sane."
Written like a true crafter trying torationalize maximizing prices. Charging prices that the market will pay is fine, but that is a truely bull***tstatement.
If it is fine to charge market prices then why is it bull***t for someone to say that is what they are doing??
"So to keep up with demand AS's have to raise prices to reduce demand to a level that is sane."
Written like a true crafter trying torationalize maximizing prices. Charging prices that the market will pay is fine, but that is a truely bull***tstatement.
Raising prices has NOTHING to do with controlling demand. Why would someone want to deliberately want to reduce demand for their products or services? It's about generating as much profit as people are willing to pay. I understand market economics very well.
My comment was about the pseudo-altruistic rationalizations people make about the prices they charge. Why not just be honest about it.
Epsilon125 wrote:
Raising prices has NOTHING to do with controlling demand. Why would someone want to deliberately want to reduce demand for their products or services? It's about generating as much profit as people are willing to pay. I understand market economics very well.
My comment was about the pseudo-altruistic rationalizations people make about the prices they charge. Why not just be honest about it.
Epsilon125 wrote:
Raising prices has NOTHING to do with controlling demand. Why would someone want to deliberately want to reduce demand for their products or services? It's about generating as much profit as people are willing to pay. I understand market economics very well.
My comment was about the pseudo-altruistic rationalizations people make about the prices they charge. Why not just be honest about it.
There is less demand for something at a higher price than at a lower price. If movie tickets were $1 there would be a lot more demand for them than if they were $1000. Raising price will change demand.
I would want to slow demand from keeping things from selling too fast and to keep people from buying just to resell for a profit.
If I were to put some heavy harvesters on my vendor for 10k then they'd fly off in a day. Its quite likely that someone would buy them to resell. If all my heavies were priced that way it would empty out my vendor. Then I'd have an empty vendor. My vendor would be empty until I could get another batch of heavies made.
I don't want an empty vendor. Nor do my customers.
I don't really want to facilitate a reseller making a profit off my goods. If I wanted to wholesale then I'd find a merchant to sell to in the first place.
This does not necessarily mean that you are maximizing profits. I could raise my prices just enough to keep them from being attactive for resale or flying off the vendor yet not jump up to the highest possible price.
Pawlin made the additional point toP_Day's otherwise excellent post I was going to make. It's all very well saying 'sell them at a lower price' but you wouldn't be able to buy them at the lower price.
The first person at the vendor after re-stocking would buy them all, and then sell them on for a higher price. Who gains out of that? Not the crafter, not the end user, only the middle man who, more than likely, has no crafting or Merchant skills at all.
Message Edited by Muzz on 06-11-2005 11:25 PM
Every now and then, an "inflation" post pops up. Usually, its in response to someone wanting a certain item, but not being able to get it and so they rant against the "rich" because they don't seem to want to do the same amount of "work" in order to get what they want.
Credits are reward. They are one of the "point" systems that tell us how we are doing. If you don't have the "points" you are doing something wrong.
Credits are easy to come by. At the base level, you run missions for credits. As you advance, you sell or auction items or sell resources or crafted goods. If you can't get credits in this game, you have a problem.
Inflation doesn't exist here. There are no outside socio-political or economic factors that cause prices to fluctuate. We have no NYSE, no OPEC, no Greenspan, no Middle East conflict......the only things that raise or lower prices in this game are percieved worth, and supply/demand.
Prices from crafter A don't go up because combatant B made 20 million today running missions. Prices from crafter A will go up because they are using the last of a high-quality resource, or because they were able to make 30 capped weapons or other incidents that cause a rarity in supply. Same goes for looted items. +5 health enhancers for armorsmiths are a dime a dozen, but a stack of 11 +25's are going to go for quite a bit.
What the original poster seems to believe, however, is that the amount of money in circulation has anything to do with the prices people buy and sell for. It really only affects auction prices. I as a crafter have certain expenses which dictate the "cost to produce" of any given item. Included in this is the "pain in the (backside)" factor, i.e. how many hoops do I have to go through to do this and how much time does it take. Then, I add in my profit margin and rarity factor.
As a "looter" I go about things a bit differently. If I have something of rarity (high bonus attachements/enhancers) I can auction it or just set a price on my vendor based on how much its been sold for before.
Its the ultra-rare that have people screaming though....we've all seen the 70 million credit bids on completed Jetpacks. BARC speeders are another, but only because each account only gets 1, and so people who sell their one BARC are gonna want something for it, since they will have to buy another and their will be a limited supply of them based soley on the number of SWG: TTE sold.
We have enough sinks, their is no inflation, if you are poor you are losing the game.
/applaud Greyseven
The OP is just another in a long line of players who want the game DESIGNED to revolve around them.
captenjonny wrote:
/applaud Greyseven
The OP is just another in a long line of players who want the game DESIGNED to revolve around them.
ahhh the old Inflation post...oh my. seems to pop up every couple months, no?
There is less demand for something at a higher price than at a lower price. If movie tickets were $1 there would be a lot more demand for them than if they were $1000. Raising price will change demand.
That is true, but the price for movie tickets isn't raised to keep people OUT of theaters. It's raised just high enough so that people will still pay while grumbling about it the whole time. That is maximizing profits.
If I were to put some heavy harvesters on my vendor for 10k then they'd fly off in a day. Its quite likely that someone would buy them to resell. If all my heavies were priced that way it would empty out my vendor. Then I'd have an empty vendor. My vendor would be empty until I could get another batch of heavies made.
Again, I never advocated lowering prices below the edge of what customers are willing to pay.
I don't want an empty vendor. Nor do my customers.
This reason and the post about the "scare factor" of empty vendors I can actually understand (if they are empty too often), but I still find it hard to believe that you would chase off customers to another vendor. Unless, perhaps, you are practicing price collusion, which is another max profit strategy in itself.
I could raise my prices just enough to keep them from being attactive for resale or flying off the vendor yet not jump up to the highest possible price.
That is the essence of a max profit strategy. Raising prices to the edge of what people will pay. Demand will then fall off by itself.
How would these suggestions in any way be of any good for newcomers to the game?
Only rich people would afford to have houses and ships which is not good to segment players
in what can be similar to rich and poor people in America. No fun in that for anyone.