Business And Economy Archive
Thread: An idea to bring infaltion back under control.
PersianLegionary654 wrote:
KammaRocca wrote:
What are these people spending all their money on if not weapons and armor?
Food, furniture, vehicles, pets, clothes, resources, buildings, etc.
Crafted, crafted, might not be crafted but only restored through a crafted item, crafted, crafted, etc.
And if you use an ADK, you still have to buy weapons and armor (and you'll be able to spend more on armor if you don't have to replace your weapons as often and vice versa--the important thing is that ADK's aren't draining any one crafting profession--if they ever fix clothing decay, you'll get a lot more ADK's used on clothing too.)
Umm, no, ADk's are not a help to the crafter economy. You see, when you use an ADK, you destroy that bit of demand for that item for the rest of the game. That ADK's items is there for the rest of the game. The idea that since they don't need to buy more wepaons that suddenly they'll be buying extra sets of armor is ludicrous. That person will buy the armor he needs, and never buy his weapon again.
You are enaging in the "Broken Window" fallacy. The broken window fallacy is thus.
A boy breaks a window. The town people are about the punish him when one says "but he helped the economy! The window fixer will have to be paid to fix the window, then he can afford a new table. the carpenter will then be able to afford a new suit. The tailor will then..." etc.
The problem is it doesn't work. At the best, you're creating a short term increase in sales while destroying the long-term demand for another item.
Also, it's not "as often". It's never. That weapon or armor piece will be there forever. Never again will he need to buy it. Since having an ADK'd wepaon does not increase armor decay rates or Vice-Versa, it's disinegnious to say that it will "increase sales". No, it won't. It will give the combatant more money, while in the end shafting the crafters.
You're using the broken window fallacy if I am. "The weapon decayed. Theweaponsmith will have tobe paid tomake a new weapon thenhe can afford . . ."It will give the crafters more money while in the end shafting combatants.
Here's something to consider. I'd personally never buy a 15 million credit rifleif it decayed as fast as my last one did--I'd never even come close to being able to break even on it doing that. I wouldn't be willing to spend more than 100k or so if it decayed that fast. Put an ADK on it and suddenly the 15 million credit rifle makes sense. If I went with the 100k rifle and replaced it every time it became worthless, it would take over two years to spend the same amount if I had to replace it once a week.
If someone sells an ADK, there's a very good chance that they're using that money to buy better armor and weapons.
And that ADK will prevent someone else from needing to buy more armor and weapons, only this isn't a one shot deal with one sale like your ADK "profit" is, the ADK destroys a long history of sales over the course of the game, more than any "increased" sales elsewhere.
See above.
It works both ways. Sure there won't be any need for a player to keep buying 1.2 million credit rifles, but the guy who sold his ADK just might use the money to buy a 15 million credit rifle and a 5 million credit suit of armor.
Speculation and irrelevant. That money didn't appear from nowhereall in-game money comes from nowhere, it came from someone else who was just as likely as the guy who sold the ADK to buy more weapons and armor. The demand for the ADk'd item is permenantly lowered, and will continue to get lower as people continue to cancel their subscriptions and these ADK'd weapons continue to circulate, increasing the ratio of ADK'd items to players.
See above again.
BARC's might be a quick source of income for some--the only way I'd ever sell mine is if I could somehow get a jetpack out of it personally--but they also give new players purchasing power.
Why do new players need purchasing power? Isn't the point of the game to begin low, and work your way up? You do realize you are essentially handing them free money, destroying any point in actually working missions, or contributing in anyway to the economy? And on top of that, you're shafting the lower end crafters who make CDEF's and other lower-end weapons and armor?
Like I've said before, it really doesn't matter that they're not contributing because honestly if all you're doing is shooting bols and dewbacks, you're contributing just as much as a guy who hasn't ground out a skill.
With higher combat skills i can hunt Krayts, and get schematics, hides etc needed by crafters. A newbie who pays SOE to give him free in-game credits has done nothing. It's the same as buying credits, only officially sanctioned by SOE.
They're probably also going to spend the money they get for their BARC on weapons (because a CDEF can only get you so far) and armor.
A newbie does not need 3 million credits to spend on his first set of armor and weapons. One would think you'd be opposed to basically handing everyone who begins the game 3 million credits, but perhaps not.
OK, so if he doesn't need three million then he probably won't be spending three million right off the bat either. And we have ourselves a credit sink.
Beggining players start with an exorbitant 70K credits and a plethora of all noob weapons and equipment. The demand for these low-end items has now collapsed thanks to the fact they are iven out in massive amounts for free by the game, rather than sold by crafters. Look on the bazaar and you'll see what i mean.
Thanks to the massive amount of credits new players have, there is no mission grind for them, nor is there any real
Any real what? I am reading this you know.
So if the problem isn't inflation, why do we need increased credit sinks?
Becuase while inflation is not a major problem now, it has the potential to be so. With the increased activity of credit pharmers and the group mission payout increased by a vast amount (a 10K mission pays to 1 man, 10K, to 8 men, a total of 80K) means that it could potentially be a problem.
There's absolutely no need to increase credit sinks unless and until there is actually significant inflation when it comes to day-to-day goods.
For a Star Wars-esque feel, I liked battle fatigue just because it was the only reason to go into a cantina, but 99.99% (exaggerated for dramatic effect I'm sure) of all entertainers were AFK anyway and at any given time there were either way too many of them or none at all.
And that justifies making their profession irrelevant to the game? I see Combat players AFK'ing faction mobs at Mos Eisley, not only that, they're extremely common. Maybe we should make combatants unable to attack or loot anything. yeah, that's the solution!
You're the one who calls the buffs insignificant and their profession irrelevant, not me. The 10% faction and XP bonus adds up in a hurry. I still like the idea of battle fatigue, though.
If the problem is that people aren't buying from the crafters, how would credit sinks being increased by a large factor help?
Question still stands.
I think we're getting away from the main idea. Part of that reason I believe is because (as another thread pointed out) there is a lack of understanding on what inflation really is.
I'll use a real world example. Gasoline...prices in the US are up 200% from what they were a year ago and 300% what they were 5 years ago. That does not mean that inflation is up 200% but the demand for one product has changed. Translate to SWG. An ADK when they first came out went for 10 million, then dropped to 8 million, now they're up to 20 million. That has nothing to do with inflation in SWG. That means the market for one item has changed.
Weapons are the same price, the armor market is still changing but is similar based on the inputs required now, swoops are the same price, houses are the same price. High end loot is always going to be changing in price because the most important factor is timing.
If you are the only seller with multiple buyers for your auction, the price will climb because there are no other available vendors and an undetermined amount of time before a similar item is available for sale. If you are the only buyer with multiple sellers, then you can price shop until you find the price you want. Buyers are at your mercy as their choice is to accept what you're offering or hope to find another seller.
This applies to crystals, pearls,and N/S arm bands too. What makes a crystal worth so much more than it did 6 months ago. The drop rate has not been adjusted with the CU making the item even more limited than it was and more people are walking around with glowsticks. So we have a situation with more buyers coming into the market place when the supply is down. Adjust the drop rate and crystals return to a more normal price. Function of supply and demand, I don't see any inflation here.
Kippers wrote:I'll have to agree with Mandinga on this. The cause of inflation in the game is not so much what loot can be traded, but the credits influx. The game has reached a state in which we earn more credits from missions than what we have in NPC expenses (by this i refer to expenses that are not paid to other players). This results in an increasing amount of credits in the game and can thus give cause for extremely high prices on some of the rare loot in player to player trade.
Things that help counter inflation are elements such as previously mentioned vehicle repair, ship repair and shuttle expenses. But the problem with increasing these credit sinks is that only older and more established players will be able to afford it. A suggestion I could make would be a more drastic price increase when training high level skills or to completely (or partially) remove the ability for players to teach each other skills. This should have a strong and healthy effect on the economy.
All in all I find that we should soon have a revaluation of our credits. If everyone should lose 50% of their credits in the next publish we should see prices drop dramatically
Say what? Uh no, if everyone were to lose half their credits in an upcoming publish, people would go out and buy up everything prior to that publish, causing prices to rise. And those prices would stay up as people attempted to recoup what was taken assuming they didn't quit the game because of such a crazy publish.
Why on earth do you think that reducing the money supply would cause prices to drop? Seriously, if you have $10 million dollars irl and you were told you'd lose $5 million of at the end of the year, what do you think you'd do? You'd seriously sit on the money till that happened? No, you'd buy up stocks, luxury items, and property so that you wouldn't lose as much money when it came to the end of the year.
There is really only one thing that would cause prices to drop across the board and that's increased and continuing supply. If an item is more available and if people know it will continue to be just as available if not more, then the price should drop. Price fixing would sorta lower prices, except that inevitably people would make up for the credit difference either with barters or reimbursement payments.
The removal of the ability to train other players would have a negible effect on the economy. The interdependency we used to have with skill training was removed when they got rid of the training points we used to need for mastering professions.
I'm curious to why you think the balance between credits earned and credits departing the game is so lopsided? What evidence do you have of this?
Message Edited by bluejanus on 10-15-2005 06:09 AM
Giant2005 wrote:
KammaRocca wrote:
Giant2005 wrote:
Message Edited by KammaRocca on 10-13-200506:28 AM
You have made many good points right there, but you are missing the impact of demand. Inflation is high, and prices on smaller items may not be rising as nobody demands them, and that is why items such as ADKs which agreed are premium items are in fact, more of an appropriate indication of the inflation levels. As they and other premium items are primarily what is in demand so they are what is going to bear the price rises caused by the overly inflated economy.
First off, high demand for premium rare prices leading to higher prices for those items is a perfect indicator of a properly functioning economy
Increase demand over supply, prices increase.
Increase supply over demand, prices drop.
Small generic planet houses are in high demand. They are usefull as safe houses for jedi, and the ever increasing jedi population makes for a much higher demand for them. Shoot, I started selling houses before the jedi explosion, so I've seen the demand for them skyrocket. But because a low level archy can make then, the high demand results in more of them for sale, either existing archys making more, or people needing money taking up archy to build them. There is a glut of small houses on the market, so the cost hold the same.
Alderaan flora as decorations have been in some demand ever since I started stocking them. Small demand, but when I started I had the *only* ads for them in the trade forums and action. I sold them for 200k, and undercut the average (rare) trade auction by quite a bit. Currently, the demand seems about the same, but there's several people selling large numbers of the plants. They noticed that they were a good money maker, so jumped into the market. Bazaar search shows the average price to be 100k, and falling. Supply exceeds demand, prices drop.
After the CU, city halls were suddenly in demand. Personally, I went from selling 1-2 a month to 2-3 a week. I ignored my other lines, made more halls, and jacked up prices. Vendor serch showed me other archys doing similar.
ADKs arrive in game at a trickle. They're handy, people want a bunch of them, demand outstrips supply, and the costs go up.
I'm sure somebody who has study economics can offer a proof, but very simply:
Cost * (supply / demand) is a constant. (perfect world, all other variable constant, blah blah)
Increase demand, cost and or supply needs to go up. Houses saw an increase in supply that balance it out; Halls had in increase in both; ADKs can be made, so the only area that can equalize the area is cost.
Sure, artificial constraints could be imposed. Non tradable (but... why? if you can't buy it, no one else can?) Cap the cost? (they still would be sold, more people would be able to buy - until the the last people selling imposed barter requirements).
Greed's not entirely bad. I wanted money, I changed from a double combat grind to a split, and now I offer good that, to drum up business, are often below planetary average (with a few good deals and a few high priced rare items). My desire for money brings you what you want. (well, replace 'you' with 'members of the general populace who seem hapy to give me their credits').
Powerups are in demand. Food is in demand. Same with booz and drugs. Stims are in demand. Looted mid-level weapons are in demand (I sell a few dirt cheap. They may have 1/2 the firepower of a crafted one, but some people can't afford a few grand, so they buy my cheapo looties. Though I sometimes wonder if that's fair to grinding weaponsmiths...). Prices on those common in demand smaller items remain the same. When costs on a large number of common items is stable, inflation doesn't seem to be happening. Rare premium items do not count toward inflation calculations.
It happens because the net amount of money being thrown (via purchases and trades) around gets bigger and bigger.
Money creation (via missions) is far out pacing the money drain (via maintenance & fees).
This leads to the higher pricing on stuff.
So basically the main objective to get the "inflation" under control is to have the money being thrown around stay the same size. The only long term effective solution to that is to equalize the drain with the creation.
Reducing mission payouts or increasing maintenance or fees might be the only viable long term solutions.
Revaluing currency is only a temporary fix as you'll end up doing it again once the net amount of money gets big again.
Slysix wrote:
I think you guys are missing the point why things get expensive.
It happens because the net amount of money being thrown (via purchases and trades) around gets bigger and bigger.
Money creation (via missions) is far out pacing the money drain (via maintenance & fees).
This leads to the higher pricing on stuff.
So basically the main objective to get the "inflation" under control is to have the money being thrown around stay the same size. The only long term effective solution to that is to equalize the drain with the creation.
Reducing mission payouts or increasing maintenance or fees might be the only viable long term solutions.
Revaluing currency is only a temporary fix as you'll end up doing it again once the net amount of money gets big again.
NefariousCabal wrote:
Brovo! Brovo! My Friend!!!
I have been thinking this and latelly i have been saying this same exact thing.
People are getting money and throwing it around like it is nothing. Camping and selling.
I have 6 mil credits built up yes I too have sold AA and CA's but now that is all you see on the fourms.
But now that 6 mil doesnt seem like alot, like i just got an semi urber rifel and the cost of ADK is like 16-20mil but like three months ago they were going for 10-15 mil. there are so many points of veiws i have on this subject but. . . .
Now Vet Rewards I see yes on some of them but like rugs and holos should be tradeable.
Thanks for me not feeling like im the only one out there who thinks this way.
I see that you registered on the forums in September 2004, which means you've been playing for a year. So why do you need to pay 20 mil for an ADK when you should already have one for free? In fact, everyone who plays long enough will get an ADK for free.
It is easy to get money in this game, but prices for ultra-rare items, such as ADK's, are driven by supply and demand, not by inflation. If it were real inflation, then prices would be rising for everything, not just rare items.
A lot of people seem to think that by "reducing inflation", or reducing the number of credits in the game, they'll suddenly be able to afford all the great loot that is currently priced out of their reach. But they fail to realize that draining the economy of credits, and reducing the inflow of credits, will affect them too. So relatively speaking, they'll still be in the same spot as before; even though the loot might have lower prices, their bank accounts and earning potential will also be lower.
Slim Vargo, Corbantis
Slysix wrote:
I think you guys are missing the point why things get expensive....
Housing costs have remaind stable or dropped.... Food has remained the same.... The average weapon's cost has remained the same..... Certain loot items have gone *down* in price...
If a progressive galactic tax where to be implimented, with me paying 20% vs your 10%; if house maintenance were to triple (which is also a progressive drain, in case you haven't noticed; large houses which require a richer player to buy in the first place cost much more to maintain), I'd *still* be able to outbuy much of the player base, I'd still be rich, and rare things would still be expensive as hell, simply because I (and other rich players) know how to play the money game.
Slysix wrote:
For those of you guys who believe that there is no inflation the the prices of items are "stable".
Why would they increase bazaar sales price limit from 6K to 20K at the same time they instituded vendor search? Since vendor search by passes the price limit the only logical conclusion to bazaar sales price limit increase is well...inflation.
KammaRocca wrote:
Slysix wrote:
I think you guys are missing the point why things get expensive.
It happens because the net amount of money being thrown (via purchases and trades) around gets bigger and bigger.
Money creation (via missions) is far out pacing the money drain (via maintenance & fees).
This leads to the higher pricing on stuff.
So basically the main objective to get the "inflation" under control is to have the money being thrown around stay the same size. The only long term effective solution to that is to equalize the drain with the creation.
Reducing mission payouts or increasing maintenance or fees might be the only viable long term solutions.
Revaluing currency is only a temporary fix as you'll end up doing it again once the net amount of money gets big again.
I think you're missing the point of why things become expensive. It's supply and demand and only supply and demand. If the devs decided what is widely and mistakenly perceived to be inflation needed to be fixed,lowering mission values and increasing sinks would only deflate the value of the credit. There would still be exactly the same supply as before and as such there would still be only X number of people able to pay for certain items. The only difference would be a lower price, but that doesn't matter because relatively speaking the items would be out of reach for a certain percentage of players.
Ok here's one that'll throw you for a loop.
Think of credits as a commodity. Just like any other item that's tradable in the game.
Now imagine that you have an ever increasing supply of a commodity. Your telling me that demand of this commodity will not change? No the value of that commodity will drop due to the "oversaturation" of the market with said commodity.
So like you say supply and demand. There is to much of the stuff the price/value of the commodity will drop. Just like the price/value of the credit have dropped.
Why would they increase bazaar sales price limit from 6K to 20K at the same time they instituded vendor search? Since vendor search by passes the price limit the only logical conclusion to bazaar sales price limit increase is well...inflation.
