[dahalb]

I wanted to lay down some ideas for the economy of Jumpgate Evolution before its beta starts but in order to do that i would first describe what i believe are the axioms behind economics from the divergent play-styles.

PvP:
From a PvP perspective, what is the motivator? It is axiomatic that the PvP crowd are driven by there competitive nature. That is to say, that they are not driven by monetery rewards per se. The reason behind most PvP is either RP or, to use the vernacular, a "****-fight". It is driven not the accumulation of wealth but the perception of being "the best". I do not find fault in that and am not disparaging of the competitive streak which lies in all of us in any way.

Econ-workers:
From an econ-workers perspective, the motivator is wealth accumulation. That seems to me, to be the driving force behind most of the actions undertaken by econ's. There are some, i grant you, that are motivated by the desire to fulfill the needs of the community but if there were no wealth in it, very few would continue this career choice.

That said...I have my first disclaimer...

My idea(s) for the Jumpgate Evolution economy stem from the work i did with another game development team that sadly folded long before beta was ever realised. It also stems from my time as an Econ worker in Jumpgate Classic over many many months. So there is, i think understandably, some personal affection and pride in the ideas i will now put forth. I also hold the belief that while "farming" as it was and is known is not wrong, but was overtly wealth creating in its mechanics. In other words, i am not against farming as an economic tool, but am against the amount of wealth it could and did create.



Now. I would like to discuss markets. My idea is to have a 3 fold market system. That is, a system whereby there are three tiers of markets for each type of commodity or item. A producing market, a transition or holding market, and a consuming market. In simple terms a producer, middle-man, and consumer. Each would have a varying price for purchasing and selling individual commodities defined by a set of rules.

Market Rules:
Each market would have a fluctuating price dependant on 7 things; Global stock holdings, Local stock holdings, its ease of production, its "need", its cost, the associated taxes and charges and a pofit margin.

1. Each commodity or equipment item should have a "minimum global stock holding". This ensures that once that number is breached, the price for that item will increase above and beyond that would be regarded as "normal".

2. Each item should have a minimum "local stock holding". This effects the price locally within a band that would be considered "normal".

3. Ease of production should be included as a variable in all commodity pricing. This ensures that those items that are either hard to mine, in low concentration or require many componants are given a higher "variable value" which would increase base pricing.

4. Need should also be included as a variable in base pricing. Where an item is not required by the majority of production or consumption, the "variable value" should be low which in turn, would effect base pricing.

5. Cost should be literally translated into all up-stream commodities and equipment. Cost comprises only the base cost of any componants and/or the raw ore that goes into each item.

6. Associated taxes and charges should be calculated in the price of a commodity. These charges would be for things like, storage and transportation and the factional taxes that are imposed on each sale and purchase.

7. Profit. A percentage "on top" of all costs should be included. The corporations should actually be making money as they are not charities.

Producing markets:
Producing markets or stations are those that make or collect items. In terms of raw ores, those stations would be those where an "abundance" of that ore is found close by. These stations would pay the lowest price (in a range) for these items. The price at these stations would range somewhere between cost plus and cost plus profit. That is to say, if a miner mines iron, they are paid X, the cost of storage is Y and taxes are Z then the minimal price would be X+Y+Z. The upper range would include a profit margin of up to 10% (T) dependant on "the rules". So C=X+Y+Z+T where T is variable.

Transition Markets:
Holding markets or stations are those that neither produce nor consume the item. For these stations the price variants would be between the middle producing market price and the middle consuming market price. I.E if the producing market selling price is (X) and the consuming market buying price is (Z), then the transition market price (Y), would be somewhere in the vicinity of Y=(Z-X)/2+X+T.

Consuming Markets:
Consuming markets or station are those that require the item for manufactoring or sustainence. These stations would have the highest price range which would include all componants of cost, averaged across the entire economy. For example, if the producing station prices are X,Y & Z and the cost of storage ( a constant in this scenario) across all markets/stations is A, then the minimum price at a consuming station would be the mean of (X+Y+Z)+V (Variable based on rules). Its sale price would also add A+T+P (where P = a small profit).

To give a wholistic view I offer this scenario:

The life of 100 units of silicon. (Disclaimer: These names and actions were taken randomly and in no way reflect on actual people, events or facts in any way.)
SlimPickns is a miner who loves to mine silicon. He is a Quant whos primary base is Quantar Core. Quantar core is a production centre for silicon. SlimPickns mines 100 units of silicon. Quantar Core buys this silicon for 100,000 credits. The silicon takes up 1 storage space per unit and costs the station 10 credits per unit to store (1,000 credits). The quantar goverment has a GST of 5% on all items sold so Quantar Core adds an additional 5,050 credits to its base sale price making the minimum sale price 1,060.5 (1061 if rounded up) credits per unit. Current interglactic holdings are low and therefore they can charge a premium of 5%(5302.5 per 100). Their individual stock is also low and so they add a further premium to the purchase price of 2%(2121 per 100).

InterOrka is an econ worker and wants to purchase the silicon to make electronics. Quantar core is his favoured market and so he purchases the 100 units available there for 113,474 credits. He sells this shipment to a holding station enroute to the most silicon hungry station in space for 120,000 giving him a profit of 6526 credits. The holding station add its storage charges of 10 credits per unit and the applicable taxes of its faction(1.5%) and arrives at a price of 122,815 credits. Global stocks are low and so it also adds a premium of 5% (6140.75 per 100) to its sale price. Its local stocks are abundant however and it wishes to remove some stock and so it deducts 2% (4912.6) from its price in order to "move" the stock on hand. Therefore its final sale price would be 124,314 credits (per 100).

dahalb, who is also an econ worker, needs silicon for Solrain Core but does not have the time to travel all the way to Quantar Core to get it, so he goes to Klatsches Hold instead where he knows there is an abundance. He buys 100 units @ 124, 314 credits and transports it to Solrain Core. SC has no stock and is a consuming station so SC pays 150,000 credits per 100 units giving him a profit of 25,686 credits. SC adds its 10 credit per unit storage cost, plus the solrain sales tax of 8%(12080), plus the galactic shortage tarrif of 5%(7550) as well as the profit margin of 5% (8854)and ends up with a sale price of 179484 credits per 100 units.

So to recap,
SlimPickns the miner makes 100,000 credits,
InterOrka the econer makes 6526 credit (because he is time poor or lazy)
dahalb the econer makes 25,686 credits (because he is astute or lucky)
A contientious econer or PvPer in need of cash who has more time available could make 32,212 credits each run.

It is important to note that this system/scenario does not consider mission payouts specifically but that these payouts could be rolled up into the profit margin percentage added to the sale price. Farming is still possible under this system/scenario but under limited conditions and has a minimal profit associated.


Finally my last disclaimer. I was slightly drunk when compiling this but wanted to get it out before i forgot it all so if i have been unclear or incorrect in any of my assertions please feel free to correct me or add to the idea.

I would greatly appreciate your constructive feedback

[Karash]

Why dont we make equipment and ship manufacturing by players the focal point of the economy? Then traders could actually move equipment based on risk and reward to non producing stations and sectors depending on what that area needs.

I dont like NPCs producing all the stuff for us...carebear wars ftw.

[Injustice]

I get the feeling that a majority of the time spent in beta testing is going to flesh out which economic system will work the best, and I'm hoping the dev team is planning to allow some initial flexibility in the economy that'll allow us to tear apart each system and figure out which works best.

[Chicod]

dahalb,
First off... if you wrote this while drunk, then keep on drinking. We need more, thought-out ideas like this.

I've used your formulas to flesh out more extreme examples of your scenario. I've come to a similar conclusion in that as long as your global and local modifiers aren't that extreme (5% and 2% are not bad... 5% tax isn't bad either), then this system could create jobs and opportunities for many people... short distance haulers, longer distance haulers, as well as the opportunistic hauler.

The best part is that in order to farm to the extent that we used to with Matter Converters, you would literally have to control not just 1 station, but the entire economy's volume of that commodity. And even then you would only get the local % + global % tack-on.

The only part that I am not seeing is that in the game, players wouldn't be buying commodities in 100 lots. Instead, they might buy and move 30. I would have to assume that the price being advertised for purchase by the station, would be based on that station, and not by the cost of the lots as it's been moved from location to location.

[Wild_Bill]

Makes a lot more sense than what we've got now or ever have had IMO. Let folks make a profit at every step of the process. As to what Karash said, I agree also. If I mine it, refine it, produce it and then haul it, I ought to make a a decent profit at each step. There should be risky places that are willing to pay more for what they get and other places that barely make a profit hauling to them. None of this nonsense of losing credits in station stocking!

[dahalb]

Originally Posted by Karash

traders could actually move equipment based on risk and reward to non producing stations and sectors depending on what that area needs.

While my ideas dont delve into the "risk" portion i do believe that the rewards for non-producing and non-consuming stations are taken well care of.

Originally Posted by Karash

I dont like NPCs producing all the stuff for us...carebear wars ftw.

I don't think NPCs will be producing everything for us. The players will have a bigger impact on the economy. From what has been released thus far on the AI, i believe that the AI will fill only the desperate requirements of the economy where there are no human pilots fulfilling the need.

Originally Posted by Chicod

dahalb,
First off... if you wrote this while drunk, then keep on drinking. We need more, thought-out ideas like this.

Thanks

Originally Posted by Chicod

The only part that I am not seeing is that in the game, players wouldn't be buying commodities in 100 lots. Instead, they might buy and move 30.

I used lots of 100 for rounding purposes mainly and kept it going to show who makes what. The price would ultimately boil down to a per unit cost not a per 100 unit cost.

Originally Posted by Wild_Bill

If I mine it, refine it, produce it and then haul it, I ought to make a a decent profit at each step.

I didn't add refining costs into the mix and i apologise for the oversight. I started this work for another project that died last year. When i came across this i decided to put it up for consideration but it was unfinished. Refining costs should be included but would be pre-date the scenario i put forward as the "miner" mined silicon which under Jumpgate Classic is not likely unless they went pure hunting only. I will work on refining and add it

Originally Posted by Wild_Bill

There should be risky places that are willing to pay more for what they get and other places that barely make a profit hauling to them.

The stations/markets you talk about could fall into any of the 3 categories because i still ardently believe that unregulated sectors should make something or be a primary source for something unlike what exists in Jumpgate Classic.

Having said that, there still needs to be a balance. Straight market prices need to be flexible but not fluctuate too wildly. A pseudo-value-increase at a particular market/station could present a situation where even though the economy is screaming out for an item at a certain station, the price is too high to purchase it and represents too much of a loss for anyone but fat-factionailists with tugs full of credits to make those runs. And lets face it, it will take a while for them to appear

Originally Posted by Wild_Bill

None of this nonsense of losing credits in station stocking!

My idea was designed to avoid this but nothing is infallible and i think that there may be occasions where a zero profit would be taken by factionalists trying to accomplish something. On the whole though I think that everyone would be able to make at least a minimal profit on every run.

[Jonboy]

Basicly, this system appears to be "time invested = profit" with some fluctuations in price based on local and global stock. Individual pilots get better profit runs using an on-line tracker/calculator. Would you agree with this assessment?

Global and local variations are what caused matter farming, frequently involving a dozen or more people. I think Istvan removed much of the variation to prevent farming, and left in time=profit, but left in a very static (boring?) system. The problems that he left include a lack of flexibility (the need for magnesium one day can be different from the need another day), a lack of player interaction in price, mining being stuck as only good for those who enjoy mining, and sometimes all the base commods moved to the consumer stations (is that good?) so there's not a lot left to move.

Your system really isn't that different from what was in Jumpgate originally, with the exception of global stock making a difference. This has been suggested before, and Istvan did not implement it.

The trouble with most systems is that they take a large investment of time to work out 'need.' It would take a while to make a database of ratio of production of materials in mined ore, transport time (density and distance), and ratio in product. But even then, you can't really factor in demand. How many flashfires are actually going to be needed?

Your economy and the current economy are not really supply/demand driven.

Here's a link to the economy I suggested ( A market-driven economy ) It has its own problems, like the fact that the market doesn't absorb failed sales well, and there is no great need for unreg yet. However, the market determines value, so it can absorb changes in production without GM intervention, and need is purely player driven.

I'd like to see some sort meld of both perhaps. I certainly hope the Devs invest as much time in economy balancing as they do in ship balancing, as it has turned out to be a major play-feature of the game.

[dahalb]

Originally Posted by Jonboy

Basicly, this system appears to be "time invested = profit" with some fluctuations in price based on local and global stock. Individual pilots get better profit runs using an on-line tracker/calculator. Would you agree with this assessment?

Possibly, but not necessarily. There is a chance for a very large profit with little effort if conditions are ripe.

Originally Posted by Jonboy

Global and local variations are what caused matter farming, frequently involving a dozen or more people. ....Your system really isn't that different from what was in Jumpgate originally, with the exception of global stock making a difference. This has been suggested before, and Istvan did not implement it.

THe main difference is that the global stocks influence the maximum price, but consuming stations will always have a higher lowest price than the highest possible price at a producing station. "Farming" as it was is impossible. The difference is that farming would be possible in a limited fashion between transition markets and consuming markets because local variations may be enough to produce a profit "IF" there is a large moveable feast going on. The profits would be infinitesimal compared to the millions made each load in the early Jumpgate Classic economy.

Originally Posted by Jonboy

The trouble with most systems is that they take a large investment of time to work out 'need.' It would take a while to make a database of ratio of production of materials in mined ore, transport time (density and distance), and ratio in product.

You lost me here because this is exactly where the economy we were developing came into being...in a MySQL DB. We were going to know long before hand, what the most intrinsic ores were for production. The difference was, we couldn't be 100% sure of what equipment people would use until beta and even then, things can change. In terms of production ratio's and the rest we would know everything except travel times. That could never be 100% accurate so we weren't going to try at that early stage. Figuring out a consumption baseline would give us the details of what needed to be mined and in what quantities to support the players.

Originally Posted by Jonboy

But even then, you can't really factor in demand. How many flashfires are actually going to be needed?

This is the X factor. Demand is always going to fluctuate. It depends on things like, PvP/PvE activity, ship/equipment losses, damage (if that's instituted) etc. This is where beta would come into it. Testing even on a limited scale of say 500, would give you a taste of what might be in the pipeline. We had an alpha and two betas in mind so 'most' of this would have been worked out.

Originally Posted by Jonboy

Your economy and the current economy are not really supply/demand driven.

I see your point, but you cannot have a totally S&D economy because in a world such as Jumpgate, the "rich" will then corner markets and farming is what you get. My idea limits this with safeguards allowing supply and demand to find their equilibrium with a little help. No-one gets to "corner the market" but everyone has a chance to make a decent profit.

I enjoyed your ideas just didn't agree 100% with them. I don't necessarily agree that the auction house should form the "bedrock" of the galactic economy which i eluded to in my responses. The ideas i mentioned in your thread are more fully realised here.

I am working on an amendment to the idea currently which involves station limits for buying commodities and specifically ores of a certain type. It has more to do with the mining side of the economy and it still needs some work but i will add it as a "part-2" of this thread when its more complete. It also includes WB's refining.

Thanks for the feedback everyone I have been enjoying the debate.

[Jonboy]

Originally Posted by dahalb

There is a chance for a very large profit with little effort if conditions are ripe.

As long as you can manufacture ripe conditions, you will be able to farm, maybe not in the traditional manner, but people will figure it out.

Originally Posted by dahalb

The main difference is that the global stocks influence the maximum price, but consuming stations will always have a higher lowest price than the highest possible price at a producing station. "Farming" as it was is impossible. The difference is that farming would be possible in a limited fashion between transition markets and consuming markets because local variations may be enough to produce a profit "IF" there is a large moveable feast going on. The profits would be infinitesimal compared to the millions made each load in the early Jumpgate Classic economy.

Farming was usually between two consumer or two producer stations, to reduce distance. It appears you would be happy if farming was returned to the game, but made limited. Shrug. Why do you want farming back? What would be the benefit, or is it just necessary for the scheme you want?

Originally Posted by dahalb

In terms of production ratio's and the rest we would know everything except travel times. That could never be 100% accurate so we weren't going to try at that early stage.

Optimal travel times are easy to calculate. You have the mass of the item, and the average thrust of a tug. You plug those into the formula for speed, and the distance, and you have your travel time. You know start price at a producer, you know how long it takes to get to the destination - add desired profit per hour to the start price, and that's the sell price the Dev sets it at the consumer station.

Originally Posted by dahalb

Testing ... would give you a taste of what might be in the pipeline.

I agree.

Originally Posted by dahalb

You cannot have a totally S&D economy because in a world such as Jumpgate, the "rich" will then corner markets and farming is what you get.

You cannot exploit the market in the economy I set up, because the only purchaser is REAL people. You might be able to exploit the people. But you wouldn't be able to farm the server for money.

====================

I've responded FAR, FAR too much about farming in this post. In actuality, I'm not that concerned about it. It looks like you want it as a necessary evil for a more flexible ecomony than was in-place when I left... to make it more fun to find a best profit run. But your economy isn't really very adventurous.

I'm honestly more concerned with mining. In my economy, the market determines the value of mined ore. So if you find a bunch of particularly rare, but useful ore, you are not limited to selling it at the base price. Profit will motivate you to mine more.

Hauling would not be all time=profit tho, which would be more risky and difficult, as you'd have to work out what would actually sell well. It's dependent on having a population large enough to have a dependable need being present. I don't know if that is what people would want in a game. People seem happier with dragging the same **** back and forth.

I think that the economy has to be a game-economy, and more fun than a real economy. Yours would be more easy to make money in.

I'll say it again... I certainly hope the Devs invest as some good time in the economy.