The MMOG Economical Flaw

[Swede]

gold standard IS all out barter - money is just an easily portable replication or representation of gold, which would be to heavy to carry in RL.....

Having a fiat monetary system with no regulatory instance, no state bank and no control leads to alot of problems, as we have discussed.. and imo its way easier to configure a working gold standard system than try to convince alan greenspan to play a mmog....

[El Gallo]

Keeping the money supply stable should be of the utmost concern of the world builders and must remain so throughout the life of the project

This is a recipe for massive deflation.  These games have an ever-increasing supply of goods.  Keeping the money supply stable in this situation would ream all but the very earliest competitors (indeed, it would drive everyone away from using money as a trade medium in your game in the first place). 

[koboshi]

Keeping the money supply stable should be of the utmost concern of the world builders and must remain so throughout the life of the project

This is a recipe for massive deflation.  These games have an ever-increasing supply of goods.  Keeping the money supply stable in this situation would ream all but the very earliest competitors (indeed, it would drive everyone away from using money as a trade medium in your game in the first place). 

I said stable, not unchanging. Instabilities like inflation and deflation will, in the short run and over time, cause the populous to distrust the exchange medium.

[HaemishM]

And now you have a game.

Instrinsically obvious, but not easy to implement. That hoard would have to be awfully accessible to targetting, or the game locks up like (extremely) early UO. Once you've made it accessible, the player or guild in control needs to guard it, likely by catassing. If they succeed, the game locks up like ShadowBane.

Yes, once you start making resources finite and letting players control them, you better have a PVP game. At which point, congratulations, your game just became a niche product. Nothing wrong with that, but you'd better be ready for it.

Very few consumers like to be on the losing side... the life of a revolutionary striving to overthrow a great power works well in fiction, but Joe and Jane gamer in a similar situation tend to play serfs for a short while, and then leave. Zero Sum: The Rich Get Richer! is not a realistic MMORPG.

Playing a guerilla fighter in an MMOG sounds exciting, but it isn't really. The only way for a guerilla fighter to win in an MMOG is to drive the dictator/overlord from the game, thus depriving your game of a customer or group of customers (my guild quits!). Guerilla fighting in MMOG's attracts the griefers, who aren't really out to play the game so much as cause havoc to the established guilds/players. Sure, there are some who aren't out to be griefers, but the very lifestyle attracts the griefers, just like real life revolutions attract the power hungry sadists like Stalin. On the flip side, the larger the victory in an MMOG, the easier it is to hold on to your winnings. The winners get stronger, the losers get bored or become griefers and either is bad because it drives people from the game.

And yes, people like Haemish will either scream bloody murder when you fuck it up (and leave) or just leave the game quietly.

[Nebu]

Yes, once you start making resources finite and letting players control them, you better have a PVP game. At which point, congratulations, your game just became a niche product. Nothing wrong with that, but you'd better be ready for it.

Dead on here.  The other concern in creating an economy where resources are finite is one of alienating new players.  Someone that joins the game at some point when the economy has somewhat stabilized will be at the mercy of those that control scarce resources.  As Haemish points out the only way to circumvent this would be through a PvP mechanism, but the market shows that most people aren't interested in this given alternatives.  Me personally... I'd love it.

[Johny Cee]

Is anyone familiar with the the DAoC economy now?  I think it's instructive.

NPC goods are generally worthless and not purchased,  except for DF and aurulite gear.  This gear is sub-optimal,  and it's not too difficult to farm the seals/aurulite to purchase it.  This is in effect a subsidy to new players or players new to this server,  to get them started.  In the pvp/rvr atmosphere,  no established character would want sub-optimal gear.

NPCs also sell crafting supplies (metal, wood, whatnot).  Since this is the cheapest source of it,  and the price doesn't change,  it leads to a situation where your marginal costs do not rise as you craft more goods.  (Flattened supply curve).  The only limitation, then, is the cost of raising a crafter to appropriate level (fixed cost) and a function of the probability of crafting a selected quality of good. 

For 99% quality goods,  there is almost no profit.  For Masterpiece (100% quality) goods,  which are extremely hard/time consuming to make, there is some crafter markup, so some profit.  If prices go too high for MP items,  players have options:

1. Guild crafting mule
2. Go with the 99% substitute "inferior" good
3.  Wait for the market.  Generally,  crafters start producing more MP items as prices spike and they see profits to be reaped.

The market and prices for crafted goods is fairly stable,  and has been for some time.  Less some changes in markup on MP items for inflation.  99% quality goods are stuck at marginal cost,  and have been for years.

Most of the market is in scroll drops,  unactivated artifacts, and high-end drops from epic encounters.  For which definite prices have been set over time to keep pace with both the change in money supply (increased supply of gold with not many cash sinks) as well as changes in template building (i.e. player demand for "ideal" items in certain slots.)

To earn coin,  you go out and farm one of the new resources:  scrolls, epic/high-end drops, unactivated artifacts.  Sell for coin on your merchant so you can purchase the piece of the puzzle you need.

Generally, some good money can be made solo/casual in scroll farming.  Some blues/yellows (easily soloable) drop decent scrolls.

Guild groups or dedicated farmers can rake in cash farming hard to get scrolls,  or artifact encounters. 

With a good knowledge of demand,  you can make alot of coin playing the market (essentially arbitrage).  Cruise market explorers for in-demand items at sub-market prices, and resell.  I made most of my money doing this.

There is a fair amount of inflation, since gold is continually created in the economy and there are few gold sinks. The rate of inflation appears to be stable, though.  This means gold is still the medium by which all transactions take place,  unlike some games where currency almost completely lost value (AC was the preminent example, right?).

Since the prime method of acquiring gold is by scroll/arty/item farming,  the gold reaped keeps pace with the overall market as prices increase.

The supply of money,  as long the rate of inflation is not constantly increasing, is not a significant factor in this economy.

Just my late night meanderings, though.

[Pococurante]

There is no "gold standard" in MOGs.  This is a virtual game.  I can't melt down my gold piece.  MOG gold is no different than RL dollars - a fiction that simplifies the exchange of units of work into something portable.  If my game has hit the point that inflation is unacceptable, the problem is NOT the economic model but making sure whatever I allow added to the world carries a strong incentive to be removed from the world.  In UO's case they did something very fun to rectify a past flawed design goal - Clean Up Britannia was fun for the players and did its job.

Why the hell are we trying to wring the fun out of a game by aping financial controls from the real world?  Exactly why would I as a developer spend the thousands of dev hours (ahem, hundreds of thousands of RL dollars) to come up with a barter system that in the end acts just like a gold piece, a silver piece, and a copper piece.  The last thing I'd do as an investor is put my money into an entertainment product full of nothing but coercive "game mechanics" because I'm too unimaginative to put in fun goldsinks or I'm too limp-wristed to standby the requirement "adventurers" find a repair scroll.  After all, this is a Massive game - they don't want to interact with crafters they should be playing an FPS.

There is an exception - targeting a "true" virtual world to education markets.  But I don't hear that as the backdrop.

why?

Sorry Swede first time I've been back to this thread.  "Why" code in barter or why do I see them as two separate issues?