Is the economy still ruined?

[Masuri]

For me Im saying the gold value itself isnt broken because prices adjust.

This is simply not accurate in a game economy. Only player-to-player prices (variable costs) will adjust. Games like UO have fixed prices (housing, insurance, and the faucet itself) that will NOT change no matter how much or how little money is in the economy. This is why inflation breaks game economies. Fixed costs (usually goldsinks) are trivialized by inflation at the same time newcomers to the sandbox are marginalized by it.

It should be noted that games like UO which are heavily item based and (therefore) suffer from enormous power creep, are much more affected by inflation, than games which are not. I would be happy to discuss some other game economies for reference if anyone's curious about how UO fits in.

Just in real life, the biggest victim of inflation are the poor. There are good reasons why inflation is heavily frowned upon . . . it is a very well-known fact that inflation increases poverty and affects poor people more severely than the rich. This is true both in real life and Ultima Online. Your examples make little sense. Inflation hits the poor the hardest

Actually, Inflation doesnt hurt the poor. I hurts whoever doesnt have the initial gold influx.

In the interests of clarifying this particular game economy / real economy and inflation / hyperinflation debate:

In the real world, the poor are not the hardest-hit by inflation. The poor have no savings, so they have no money to lose value. The poor might be hurt by a "lag-time" in the short-run while wages catch up to meet to inflation, but in the long-run they will be no better or worse off than they were before. The people most hurt by inflation are the people with a lot of capital which now has less value, nd that money is unlikely to regain its original value in the long-run, or ever, because that would mean deflation, and people avoid deflation for reasons I'll explain in a sec. Granted, you could argue that the poor are affected by that, since if capital isn't being transformed into jobs, the poor have fewer job opportunities in total, but I don't think that's what you meant. Now, hyperinflation destroys economies so thoroughly that both the poor and the rich are crippled. But the real world has only had a handful of those in the last century, they're outliers really, and I'm very hesitant to apply that term to UO.

Here's what I would apply to UO: UO is like the real economy would be if wages NEVER caught up with inflation. Imagine if, in the real world, we were being paid 1950s wages, and being charged 2008 prices. That's UO, stuck in the past in terms of its gold faucets and sinks - faucets and sinks that are NOT features of a real economy*, and which do indeed make the difference in how inflation affects the system. In such a scenario, yes, inflation hurts the poor, the noobs - and I've already explained why ad nauseam.

As an aside: it's not entirely accurate that inflation is heavily frowned upon in the real world. Most real economies deliberately cause a small amount of inflation to encourage growth, investment, and to keep up with population. If they didn't, we'd end up with a system in which the people to money ratio decreases - that is, money would feel more valuable because there would be less of it per person. This causes deflation, as people hoard money with the belief that it will continue to become more valuable, and obviously this can be destructive to the growth of an economy.

*Simplifying in the interests of not tangenting further.

 

[RavenWinterHawk]

Hey Masuri,

I agree with you. I look at the economy as player to player. Why? Just as you said. The NPC costs dont reflect much. They are fixed. Yeah bottles and arrows and ores go up but thats only based on how much is bought. It has nothing to due with the economy. In fact I would argue the purchasing of items on NPC typically go to resale player to player. To me there is 1 economy, player to player. The rest of the stuff are items to be used by players in my idea of the economy.

Keeping house prices fixed... Helps new players. Adding land helps new players. Its available. I wonder what would happen if house placement costs went up. Ah well different story.

I have a narrow view of the economy. Player to player. Which inlcudes gold and trading. A new player can get items and trade for items. Gold isnt needed.

Without a gold sink, players have nothing to purchase and remove gold. You cant stop player to player items from going up. Sure you can release more items but thats a whole different story.

Whats your though or being POOR in UO?

 

[Masuri]

I think, Raven, that it's just not possible to separate the two, as you have done, and still be adequately addressing the health of the economy. Certainly, we can differentiate between them, isolate them to some degree: there's a low market (faucet/sink) and a high market (player-to-player) here. (There's also a faucet of items being spawned by the game - with next to no sink - and a faucet of items being created by players - with next to no sink for all but the obvious consumables like potions). But insofar as the low market directly affects the high market for newcomers to the sandbox, it's impossible to split that up and call the economy dandy. All the money in the economy - all the money being traded between players in the high market - came into the system from that low market, and is supposed to be (by original design) leaving the same way. It's not. It stays in the system and inflates the currency, which in turn breaks the low economy for the wealthy, and makes the high economy impossible to break into for the poor. Classic sandbox. It's game theory 101, and our devs continue to fail it. Hell, no MMO has pulled it off to date.

You're right in that keeping some of the sinks (such as housing) fixed, helps noobs. (I'm still talking about a game economy by the by, not the real world! ) But housing isn't one of those power creep variables I was talking about before - having a house doesn't affect the primary activity of the game, the way to get money out of the system rather than people, the only way for a noob to start: hunting. Sure, some people don't hunt. But the game is centered around it, acquiring better and better gear, hunting bigger and better monsters, to make more and more money through the faucet. Even if you never fight and only craft, you're selling stuff to fighters, you're part of the faucet/sink process. Over eleven years, the power creep coupled with currency inflation has raised the bar on gear insanely high, far too high for a brand-new player with no cheats or inside info to reach within any reasonable amount of time. Unlike your example of houses, which are bought from the game at a fixed cost, most of the consumables and gear new players will need to buy to compete, are made or sold by players at said highly inflated prices. This the the same 'barriers to entry' sandbox argument I was making before, and it is the reason the inflation matters.

Whats your though or being POOR in UO?

I don't feel poor in UO. I am sure that I am, given the prices floating around Luna, at auctions, and so on, but that's partly because I sold my ancient accounts many years ago and rerolled to LA when it opened, and partly because I only play for a month every few months to hold onto my house, waiting for UO to add new content aimed at soloers, mostly. I pretty much have the things that I need, and many things that I want, and certainly more than enough to play the game my way. I can recognize, though, that if I wanted to dominate in PvE or PvP, I would be completely screwed and be unable to compete without some external means of buying in.

Still, I'm a crafter and a shopper at heart, so the economy at all levels affects my enjoyment of the game. LA has a decimated population, so very few people are buying or selling anything. In frustration with this, I tried rerolling to Atlantic, half as an experiment. ATL is quite a bit more populated and the economy is more lively, but even rougher on the noob, because the currency is even more inflated there. Being a poor noob again was such an awful experience that I resolved to either scrap the whole idea, or shell out the money for transfers, because it would take me years of work to catch back up. UO causes noobs to bolt back to modern games like WoW, it's really that simple. There's actually another thread somewhere in the last week about things to do to improve the noobie experience, and fixing the economy is mentioned many, many times in that thread.

 

[RavenWinterHawk]

I think, Raven, that it's just not possible to separate the two, as you have done, and still be adequately addressing the health of the economy. Certainly, we can differentiate between them, isolate them to some degree: there's a low market (faucet/sink) and a high market (player-to-player) here. (There's also a faucet of items being spawned by the game - with next to no sink - and a faucet of items being created by players - with next to no sink for all but the obvious consumables like potions). But insofar as the low market directly affects the high market for newcomers to the sandbox, it's impossible to split that up and call the economy dandy. All the money in the economy - all the money being traded between players in the high market - came into the system from that low market, and is supposed to be (by original design) leaving the same way. It's not. It stays in the system and inflates the currency, which in turn breaks the low economy for the wealthy, and makes the high economy impossible to break into for the poor. Classic sandbox. It's game theory 101, and our devs continue to fail it. Hell, no MMO has pulled it off to date.

You're right in that keeping some of the sinks (such as housing) fixed, helps noobs. (I'm still talking about a game economy by the by, not the real world! ) But housing isn't one of those power creep variables I was talking about before - having a house doesn't affect the primary activity of the game, the way to get money out of the system rather than people, the only way for a noob to start: hunting. Sure, some people don't hunt. But the game is centered around it, acquiring better and better gear, hunting bigger and better monsters, to make more and more money through the faucet. Even if you never fight and only craft, you're selling stuff to fighters, you're part of the faucet/sink process. Over eleven years, the power creep coupled with currency inflation has raised the bar on gear insanely high, far too high for a brand-new player with no cheats or inside info to reach within any reasonable amount of time. Unlike your example of houses, which are bought from the game at a fixed cost, most of the consumables and gear new players will need to buy to compete, are made or sold by players at said highly inflated prices. This the the same 'barriers to entry' sandbox argument I was making before, and it is the reason the inflation matters.



I don't feel poor in UO. I am sure that I am, given the prices floating around Luna, at auctions, and so on, but that's partly because I sold my ancient accounts many years ago and rerolled to LA when it opened, and partly because I only play for a month every few months to hold onto my house, waiting for UO to add new content aimed at soloers, mostly. I pretty much have the things that I need, and many things that I want, and certainly more than enough to play the game my way. I can recognize, though, that if I wanted to dominate in PvE or PvP, I would be completely screwed and be unable to compete without some external means of buying in.

Still, I'm a crafter and a shopper at heart, so the economy at all levels affects my enjoyment of the game. LA has a decimated population, so very few people are buying or selling anything. In frustration with this, I tried rerolling to Atlantic, half as an experiment. ATL is quite a bit more populated and the economy is more lively, but even rougher on the noob, because the currency is even more inflated there. Being a poor noob again was such an awful experience that I resolved to either scrap the whole idea, or shell out the money for transfers, because it would take me years of work to catch back up. UO causes noobs to bolt back to modern games like WoW, it's really that simple. There's actually another thread somewhere in the last week about things to do to improve the noobie experience, and fixing the economy is mentioned many, many times in that thread.

Good points.
And an added one. Shard economies. I left origin and sonoma because they were to slow. Now I shrunk accounts and only hang at atlantic.

The activity is high and trading is active as is selling.

You have to set roots there.

Probably the schew in my view is I am on atlantic. Any one can make a million quickly there.

If you need help Id be glad to help you out there. I have nothing to spend my gold on. Seriously. Id be glad to spread the gold and help you out.

 

[Tomas_Bryce]

In the real world, the poor are not the hardest-hit by inflation. The poor have no savings, so they have no money to lose value. The poor might be hurt by a "lag-time" in the short-run while wages catch up to meet to inflation,

We are going way off-topic here but I have to disagree. Your definition of poor is not matching the reality of how the world bank defines poverty line. Inflation, especially hyper-inflation, hits the poorest people hardest because they cannot even afford food anymore. They hardly have consistent wages which can hope to "catch up" anytime fast. Also, there are steps that can be taken to profit from inflation. But the very rich are the ones who are better equipped with this. For example, in Ultima Online I can increase my wealth from millions to billions easily and inflation tends to improve my profit margins. However, I also usually have few billion gold invested in items at any given time as a hedge against gold inflation.

There is a very nice paper published recently by World bank that looks at the effect of inflation on the poor that you might want to look up.

Inflation in UO doesnt hurt the poor.
Poor is poorly defined in uo.

Define poor in UO and maybe you have a point.
But a player with little gold isnt a poor player.

You are correct to state that people in UO are generally not that poor. However, if it was possible to get statistics on the % of UO population that consistently has to buy gold for $ then I am quite certain that it is quite high nowadays. This is how I would define the overall poverty in Ultima Online - when people have to take the drastic measure of using outside currency to afford the things they want. It also reflects on the gross erosion of confidence in the in-game currency, i.e. gold.

On a side note, you keep saying that -anyone- can make money quickly. You provide examples based on your experience but you fail to understand that if everyone collected halloween items then they would not really sell for anything. Your examples depend on not only a person having the knowledge but also on majority of others not having that knowledge. They have the inherent quality of not being a universal solution. So yes anyone can indeed make money the way you give an example of but only as long as everyone is not doing the same thing.

 

[Harlequin]

Actually, it is a very well-known fact that inflation increases poverty and affects poor people more severely than the rich. This is true both in real life and Ultima Online. Your examples make little sense.

Inflation hits the poor the hardest

I don't think that any sound economic theory would adjudge the Sosarian economy as being healthy.

Sosaria is not in debt nor does it have a budget deficit

That said, since gold is created out of thin air, a crude analogy would be like having a country that keeps printing money when it runs out. Hyper-inflation is bound to happen, and eventually people loose confidence in that currency.

It's a simulated economy in a game, and although certain RL economics do not apply, it's still fascinating to watch and think about the RL parrallels.

We are going way off-topic here but I have to disagree. Your definition of poor is not matching the reality of how the world bank defines poverty line. Inflation, especially hyper-inflation, hits the poorest people hardest because they cannot even afford food anymore. They hardly have consistent wages which can hope to "catch up" anytime fast. Also, there are steps that can be taken to profit from inflation. But the very rich are the ones who are better equipped with this. For example, in Ultima Online I can increase my wealth from millions to billions easily and inflation tends to improve my profit margins. However, I also usually have few billion gold invested in items at any given time as a hedge against gold inflation.

Yes, making more money when you are already rich is alot easier. Similar in RL, the rich tends to get richer.

Investing gold in items (read: desirable but limited/hard to get stuff like server births/event items etc), even prime real estate is a good way to hedge. Though they carry their own risks, you'll never know if they decide to make 2 storey statues craftable.

Case in point - anyone wants to buy my ohii tree rubble for 5 mil?

 

[Fizzleton]

You and Raven have both claimed that the economy isn't broken, and then gone on to state several reasons that it is broken. The economy isn't merely the gold floating around, it includes the crafting systems you mention too. Also, hyperinflation isn't "regulation", it's a state of health, and a symptom of someone pushing the wrong buttons.

Well, I would love to discuss this issue in my mother tongue, since my English is sufficient for some talk and biology, but not economics. The point I tried to make was that you can, of course, discuss the "economics" of uo, and here the financial system. You can find arguments why or if constant gold influx is a "good" or a "bad" thing; my point is, that each system develops its own inherent reactions to any impact; inflation is one. But this is not the thing that should bother us. The real question is: Is this game with its inherent reactions fun to play! And this is the point where I say: no. Not because some "economics" is broken or not, but because it is not designed in a way that gives a fair share to the players of this game.

Why is that? If you decide - as developer - that there should be "runics" in the game to support the "crafter playstyle", and if you decide that the high end runics are capable of "crafting" insane armor and weapons, you open a worms can. You think you have a balance put in cause you designed the mechanisms giving those high level runics in a way that they should be rare events. However, your move was the first nail to imbalance anything, since the intensities of the "crafted" items are so overwhelmingly powerful that there is a strong demand for them the same moment they are in the game. Heartwood runic made bows are the only ones used in PvP, for instance; to be competitive in PvP as archer, u need such a bow. Since the demand for such items is so powerful, there is a strong incentive set to get those runics faster than merely by "normal" gameplay - in other words: there is a strong incentive set for multiple bod accounts (what is legal) but also for duping (eg. valo bods) and/or scripting (heartwood runics, brsk bods). So what you get with such a system IS duping and scripting; it is your own decision as a game developer that makes those systems arise! Now scripting and duping is a shady job; you risk your account and your reputation; so the "normal" gamer will not script and dupe. And considering multiple bod accounts - this is also left in the hands of some "crazy folks", not for the "normal" player (you designed the game for!). As a consequence, you leave the "market" of high level runics (and their products) to a few, and not at all to the majority of the players. Now you have an inbalance in the game that you never wanted: A few earn, in most cases with duping and scripting; and those few now set a new incentive: For "normal" players who want to stay competitive the incentive to make lots of gold to be able to get that one good pvp crossbow, or that nice bokuto, etc. etc. That is: you force players to go hunting to get the gold that will allow them to buy the powerful items they think they need to have to be able to compete. (and some take a short cut and buy those items or the gold they need with real cash). But all who do so do it with a strong feeling of anger: They feel that they are forced into a rat race they do not like at all; and what should be fun becomes some kind of crazy work.

This is the point where I would say the game is broken, but not economics; economics always functions as a game of demand and supply. The only question is if we like the game characteristics that derive from this kind of demand and supply.

 

[Harlequin]

All the money in the economy - all the money being traded between players in the high market - came into the system from that low market, and is supposed to be (by original design) leaving the same way. It's not. It stays in the system and inflates the currency, which in turn breaks the low economy for the wealthy, and makes the high economy impossible to break into for the poor. Classic sandbox. It's game theory 101, and our devs continue to fail it. Hell, no MMO has pulled it off to date.

Actually, if you are just thinking about gold leaving the game world, there is - Diablo 2 gambling

 

[RavenWinterHawk]

I quess one point is there are entry points for any player to join the economy. At market value. Granted you can make mistakes, get burned, or what have you. That is really part of the game.

HECK I spent 30 million on 3 pieces of rubble green plant that popped around the moongates. I speculated (since they were green) they would be rare. I figured all other plants would be "burned". Who would have know that the spawn that followed "burned" black plants spawned green.

My point is that the game offers many events. Rubble, Halloween Begging, Gifts, and more. Of course you have to learn how to sell them. Part of the game.


I think this is a pretty good thread. Hopefully, DEVS address the economy one day.

That is all views placed here. There are good tweaks here.

 

[Dicimiie]

I'm no economist. I'll be the first to admit it. But logically speaking, if you really wanted the UO economy to act like a real life economy, you would need to regulate the money entering the game world, and at the same time, make sure that money leaves the game world at the same time.

In my mind, a simple fix would be to add consumables that can ONLY be obtained through NPC vendors. These consumables would have to be desirable or very useful, and they would need to be sought after frequently. Make repairing armor and weapons have a consumable cost to it. Even if it's a small cost, some gold is being removed.

Another idea would be to take things that are already one time gold sinks and give them a shelf life. For example, housing is a huge thing in UO. Perhaps there could be a system in effect that allows for a house to wear over time, which would force the owner to cough up gold for housing upkeep.

I have several problems with the insurance concept that was put in place with AoS. Unfortunately, I don't see much of a tie between it and the economy. It is a minor gold sink, which is needed. I do, however, think the cost should go up with every death, as was brought up before. Give death some sort of consequence. Take some gold out of play.

If you seriously want to make the UO economy act like real life economy, I imagine you need think in real life scenarios. How does the UO government system run with no taxation? How are the guards paid? Who in Sam Hill created all of this gold that enters into the game?

There you go. A layman's idea of the issue.

 

[Der Rock]

some points to consider :

1.some here say:"new player cant afford the high end stuff" to compete in pvp/pvm

-they shouldn`t
because it is an MMO,so if u cant compete a monster or player, then find companions in arms.
over time u get stronger AND richer, u can afford/obtain the items u want/wish
logging in as an newbe and buying with a handfull of gold, all things u wish for, is against the meaning of an mmo.


2.some here say:"insurence killed the crafter"

-NO, the possibility to repair items with an 5 gold worth repair-deed killed the crafter
i say,let items get repaired with the DEMAND of resources, the higher the mods,the higher the need of resources.
and also, let crafter play with items(all items,including arties)
with the new skill "imbuing",for crafter it should be possible to make items "unique"
(f.i.:the holy knights breastplate arti, for 99% of player it is useless
so, let crafter try to enhance/imbu this arti,by using a high demand of rare-extremly rare resources,and a high possibility of braeking it.
maybe 1:100 will be a unique one with mods player ask for, so it will be worthy and crafter get a living again)


3.get rid of this dump vendor fee system
a daily % fee of the selling stuff makes "normal" player poor
it is a system wich force player to avoiding it, so the average player pay his vendor-fee and get poor over time, and the exploiter dont care about the fee, they simply avoid the system.
change it, tax a vendor if a item get SOLD
(this would bring back many vendors)


4.some say." LRC is part of the ruined econemy"

-thats right
selling regs these days is pointless
my idea about lrc(i posted it long time ago)would bring back the need of regs.
so,let us FILL spellbooks with regs,regular books 200 each reg,ecxeptional 500 each reg for example, then let come LRC into play,each 10% of lrc increases the spellbook charges,
voila, Regs are usefull again and LRC is still a good mod.


5.breaking items

-items that can breack is total againts the philosophy of player in modern mmo´s
player "love" his hard earned items.
if they breake, most will be upset, so worn out is ok, but breaking NOT
again, to bring back crafter,let crafter repair worn out items with the demand of resources.


6.a healthy economy is not only a question of gold

- keep player busy in ALL templates and playstyles helps the economy
supply and demand keeps the economy healthy,
but forcing player to do all the same is the death of economy.
give every template/playstyle special prospects, so that one playstyle is the supply and demand of the other playstyle and back.