Laissez-faire and Capitalist AI

I gave up and shifted my party to state capitalism. That worked.

The current LZfaire governmental system doesn't work as well as I was hoping for insofar as factory building.

ozmono2005 said:

By setting Tarriffs lower you are making it easy for foriegn nations to sell there goods. So you are really making it hard for your factories as foriegn goods are cheaper.

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That's actually an excellent point I completely missed. Only set tariffs negative if your capitalists can't afford factory inputs and you're primarily selling finished goods - otherwise subsidized imports will undercut domestic production.

For me they seem to set up factories perfectly well, but then the things seem to go out of business at exactly the same rate ¬_¬

In my experience you need to build up some base industry yourself first.
If you imediatly go Laissez-Faire then the factories tend to close realy fast, because the capitalists don't make enough money.
But if you already have a couple of profiting factories then they will have an easier time.

The only problem is you need to keep using your national foci to promote craftsman indefinitely because all your craftsman are always starving and turning into different kinds of pops. So if later on for example you decide to use your national foci to colonize the world instead, your workforce will start disappearing at an alarming rate and your economy will crash. The hordes of constant rebel spawn are fun too.

Baldamundo said:

For me they seem to set up factories perfectly well, but then the things seem to go out of business at exactly the same rate ¬_¬

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That's a good point: I wish factories had some sort of grace period in which to become profitable. I've seen some close the same day they opened. And then get destroyed that same day, as well.

Laissez-faire parties are usually anti-military and it doesn't stop with limiting your military expenses.

Those military techs will have to wait, focus on commerce and industry technology, they make your factories a lot more viable. Use your NF to encourage capitalist, I don't have to tell you they're the lifeblood of your LF economy. Do NOT encourage POP's to become soldiers by raising your military spending. You need those guys in your factories, not in uniform.

My experiences with LF are mixed. In the same country, I've seen certain states boom under LF, while others went totally bust.

I personally prefer interventionism, as it gives the most tools to help the capitalists. I know some of the other devs like LF best and some prefer SC.

After a few abortive experiments with laissez faire, there's no way I'll even consider allowing my capitalists to run the economy: they're just... too stupid. Then again, I haven't played as a large country like the USA or Russia yet, and I can imagine LF could work a little better for one of those.

I set my tariff to 30% to force my people to buy within the country, this also allows me to reduce taxes for capitalists and middle class to 0%,
If you use negative tariff's your making foreign markets far more competitive then your own market, why would one use negative tarriff's anyhow?

Balor said:

I personally prefer interventionism

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So far my personal favourite too.

I've learned though, that at some point, you just have to let a factory go anyway. When I started playing, I often stubbornly refused to let factories die, subsidizing them come hell or high water. It wasn't helping anyone though. The POP's working there weren't making enough money and it was costing mine.

The truth is that this is probably realistic. For example, while it was the private railroads that built the US rail network, said network was heavily subsidized by the government.

Honestly, getting stuck with an LF government jammed me up as Transvaal for a while because I didn't have many places to develop my industries. My largest factory went upside down almost immediately (and it was generally profitable, too!) and towards the end of the game I've managed to get into Great Power status with an industrial score that's not yet above 7 (and I think I made it to 6 or 7 on the scoreboard with a score of 1).

Interventionism is the death of industry playing as Brazil. They don't have the tech in the early stages, but the capitalists all want a factory or two to play with.

So, they build Canning Factory, which is a collosal LOSER. It opens up, and my income immediately plummets. So, I stop subsidising it, and it closes.

Brazil doesn't have fish or iron, and for some reason it also needs cement (? - I ain't eatin that) With Trade on AI, the factory starves and closes.

Those idiot capitalists built about 6 or 7 factories for stuff that I had no local supply for, and refused to build factories for the stuff I did have, even when I used the special button at the top of the provice window.

I forced a CS government in at one point so I could see if I could get some successful factories going. I set Coal to manual in the Trade, and bought up a large surplus, then built a Glass factory. The Trade page said I had 200 units in storage, but the Factory said I didn't have enough coal to meet the demand. I ran it on subsidise for a while, but it just kept eating money, so I closed it.

Same thing with a Lumber factory. Now, I have plenty of province chopping wood - normal wood too, not just the exotic stuff. Surplus in Trade, and insufficient supply for demand in factory. It also starved to death.

So, my question is - how do you get the surplus in the Trade window INTO the factory?

I did all of this with no problems in Vicky 1, why isn't it working in Vicky 2?

:wacko:

I lose a couple of good factories too in the hands of the brilliant capitalists after switching to a LF party.

Same here, game is unplayable from 70's-80's, when all major countries subsidize 95% of their industry and ran up huge debts. I am very surprised at how long subsidies can go on, some countries are spending nearly 50% of their expenditure on subsidies but they will not run out of cash until national bank has it.

Well, as an economist I have to say that the balance between the single
economic policies is not clear to me.

While I am not sure what exactly is meant by Laissez-faire (this is a term
french rationalists used to describe a theoretical optimum they believed in),
I think it is meant in the way that the state interfere´s in the economy
as less as possible. Yet, historically, that would be interventionism, since no
state ever completely refrained from taking influence. Nevermind.

The serious problem I see is that countries with a more liberal economic
policy did industrialize much faster than others, who tried to influence
the economy more. This was due to the enormous advantage in
information that the private investors (here: "Capitalists") possessed in
relation to the governments. While it is true that railways where heavily
subsidized in most countries, the governments paid the subsidies
because the "Capitalists" told them this would be useful. In the game
however, it is completely the other way around. The player knows of
course which factory will run good, while the "Capitalists" seems to have
no idea what they are doing.

Maybe this is an AI problem and you can make the "Capitalists" smarter.
If not, than I would suggest to alter the effects of the single economic
policies. Every step towards more state influence should have severe
effects on productivity. "Laissez-faire" has 100%, Interventionism 80%,
state capitalism 50% and planned economy 20% (for gameplay reasons,
in reality a planned economy has 1 or 2% in the long run...).
Also a step away from a liberal policy should have an EXTREME effect
on research (maybe not in the cultural field), since most innovations, let
alone inventions, were made by entrepreneurs. So a non liberal policy
should make own research nearly impossible, yet than there should be
a way for the technologies to diffuse from one country to another
(which again would be the historical route).

I had a game where I took a socialist government and yet had the most
modern industry in the world. While this is possible for the time right
after the planned economy was installed, it can not hold true in the long
run, since a planned economy is not good in researching new high tech
industries (yet it is capable of using things which are already there, like
the Nazis in Germany or the USSR).

As a last remark I would like to add that the switch from a even nominal
liberal policy to a planned economy should have severe effect (revolts,
capital problems) on the countries, since there are losers to this. The
same goes the other way around.

My excuses for the long post. Yet, the economist inside is really buged
by things like this...

To the poster above me...

It is a period of civil war.
Rebel spaceships, striking
from a hidden base, have won
their first victory against
the evil Galactic Empire.

Sorry, but I am not very used to make such long form posts and
wanted to keep it readable .