AHD Economy Discussion

[Secret Master]

If you aren't selling half your goods at red prices, I'd guess you are indeed overproducing everything. That is, supply exceeds demand by far. I don't know how is such a situation an argument against my idea/theory/opinion (which might be flawed nonetheless) that demand exceeding supply by far (the opposite of what is in the screenshot) can in some cases (e.g. very poor POPs) hurt the economy?

Also, as someone has mentioned, demand calculation might have been patched since the version I use to exclude the wishes of dirt-poor POPs.

Well, your post indicates that prices rise because of a problem with high demand (goods desired) versus the actual number bought (actual demand) causing POPs to have unfulfilled demand. The unfulfilled demand results from higher prices (demand) that make goods unattainable for POPs that might otherwise be able to purchase them. Instead, what I see is that prices keep dropping making the goods more accessible to more POPs, meaning that I sell more gross units, but the percentage of units sold continues to decline. High prices aren't causing economic problems for me in AHD. Nor is screwed up demand. I'm suffering from such high efficiency that prices will continue to drop, eating at my profits, while I don't sell lots of extra units.

[Xylander]

Actually it shouldn't be able to sell at 1.20 in that case. Once there is more wine on the market than sells at the price the game sets, the game price is too high and it has to compensate in some way. Since it uses a command method to set the price, the compensation is trashing surplus product. If it used a market method for setting the price, the price would move to match supply and demand.

In this situation your factory is a marginal producer. However the game economy is structured, its not going to make a profit. That's what happens at the margin. You sell 5/6 of your production at 1.2 or all of it at 1.0 but the end result would be the same. No profit.

That's by no mean the same! If the price stays at 1.2 my pops have to pay 1.2 for it, while tons of the same stuff are thrown away. If the price dropped to 1.0 more could be sold and they would get their needs satisfied. Maybe the factory wouldn't make profits but I would understand what the problem is (production cost > market price).

[Naselus]

That's by no mean the same! If the price stays at 1.2 my pops have to pay 1.2 for it, while tons of the same stuff are thrown away. If the price dropped to 1.0 more could be sold and they would get their needs satisfied. Maybe the factory wouldn't make profits but I would understand what the problem is (production cost > market price).

The game uses a ratio method to determine price fluctuation. This is convenient, but not very accurate at large volumes of sales - say you're producing 10 cattle selling at £1 each, but there's only room on the market to buy 9, then the price can drop by 10% to £0.9. Now say you're producing 10,000 cattle, but there's only money on the market to buy 9,994. The price needs to be able to drop by 0.006%, which it cannot do since prices aren't measured that accurately - it'll only drop in price once the ratio change is greater. The price of cattle will never be £0.9994 on the markets. This is another method by which very small POPs bork the equations, and so is another of the reasons why they don't appear to use them.

Economic magnification - that is, increasing the scale of production and consumption by factors of ten - once again helps to alleviate this problem a lot, by dragging more and more POPs into 'meaningful' consumption... but forces you to pay an enormous price in system overhead.

Quite simply, the problem can be fixed, but then most people's computers almost certainly wouldn't be able to run the game. PDM only really goes half way to fixing the issue, but already has a lot of people complaining that it's too slow to play.

[Xylander]

@Naselus: It would be much easier to accept if some screens were less misleading in what they tell the player (see e.g. Why does glass not get sold when there is high demand on global market ? -> screenshots).

I'm not happy with the way the game handles pricing but I can adapt to a game mechanic when I understand how it works. And for most stretegy game one has to accept way more tradeoffs (e.g. moving a military unit across the map takes longer than building a new factory or things like that) than in Victoria 2 AHD!

My problem is that
A) Nearly nothing is explained in any kind of manual (even the strategy guide is, for my opinion, of little value). You have to spend many hours reading through forums event to find out what military hospitals do (to know what the bonus to it does). There are at least lots of bonuses given by techs that are not explained. How should I make a decision what to research? I can't event deduct the use from visible effects as an 1% bonus to something might be hardly noticeable if you don't know what to look for!

B) Terms are chosen suboptimal (e.g. at least in German the tech increasing your factory throughput is called a type of "efficiency". But it does not make your factory more efficient!)

C) Screens show misleading numbers (see link above for examples), e.g. the Trade Screen showing what your people want to buy regardless of what they are able to pay for. You find youself trying to satisfy a mostly virtual need. There are cases where a populous unciv colony can give you numbers 10 to 100 times higher than what people will buy in the end (if you play a country with a small population in its 'states'). Not to mention screens that show numbers that I recognize as wrong ( though there might be something I don't know that makes the number right ... see 'B' above for that)

So I think the perceived quality of the implemented economic model could be significantly increased not by changing the code but by improving ingame documentation and manual!

[Naselus]

A) Nearly nothing is explained in any kind of manual (even the strategy guide is, for my opinion, of little value). You have to spend many hours reading through forums event to find out what military hospitals do (to know what the bonus to it does). There are at least lots of bonuses given by techs that are not explained. How should I make a decision what to research? I can't event deduct the use from visible effects as an 1% bonus to something might be hardly noticeable if you don't know what to look for!

The old V2 manual and strat guides are both quite out of date, but the AHD one is fairly informative with regards to the changes it had. But yes, manuals have always been something of a weak point for Paradox.

B) Terms are chosen suboptimal (e.g. at least in German the tech increasing your factory throughput is called a type of "efficiency". But it does not make your factory more efficient!)

That's questionable; throughput IS a type of efficiency. I usually divide it into 'time efficiency' (throughput) and 'material efficiency' (input/output changes). VRRP uses the terms 'throughput' and 'efficiency' pretty much interchangeably, which to my mind makes no sense either, but really, there's little point in quibbling over terminology.

C) Screens show misleading numbers (see link above for examples), e.g. the Trade Screen showing what your people want to buy regardless of what they are able to pay for. You find youself trying to satisfy a mostly virtual need. There are cases where a populous unciv colony can give you numbers 10 to 100 times higher than what people will buy in the end (if you play a country with a small population in its 'states'). Not to mention screens that show numbers that I recognize as wrong ( though there might be something I don't know that makes the number right ... see 'B' above for that)

No, the trade screen doesn't show what people want to buy regardless of what they can pay for. Let's try to get this very, very clear, as I've stated it over and over again in this thread and about a dozen others - Demand and Real Demand are separate values in the game, and you are not shown the one which shows total possible world demand for an item in the retail version of the game. The Betas DO see that number in addition to the 'real demand' that the retail version displays, and it is massively higher than you will ever see in the retail version. If you wish to see 'desire', then go into a savegame and look at the 'demand' figure. That is maximum demand in the world. 'Real demand' in the savegame is what you are presented with in-game as 'demand', and that's a vastly smaller number. Check some of the Modder's Heaven market reports to see the difference in scale between these two numbers.

There is NEVER a situation in the game where a populous colony will give you demand numbers 10 or 100 times higher than they can afford to buy. In fact, the more populous a colony is, the less likely it is to suffer distortions, since only very small POPs cause distortion and a very populous colony by definition DOES NOT HAVE small POPs. This is why d=!d traps are almost always less than 10% of the total demand for a good, and rarely go over 1%. There's no such thing as a 'mostly virtual' need, and there hasn't been since 1.2 was released. Please, please, PLEASE stop saying that there is, as it's a patently false, amply disproven hypothesis (one that I came up with in the first place, incidently, and then went on to disprove as well) which merely muddies the waters on what's actually happening in the marketplace.


There are certain cases of interface bugs which provide misleading numbers; production and trade have almost none of these left anymore. You're pretty much seeing exactly what's happening in the game in those areas now. Population is the main culprit here, with the old migration/pop growth bug etc.

And yes, the manual could be better; the same can be said for all Paradox games I remember HOI1's manual which contained almost no useful information about how to play the game, but did have lots of interesting historical facts in boxes about how Rommel owned three cats. Vicky 1's was even worse in that regard, tbh. The V2 documentation is far from perfect, but is still leaps and bounds ahead of where Paradox were even for EU3.

[Beagá]

Vicky 1 economy and industrial demand model is more intuitive than Vicky 2, no doubt. Simpler too, so that can be expected.

One thing that still makes me pull my hair is how NF industry types still makes a small difference in Vanilla AHD... For example in my first beta game as Spain, the third industry built was artillery, the fourth explosives... closed the artillery factory, used 3 (3!) NF to stimulate other industries and what happens?

Capitalists want to reopen the artillery factory then build ANOTHER one.

FUUUUUUUUUUUUUUUUUUUUUUUUUUUUUUU

[Secret Master]

Vicky 1 economy and industrial demand model is more intuitive than Vicky 2, no doubt. Simpler too, so that can be expected.

It was also a silly model of economics. Everything produced was bought BY the WM. Then it would sell items to whoever wanted them. If it didn't sell everything, it would just store it under the Earth's crust. Countries never reached a point where all goods weren't sold because the WM would buy it all with money conjured out of thin air. You could literally pave the planet in steamer convoys and never have an economic problem. The prices would drop, but you never had a problem selling anything.

Yeah, it was simpler, but it was also a model of economics that never had anything to do with real life.

[espana33]

Just want to say thanks Naselus for the answers!!

I think i'll mod more goods in that case into my version of PDM and see what it does to my PC & performance.. PDM runs prettyquick for me now and I'd be willing to pay for the performance hit .. maybe.

[Secret Master]

No, the trade screen doesn't show what people want to buy regardless of what they can pay for. Let's try to get this very, very clear, as I've stated it over and over again in this thread and about a dozen others - Demand and Real Demand are separate values in the game, and you are not shown the one which shows total possible world demand for an item in the retail version of the game. The Betas DO see that number in addition to the 'real demand' that the retail version displays, and it is massively higher than you will ever see in the retail version. If you wish to see 'desire', then go into a savegame and look at the 'demand' figure. That is maximum demand in the world. 'Real demand' in the savegame is what you are presented with in-game as 'demand', and that's a vastly smaller number. Check some of the Modder's Heaven market reports to see the difference in scale between these two numbers.

I didn't know desire from POPs was that much higher in the late game than actual demand (goods bought). I checked it out in my last save game, an the difference between the two is just what you said it would be. A difference of over 10x, between actual liquor bought versus liquor demand alone.

This tells me that when I've been thinking about how to improve the late game economy, that my suspicions have been correct, but understated. I've wondered whether the solution to over saturation of demand might be helping other countries industrialize so their POPs can buy more stuff (which would ultimately include my stuff). I didn't know just how much stuff POPs would be willing to buy if they could afford it. My factories have not even begun to touch the upper limits of desire from POPs.

The catch, of course, is how am I supposed to help POPs around the world get a better standard of living so that they will buy my stuff. What can I do to stimulate demand abroad once I've got demand at some taken care of? POPs want to buy stuff. Enough stuff to keep my factories in business. But they can't afford it.

Is there any way to make prices more flexible? If prices could keep dropping like a stone, I might at least get to sell more units.

[Naselus]

Making prices more flexible would require messing with the pricing algorithm, which I doubt anyone would like to try after the various 1.3 public beta models. The main problem is, ultimately, concentrations of cash. There's a couple of ways round this:

1) Up the worker's pay. This can be done using the minimum wages script from issues.txt.
2) Change the paycheck value in defines.lua. If you increase this, POPs take home more money - but factories are more likely to go bankrupt.

[espana33]

Making prices more flexible would require messing with the pricing algorithm, which I doubt anyone would like to try after the various 1.3 public beta models. The main problem is, ultimately, concentrations of cash. There's a couple of ways round this:

1) Up the worker's pay. This can be done using the minimum wages script from issues.txt.
2) Change the paycheck value in defines.lua. If you increase this, POPs take home more money - but factories are more likely to go bankrupt.

Is there any way you can think of to make wages float? In game mechanics I mean, we can write events to do it right? Is there any trigger to make it based on capitalists savings rate? or some similar other worthwhile metric?

[Secret Master]

Making prices more flexible would require messing with the pricing algorithm, which I doubt anyone would like to try after the various 1.3 public beta models. The main problem is, ultimately, concentrations of cash. There's a couple of ways round this:

1) Up the worker's pay. This can be done using the minimum wages script from issues.txt.
2) Change the paycheck value in defines.lua. If you increase this, POPs take home more money - but factories are more likely to go bankrupt.

I figured that would be the answer. I suppose I could "soak up" POP cash via massive government spending while never increasing taxes. This would cause me to eat loans (eating POP cash) while buying up more goods. If I am willing to go bankrupt , I could "spend" all that money, since paying it back would just return money back to where I got it, plus interest.

It's been awhile since 1.3 beta patches. What made people so unhappy about the pricing model. I forget.

[TiggyFiggy]

Unemployment levels correspond to proportion of profit paid to workers, with some modifiers of course.

[The Arch Mede]

I didn't know desire from POPs was that much higher in the late game than actual demand (goods bought). I checked it out in my last save game, an the difference between the two is just what you said it would be. A difference of over 10x, between actual liquor bought versus liquor demand alone.

This tells me that when I've been thinking about how to improve the late game economy, that my suspicions have been correct, but understated. I've wondered whether the solution to over saturation of demand might be helping other countries industrialize so their POPs can buy more stuff (which would ultimately include my stuff). I didn't know just how much stuff POPs would be willing to buy if they could afford it. My factories have not even begun to touch the upper limits of desire from POPs.

The catch, of course, is how am I supposed to help POPs around the world get a better standard of living so that they will buy my stuff. What can I do to stimulate demand abroad once I've got demand at some taken care of? POPs want to buy stuff. Enough stuff to keep my factories in business. But they can't afford it.

Is there any way to make prices more flexible? If prices could keep dropping like a stone, I might at least get to sell more units.

You have to make their technology similar to yours. They can't afford to buy lots of stuff unless they are selling lots of other stuff and that comes down to having tech bonuses that are similar to yours. Dropping prices reduces the ability to pay by the same amount as it reduces the cost to buy.

Conquer the world so that everyone has the benefit of your tech bonuses.

Or put significant taxes on your people and find a way to pay the the money out in foreign aid. As long as your people are much more productive than foreigners, you have to give money away if you want them to be able to buy similar levels of goods. -100% tariffs and close down areas of your industry so that there is something that your POPs are buying which is subject to them.

[paulthebug]

I think the econ model toward end game leaves a lot to be desired.
I kept getting into economic problem by 1900 or so.

All the goods are overproduced (with the exception of rubber-based products), under L-F economy, my unemployment is shooting through the roof and causing huge amount of militant. Any advice?

Also, those dye producing provinces in India pretty much fire all the farmers after synthetic dye is discovered. How do one deal with that? Any idea?

[Kamerat Roe]

Reading this thread I feel we get a glimpse into the frustration of real-life leaders of the era.
I mean, "over-production crisis" isn't exactly a new term.
Neither is the hunt for new markets, the saturation of existing markets, the downwards spiral of unemployment and demand or the resulting riots from a serious crisis.
Keep up the good work Paradox!

[marnues]

Reading this thread I feel we get a glimpse into the frustration of real-life leaders of the era.
I mean, "over-production crisis" isn't exactly a new term.
Neither is the hunt for new markets, the saturation of existing markets, the downwards spiral of unemployment and demand or the resulting riots from a serious crisis.
Keep up the good work Paradox!

Yes, it is awesome that we encounter real-life issues in the economy. It'd just be better if the mechanisms leading to these issues were life like! I really wish I could tell my highly over-productive steel mill to drop it's prices undercutting the competition and increasing demand for steel (as more people can now afford it).

[WolfSnakeCaffer]

Having read only the opening post, I can certainly say that me and Heilloki have different problems. For me if I have an industrial score of 200 or more in 1900 (normally I do not, unless I am playing as a European great power or USA) then I will normally have an industrial score of over 4000 by games end.

Normally what I do is if I want to play a non-great power is I play as Songhai until African colonization starts and then switch over to a country (Normally Sweden, Italy or Japan) that has a good industrial score but isn't a great power. If I do this I have won the game (aka first place in 1935) as all 3 powers, but starting the game as Sweden or Japan or one of the various Italian powers I can never get that far.

I guess that I have to ask for advice on good ways to kick start my economy, as once I it gets moving I can get it to move quickly.