Hello again and welcome to yet another walkthrough of some interrelated systems fundamental to Victoria 3’s economic model: Standard of Living, Wealth, Pop Needs, and Consumption.
All Pops in Victoria 3 have a Standard of Living score between 1 and 99, which represents - by a perfectly scientific and objective metric, don’t @ me - precisely how great their life is. Pops with levels 1-4 are labeled Starving, levels 5-9 are Struggling, and so on through Impoverished, Middling, Secure, Prosperous, Affluent, Wealthy, Lavish, and at levels 60+, Opulent. We don’t really expect a lot of Pops to reach levels 60+ but - knowing you folks - we’ve left plenty of headroom to accommodate your mad economic experiments.
Standard of Living affects two major aspects of the game: birth- and death rate, and Pop loyalty.
Birth rate is simply the percentage of children born to Pops each year, while death rate is the percentage of Pops who die. Both values start out high and decline with increasing Standard of Living, but birth rate declines slower than death rate, leading to a net increase in population growth with increasing Standard of Living. This system models that increasing Standard of Living tends to lead to longer life expectancy but declining natality. Each parameter can be modified independently by a variety of effects.
There are side effects to emancipation! But while reduced population growth here initially appears to be a penalty, increasing the proportion of industrial workforce at the same time tends to lead to increasing Standard of Living, which provides a net increase in population growth.
A Pop’s Wealth attribute forms the foundation for its Standard of Living. Pops can also gain more intangible boosts or penalties to their Standard of Living from any number of sources.
Pops accumulate Wealth over time while their weekly income exceeds their weekly expenses. Conversely, if a Pop’s expenses exceed its income, Wealth will decline. How large their expenses are depends on what and how much they consume, which is also dependent on their Wealth. What this means is that as long as a Pop’s income remains the same, and the cost of the goods and services in their state and market remains the same, that Pop’s Wealth will over time drift towards exactly the level of consumption they can afford to sustain. Of course, as Wealth changes the consumption also changes, which affects the prices of the goods in the market, which might in turn affect their wages, dividends, etcetera.
Each Wealth level is defined by a set of Needs and an amount of “value” that needs to be spent on goods to fulfill that Need. This “value” is defined in goods base prices, such that the Need for Standard Clothing for a Pop of size 10,000 with Wealth level 14 might be fulfilled by buying £87 worth of Clothes, assuming perfectly balanced supply and demand. If the actual price of Clothes where the Pop lives is over-demanded, their cost to fulfill this need will also be higher. As a result, cheaper goods means wealthier, happier Pops.
Some goods are favored over others by default if available. Once Electricity is available to them, due to its convenience Pops will prefer to buy it over Wood or Coal, even if they’re the same price. Some goods can be replaced by other goods entirely, while others will always be required to some bare minimum. Train travel can completely replace the need for having your own Automobile to drive around in, but having an Automobile doesn’t ever completely remove the need for an occasional train ride to see your cousin who lives all the way in Paris.
In addition to these factors cultures can develop Obsessions for certain goods, and some even have Taboos they must abide by. A country can also encourage or discourage the consumption of certain goods using Authority, perhaps in an effort to avoid enriching a hated enemy or entice Pops to buy something that’s heavily taxed over something that is not. This impacts the purchase habits of Pops affected despite this being irrational from a strictly financial perspective.
In Victoria 3 this formula is turned on its head. An Engineer is not intrinsically better than a Machinist who is not intrinsically better than a Laborer, and there’s no ideal national proportions between them you need to maintain in order to maximize your competitiveness. Different Professions do fulfil different functions, but it’s the Production Methods of the Buildings they work in that determine what function they serve. By choosing what Buildings to construct and which Production Methods to activate, you create the opportunities for these Professions which in turn impose changes to the population. What types of goods you need to ensure access to in order to keep your population satisfied is not driven directly by what professional opportunities you have created, but rather by what Wealth development and Wealth distribution these changes have resulted in.
In practice this means that it's important in both games to secure your populations’ basic needs to prevent starvation and dissent, followed by appeasing their desire for ever more advanced or exotic goods in larger and larger quantities to increase the size of your economy and power on the world stage. But while reaching this commonly pursued end goal in Victoria 2 often meant pursuing a certain optimal population distribution no matter what else happened throughout the game, the Professions of the Pops you end up with could be vastly different between games in Victoria 3! If you build a colonial plantation economy, your Aristocrats might remain as dominant by endgame as they were at start. If you're a manufacturing powerhouse on the cutting edge of technological progress, your middle strata Pops might come to rival the Capitalist class in wealth and power. If your high taxes are reinvested in vast Institutions your power base might be dominated by Bureaucrats and Academics. If your workers own the means of production, your Laborers might even be wealthier - and consume more luxuries - than your neighbor's Aristocrats.
These possibilities for diverse Pop distributions also result in very different political tendencies in your population, which lead to demand for different kinds of Laws. While in Victoria 2 it’s primarily the rising Consciousness of a greater ratio of more advanced and literate types of Pops that drives a desire for reform in a liberal direction, Victoria 3’s more open-ended consumption model and the diversity of Professions it can create could result in your population having very different political desires by endgame depending on the path you’ve taken. This requires your political machinery to be working in tandem with your economic engine, both to create the right conditions for your Pops and to satisfy their changing desires.
Next week, we will learn more about these desires as Martin introduces us to Political Movements, which themselves are strongly connected to Standard of Living. Until then!