Developer Diary 17 – The World Market and Buying

[unmerged(174694)]

So a British POP buying wheat from Norfolk or Autsralia would pay the same price (the WM price) as if it were buying it from say Argentina? That is buying internally would be the same as buying externally? Internal trade should have some discounts or other advantage over far away imports i think.

 

[King]

So a British POP buying wheat from Norfolk or Autsralia would pay the same price (the WM price) as if it were buying it from say Argentina? That is buying internally would be the same as buying externally? Internal trade should have some discounts or other advantage over far away imports i think.

Yes, isn't it amazing what those evil game designers will abstract to ruin your game expierence?

 

[RELee]

Yes, isn't it amazing what those evil game designers will abstract to ruin your game expierence?

(*evil game designer dancing dance of evil joy*)

 

[Subcomandante]

So the advantage of having a captive market is what?

 

[curtis]

Winfield Scott approves of the blockades feature.

 

[Macs]

As stated, the goods will be sold inside the internal market first. So if you wanted to import some small arms but your prestige is so low that it takes forever to actually get some, joining the SoI of, say, the USA could lead to you gaining them much faster, because you only have to "compete" with the other nations inside the internal market prestige wise.

As the GP itself the benefits are obvious, as you most likely are the most prestigious nation in the internal market.

 

[telesien]

Yes, isn't it amazing what those evil game designers will abstract to ruin your game expierence?

Ruin? Why the hell would implementation of law of one price ruin anything?

 

[Vricklund]

well, not quite correct. right now they will look at profitability when they do decide to switch, so are more likely (although not 100% certain) to go for high demand goods next

Ah, I see. This post threw me for a loop.

Good, so it means rational actions with probability of error. I can't agree more

Couldn't agree more.

 

[telesien]

So the advantage of having a captive market is what?

Well King is slightly vague here, but it looks like there will be difference in tariffs.
You see they influence the price of all goods your POPs buy (law of one price), but there is difference in who profits from them. In international trade it is the governement, in inside trade the producer. So we still don't know for sure, but some of us assume that when you are part of SoI you can sell your production to your partners and the increased price would go directly to your POPs making them richer and more able to withstand competition. Am I right, King?

 

[Subcomandante]

When the captives buy from the captor first, then the captor's goods should have less "lost" goods due to the higher demand. And vice versa.

 

[telesien]

When the captives buy from the captor first, then the captor's goods should have less "lost" goods due to the higher demand. And vice versa.

But I don't get why this is in to begin with. Say there's more production than demand and 10% of production is lost. On top of that the world price still falls (as mentioned in the DD), because the producers then start to undercut each other. Their problem in the V2 universe is though that undercutting does not solve a producer's problem because they are all in one boat - everybody sells 10% less so to speak. It's same as if the price falls 10%, but is still separate from the price.

So classic price war, when only the one with most effective production will remain

 

[Alexander Seil]

Well King is slightly vague here, but it looks like there will be difference in tariffs.

No, it's simply the purchase order that's the advantage. The GP gets dibs on anything sold within the SoI before it is available to everyone else. Obviously an advantage in case of relatively rare resources.

You see they influence the price of all goods your POPs buy (law of one price), but there is difference in who profits from them. In international trade it is the governement, in inside trade the producer. So we still don't know for sure, but some of us assume that when you are part of SoI you can sell your production to your partners and the increased price would go directly to your POPs making them richer and more able to withstand competition. Am I right, King?

The beneficiaries of trade in Victoria were always POPs, obviously it would have to be the same in Victoria II, with the only difference is that the "national stockpile" here actually does represent government warehouses. But otherwise sales in Vicky always forwarded the proceeds to POPs. You only recovered them through tariffs and taxes. The incredibly stupid thing about the first game was that the government had to pay for industrial imports with its own money - which is thankfully not the case anymore.

 

[telesien]

No, it's simply the purchase order that's the advantage. The GP gets dibs on anything sold within the SoI before it is available to everyone else. Obviously an advantage in case of relatively rare resources.



The beneficiaries of trade in Victoria were always POPs, obviously it would have to be the same in Victoria II, with the only difference is that the "national stockpile" here actually does represent government warehouses. But otherwise sales in Vicky always forwarded the proceeds to POPs. You only recovered them through tariffs and taxes. The incredibly stupid thing about the first game was that the government had to pay for industrial imports with its own money - which is thankfully not the case anymore.

Oh, so that is not the case? Pitty, but not tragedy.

Yes, when I wrote about government making profit I ment only income from tariffs collected. I should have perhaps written it more clearly. My point was tariffs make price higher by X and the difference is who gets the X; government or producer.

 

[KonradRichtmark]

So the advantage of having a captive market is what?

Getting the goods even if there is a shortage on the world market, and getting them right away. That is, without having to wait for the price to increase so much that production will follow suit and someone as low on the pecking order as you will get it.

 

[Subcomandante]

Getting the goods even if there is a shortage on the world market, and getting them right away. That is, without having to wait for the price to increase so much that production will follow suit and someone as low on the pecking order as you will get it.

But you don't get them cheap (the point of imperialism), and it won't help you selling your goods in the SOI (the other point of imperialism). Or rather, it helps you selling your goods, but you won't get more money doing it (by way of guaranteed sales) than if you sell it to the rest of the world (no guaranteed sales).

It seems to be the same when you fully annex territory - Great Power industry pays high world market prices to the locals for rare goods.

 

[Alexander Seil]

Also - denial of resources to others...

 

[Sovereign]

no if the world market is only buying 70% of production then only 70% is bought and 30% is lost.

This means money is lost doesn't it? 30% of the money would disappear?

edited to say no, I realize now that in fact it wouldn't.

 

[Subcomandante]

This means money is lost doesn't it? 30% of the money would disappear?

No it won't disappear because the buyers only give 70% in the first place. Only the goods are lost since nobody buys them.

 

[Snaake]

But there does need to be significant economic growth, since, after all, there was a whole lot more real wealth in the world in 1936 than in 1836 (and the decrease in the number of "Farmer POPs" needed to feed the world really allowed the explosive growth of industry). The real-world economy is not a fixed pie to be divvied up by the greedy exploiters of the proletariat. The trick, of course, is keeping growth on a realistic level so that wealth doesn't increase past the point of absurdity. Too little growth in production compared to population growth, and you have some sort of Malthusian catastrophe; too much, and you have immanentized the eschaton.

The fact that there will be no inflation or deflation in the game does raise somewhat of a problem, though. If the purchasing power of money doesn't increase as the economy grows (i.e. deflation cannot occur), how will people afford things? Or will we see this generalized drop in prices after all? Maybe Paradox is unintentionally leaving the two in the game, just essentially forcing everyone onto the gold standard (by eliminating minting and the resulting inflation). :rofl:

Yea, I just realised about the necessity of economic growth and put in a little mention as something of an afterthought. The difficulty is indeed reaching a balance, where the growth doesn't spiral out of control and break the system.

And what's so bad about forcing everyone on the gold standard? I mentioned earlier that this is quite historical. Although, it's a precious metals standard, to be honest.

...I think "why are my artisans not making machine parts, small arms, canned food, etc?" will be a pretty common question on the boards once the game is released.

Well yes, but you're likely to have several (small, but still) POPs of artisans sprinkled around, as will most everyone else, so the global supply of machine parts should still be more even, if not very large, in the start than in V1 (only GB had one factory, and there were hardly any on the market before something like 1850).

 

[unmerged(48056)]

As long as there isn't 20 production of wheat and 500 demand, like in Victoria. Things were so bad in the world that everyone from London to Beijing were eating mudcakes. :rofl: