Developer Diary 23 – Gold

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King

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Let us turn our attention to the final piece of the economic jigsaw. We have put a lot of effort in closing the loops in the economic system. However, we cannot escape one simple fact; the population will grow, thus money supply needs to grow as well. So where does the money come from? We thought about this and it hit us that gold is the answer.

Gold and silver coinage was still very popular back in the Victorian era. The Austrian School still looks back on this as the good old days. Even in countries that issued bank notes, these tended to be backed by gold or silver. Thus, we feel there is a link between the growth in money supply and the mining of precious metals. In our system precious metal is no longer a trade good, instead it gets converted straight into money, with the money being split between those working in the RGO and the government.

So, having hit on this solution let’s talk about the benefits. First up, the gold-to-money conversion rate is a fixed value in the defines file. This makes the task of mid to late game economic balancing a lot easier. If we think there is simply too much money in the system as the game goes on, we can simply reduce this conversion rate, or vice-versa. Thus, not only do we have a system that makes sense from the point of view of the era, but it also gives us an easier way to balance the economic system.

The other benefit is geo-political. Those pesky Boer republics, why do you want them? GOLD of course! There be gold there so you want to have them to control this source of revenue. This is part of our aim in the game design to create a game with historical feeling; we give you good in-game reasons to pursue policies that people did during the period.

So there you have it, where does money come from? We have removed the Victoria system of the World market just buying everything and moved over to a more historical and easier to balance model, with the added bonus that certain historical decisions become more attractive to the player. All in all we feel this is a win/win.
 

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Lloyien

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I like this. A constant and steady (and increasing) money supply; it will do a lot to combat the deflation and such that I would expect to occur without this mechanism.
 

Orinsul

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Will moving away from the gold standard as a decision appear, making less money be converted and it all go to the POPs or something.

And will POPs follow gold-rushes? or will they immgrate after one of them but then stay there forever?


ALSO BRILLIANT!
and im very happy to see named for provinces Armies
 

King

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I like this working system behind the economy, but what really is the practical application for players?

There is a direct and an indirect application here. Firstly gold is a strategic resoruce. It is something you want to own and thus you as a player will need to think about how you get your hands on these provinces, Dr Jameson are you ready?

The other effect is we aim to have an economic system that runs better. As a player you need money to do things, but it shouldn't be too easy. A more balanced economic system makes the game fun (i.e. your economy doesn't tank straight away like Victoria 1.0) while at the same time challenging.
 

King

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Will moving away from the gold standard as a decision appear, making less money be converted and it all go to the POPs or something.

And will POPs follow gold-rushes? or will they immgrate after one of them but then stay there forever?


ALSO BRILLIANT!
and im very happy to see named for provinces Armies

No our economic model always assumes that gold always backs your currency.

Demdends on the province, some provinces get timed modifiers when gold appears some don't.
 

Kriegsspieler

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So, having hit on this solution let’s talk about the benefits. First up, the gold-to-money conversion rate is a fixed value in the defines file. This makes the task of mid to late game economic balancing a lot easier. If we think there is simply too much money in the system as the game goes on, we can simply reduce this conversion rate, or vice-versa. Thus, not only do we have a system that makes sense from the point of view of the era, but it also gives us an easier way to balance the economic system.
King, I don't quite understand who the "we" is here. I take it that you're not referring to something that any player would necessarily have to do in the course of playing the game. Wouldn't it also be possible to control money growth by controlling the supply of gold?

Will provinces suddenly convert to gold, as they did in Vicky?
 

Ignudo

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could you please describe how this mechanism affects countries that have no gold supply of their own? If I understand things right their only way to get money into their system would be via trading with gold posessing states, right?
 

Orinsul

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also the mountains are pretty
Great Work!
 

telesien

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Gold and silver coinage was still very popular back in the Victorian era. The Austrian School still looks back on this as the good old days.

Try reading Money, Bank Credit and Economic cycles by Jesus Huerta de Soto. Magnificent book dealing a lot with the history of banking and the role of gold. In fact those good old days for Austrian school existed only in case of some banks like the Bank of Amsterdam :)

But I digress. What about small nations without any access to gold mines? Won't they be in bad position? Or will this be just solved by WM being open and changing prices all-over and redistributing wealth between nations? Is the mechanics of the spread of money and price changes across the world finished? Could it lead to some temporary crises?
 

Phelan

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In our system precious metal is no longer a trade good, instead it gets converted straight into money, with the money being split between those working in the RGO and the government.

How is the income for the miners and the government is calculated? I ask, because there is no world market price for gold any more. Depends it on the richness of the goldmine or the technology to exploit the gold mine?

So, having hit on this solution let’s talk about the benefits. First up, the gold-to-money conversion rate is a fixed value in the defines file. This makes the task of mid to late game economic balancing a lot easier. If we think there is simply too much money in the system as the game goes on, we can simply reduce this conversion rate, or vice-versa.

Or you can close some of the goldmine via random event. Gold deposits don't last forever!

The other benefit is geo-political. Those pesky Boer republics, why do you want them? GOLD of course! There be gold there so you want to have them to control this source of revenue. This is part of our aim in the game design to create a game with historical feeling; we give you good in-game reasons to pursue policies that people did during the period.

What about inflation for a nation with many gold mines. If you population doesn't grow at the same pace as your gold income there must be inflation!?
 

King

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King, I don't quite understand who the "we" is here. I take it that you're not referring to something that any player would necessarily have to do in the course of playing the game. Wouldn't it also be possible to control money growth by controlling the supply of gold?

Will provinces suddenly convert to gold, as they did in Vicky?

The We is Paradox Interactive of course. We have given ourselves a means towards a more balanced economy.

Provinces suddenly convert to gold.
 

King

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could you please describe how this mechanism affects countries that have no gold supply of their own? If I understand things right their only way to get money into their system would be via trading with gold posessing states, right?

Money has to circulate, the people who earn money off gold then go and spend it on the world market. The money then ciruclates around the globe.
 

King

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How is the income for the miners and the government is calculated? I ask, because there is no world market price for gold any more. Depends it on the richness of the goldmine or the technology to exploit the gold mine?



Or you can close some of the goldmine via random event. Gold deposits don't last forever!



What about inflation for a nation with many gold mines. If you population doesn't grow at the same pace as your gold income there must be inflation!?

The Gold mine produces X ammount of Gold per day, this is converted to money at a fixed rate, the value is found in our defines file.

We could do that, but we don't.

Inflation is global via the world market.
 

alvaro

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how are the prices created then?