Money Flows & Creation

[unmerged(63310)]

As I recall, most of the goods in Victoria were not necessarily consumed by governments (for factories), but by the POPs themselves. In Vicky 2, I imagine this will remain the case; but, because money is going to be "enclosed" in the system now, is there going to be any need for a price floor or ceiling for goods?


In Victoria II, will we be able to see unemployment as the price tries to reach an equilibrium with production? The labourers working those RGOs shouldn't be able to support their needs with what they should be paid for the price of coal, once production hits its stride. Hopefully, this'll lead to labourers emigrating to other, more profitable RGOs.

I had just assumed from V1 and earlier dev diaries about production that there would be price floors and ceilings or at least weighted prices. I can't see open auction bidding on new goods for instance or something like fish becoming worthless because of overcapacity. Since the amount of goods are limited as well as the jobs and labor has minimal switching costs there would have to be some min or max price functions.

Because even with floors and ceilings there could be a wide range and 100k POPs producing a good that is selling for near the max price could become quite poor very fast if it went to the min price and enough POPs leave to get a new job that the price climbs to again profitable point. If there is no min point especially then that would be nightmare to balance I'd guess. Even no max price would be problems as even wealthy capitalists could quickly totally impoverish themselves bidding to own the first automobiles.

 

[unmerged(63310)]

Actually I think in the game reactor's presentation video Johan exlains that money is only generated from gold (or something like that). But this has to be confirmed I agree.


Well I understand what you mean but this is actually the problem for me : RGO (as factories) will create Value but not money which are completely different. Which means there might not be enough money to buy those RGO's goods, and this could decrease prices. In a more global way it is clear that total production and population will tend to grow but money available might not grow accordingly... which I suspect could create imbalance problems.

By the way the cheating effect on economy is interesting too. The question might be : how is the ingame economy going react to surplus or lack of money?

The WM sets the price for the RGO goods determined by the balance of supply and demand which is what sets the value. So you are right that RGO doesn't produce money but the WM does initially and would continue doing so minimally as efficiency of RGO improves as well as if there is floor on prices of goods.

Since all goods pass thru WM(aside from internal consumption though I think King made some reference that now for internal use countries even buy goods from WM though I think that was a hard to understand statement) the WM acts as the price controller. So V2 probably can't totally escape the complaint about marxism leveled on V1. Though really for a game or even simulation with more than a handful of goods that is necessary. Otherwise it is quite complicated to make a POP determine what price to pay for what quantity of goods... the basic good with the highest demand could otherwise rise right past the point most POPs could afford it and since POPs don't die from lack of food the rise in militancy would take quite awhile and POPs switching into the job to create that basic good would need to be nearly instant for prices not to experience rapid large swings and thus POP ideology shifts as well with POPs rapidly changing jobs to balance out price shifts.

 

[unmerged(92421)]

I think somebody has been playing EVE online As we all know, money doesn't magically appear or disappear in EVE, which is one of the reasons it is such a wonderful game;

Yes it does.

You do missions and get rewarded isk. This isk is generated from nowhere. Or you spam the character create button and send that isk to someone else, that's also nowhere. You shoot baddies with a bounty, isk from nowhere. You sell something on the market and pay transaction tax, isk TO nowhere. You buy insurance and don't claim it, isk TO nowhere.

 

[HappyBanker]

Otherwise it is quite complicated to make a POP determine what price to pay for what quantity of goods...

I completely agree with this. This is a very high difficulty AI choice. Trying to implement such a system would imply to have populations make "predictions" about prices and therefore accept prices accordingly... which I think is clearly out of reach for the moment.

Thus the interrogation goes back to the determination of prices on the WM. As I have no idea how this was implemented in Vic1 I am really not sure what could be keeped or improved. Does anyone knows how supply and demand was dealt with ? Were there prices caps and floors ?

 

[KonradRichtmark]

I think somebody has been playing EVE online

I'd rather guess, somebody has been observing how the real world works

I made a similar query a while back, and I didn't know anything about EVE online. And since I got the whole idea from how the dev diaries said that slider expenditure would go into the pockets of particular POPs, I suspect Paradox has been thinking this all along from the start.

 

[King]

We have been thinking that way. Basically my own feeling is that the Victoria economy is balanced at the start, but as the game goes on the money supply grows at such a rate that the economy gets increasing unbalanced. Essentially the more we control the ammount of money that enters the economy the easier it becomes to balance as we have fewer numbers that can upset the apple cart.

 

[KonradRichtmark]

Since all goods pass thru WM(aside from internal consumption though I think King made some reference that now for internal use countries even buy goods from WM though I think that was a hard to understand statement) the WM acts as the price controller. So V2 probably can't totally escape the complaint about marxism leveled on V1. Though really for a game or even simulation with more than a handful of goods that is necessary. Otherwise it is quite complicated to make a POP determine what price to pay for what quantity of goods...

Well, a simple solution that wouldn't require much computation would simply be to order all goods of the same necessity level (subsistence, everyday, luxury) according to current price, rather than left to right. Or, order them according to "relative price" (assuming there even is such a thing as "base price" of a good). That'd make POPs go after what's cheap, rather than making them hang up on that one good which every POP of their type is trying to outbid the others for.

For dynamic supply and demand to work, POPs would have to be able to do at least a minimum of switching consumption patterns. I think the above suggestion isn't too complicated.

 

[RedRalphWiggum]

We have been thinking that way. Basically my own feeling is that the Victoria economy is balanced at the start, but as the game goes on the money supply grows at such a rate that the economy gets increasing unbalanced. Essentially the more we control the ammount of money that enters the economy the easier it becomes to balance as we have fewer numbers that can upset the apple cart.

But surely the applecart should get upset from time to time? Or do you mean it gets upset in a totally gamebreaking way?

 

[King]

But surely the applecart should get upset from time to time? Or do you mean it gets upset in a totally gamebreaking way?

I do feel that it is a game breaking way. There is simply too much money in the system in the late game.

 

[RedRalphWiggum]

I do feel that it is a game breaking way. There is simply too much money in the system in the late game.

Fair enough. Maybe you could add some sort of 'currency revaluation' event to deal with it. I'm sure there's a million things wrong with that idea, but I'm not an economist and neither are most players, so you might get away with it!

 

[alvaro]

We have been thinking that way. Basically my own feeling is that the Victoria economy is balanced at the start, but as the game goes on the money supply grows at such a rate that the economy gets increasing unbalanced. Essentially the more we control the ammount of money that enters the economy the easier it becomes to balance as we have fewer numbers that can upset the apple cart.

as I see it, if you let prices flow with the money it must balance itself but at the same time you have to provide a system that makes the offer of products respond to money growth. i mean, more money -> more price -> more profit -> more capital -> more investment in factories of the kind. be it by capitalists or by governments, doesn't matter. the only variable to finetune is how much money you can put in the market and its cost.

in a perferct world the mass of money should grow in the same level as the production. so in macronumbers for the game engine, if you have the current adition of the value of all sold goods and the adition of the value of all needed goods (when everyone can buy what he needs) you'll get the min and max points for a safe amount of money needed in the market. max will lead to no willingness to invest and min means an expansion at gates (and probably social turmoils as well).

and i don't want to drive you to a conversation revealing a future dd just my thoughts.

 

[safferli]

Well, a simple solution that wouldn't require much computation would simply be to order all goods of the same necessity level (subsistence, everyday, luxury) according to current price, rather than left to right. Or, order them according to "relative price" (assuming there even is such a thing as "base price" of a good). That'd make POPs go after what's cheap, rather than making them hang up on that one good which every POP of their type is trying to outbid the others for.

For dynamic supply and demand to work, POPs would have to be able to do at least a minimum of switching consumption patterns. I think the above suggestion isn't too complicated.

I like, substitution effect ftw!

EDIT: on second thoughts, it might be too complicated to code: you'd have to recheck every price for every POP everywhere, instantly. And then recheck, as buying a single good from the WM would have changed the prices again... Ah, the beauty of the market, that does all that without any problems!

 

[KonradRichtmark]

I like, substitution effect ftw!

EDIT: on second thoughts, it might be too complicated to code: you'd have to recheck every price for every POP everywhere, instantly. And then recheck, as buying a single good from the WM would have changed the prices again... Ah, the beauty of the market, that does all that without any problems!

That's what you'd call a straw man in polite company . All POPs making their daily purchases simultaneously might not be technically accurate, but close enough. It's not like the real world market reacts at lightning speed either, well, except for the stock market perhaps.

How much computing would it really require? The only thing POPs would do which they wouldn't in V1 would be to, every day, sort all goods within every need bracket according to relative price. If that's too much a drain, the re-computation could instead be done weekly or monthly. It wouldn't be quite as fluid, but heck, V1 made it with entirely static consumer preferences.

 

[safferli]

I like it a lot. The implied assumption that POPs don't care what subsistence goods they buy, just any of them isn't too problematic I think. Even if they only buy liquor for their subsistence needs and no foodstuffs...

One could even enter "minimum subsistence good levels" to combat that, if it feels too unrealistic. Say 1 unit of foodstuffs, 1 unit of liquor is the minimum, they'll buy regardless of price, and then the rest of the subsistence goods are bought relative to current market prices.

EDIT: One would need to say split the populations into n parts, each part buying on day n, and not buying on other days, to avoid infinite loops: without parts, everyone jumps and buys good 1 for all their needs, then the price of good 2 is low, so everyone jumps to good 2 the next day. Then, good 1 is low-price, so everyone jumps to good 1 on day 3, and so on. If only 1/n of the total population can buy a good, then I think that a market equilibrium might be possible.

 

[KonradRichtmark]

I like it a lot. The implied assumption that POPs don't care what subsistence goods they buy, just any of them isn't too problematic I think. Even if they only buy liquor for their subsistence needs and no foodstuffs...

If I remember correctly, V:R moved liquor from subsistence to everyday goods to make it impossible to live off booze only.

EDIT: One would need to say split the populations into n parts, each part buying on day n, and not buying on other days, to avoid infinite loops: without parts, everyone jumps and buys good 1 for all their needs, then the price of good 2 is low, so everyone jumps to good 2 the next day. Then, good 1 is low-price, so everyone jumps to good 1 on day 3, and so on. If only 1/n of the total population can buy a good, then I think that a market equilibrium might be possible.

Perhaps a bit more inertia, rather than less of it, is the solution. Like Artisans don't immediately switch to producing whatever goods that are immediately most profitable, POPs don't immediately switch their consumption patterns to the goods which give them the highest total utility, but rather, there's a set % chance that a POP re-calculates its consumption priorities every day. That'd save computing power too - if I remember my scientific computing classes correctly, sorting takes up surprisingly much computing power, but making a random roll takes up hardly anything.

 

[unmerged(2833)]

If I remember correctly, V:R moved liquor from subsistence to everyday goods to make it impossible to live off booze only.

Truly, the designers have no grasp of reality

 

[safferli]

If I remember correctly, V:R moved liquor from subsistence to everyday goods to make it impossible to live off booze only.

Whatever works!

Perhaps a bit more inertia, rather than less of it, is the solution. Like Artisans don't immediately switch to producing whatever goods that are immediately most profitable, POPs don't immediately switch their consumption patterns to the goods which give them the highest total utility, but rather, there's a set % chance that a POP re-calculates its consumption priorities every day. That'd save computing power too - if I remember my scientific computing classes correctly, sorting takes up surprisingly much computing power, but making a random roll takes up hardly anything.

Could also work, yes. I know next to nothing of coding, so your approach, while not being "true" in the economic sense, certainly can also be used!

 

[Sovereign]

I do feel that it is a game breaking way. There is simply too much money in the system in the late game.

Maybe there could be Corrections when that happens, isn't that what a crash is?

I find economics fascinating but really don't understand it, would be great if Vicky2 could teach me a thing or two.

 

[RedRalphWiggum]

Maybe there could be Corrections when that happens, isn't that what a crash is?

I find economics fascinating but really don't understand it, would be great if Vicky2 could teach me a thing or two.

Yeah, but I think he's saying its so bad it can't viably be fixed by gameplay.

 

[Sovereign]

Wow, we must be talking POPs pushing around wheel-barrows full of cash to buy bread.