Production - what is it?

[Floatserve]

One of the things I never quite understood is what base production actually refers to in the real world. I hope one of the more well read members in history can explain it to me. Base manpower is fairly obvious the number of capable and draftable warm bodies, while base tax could mean anything from population to capitation taxes to "everything taxable". So where does this leave base production?
Past suggestions have mostly tried to describe it as all kinds of urban commercial activities and the actual development of a province. This makes sense to me until production efficiency enters the picture: What kind of income is that compared to taxes and trade? Obviously not every manufactory is state run and the valueables provinces produce already end up in trade (which the game already categorizes as domestic and foreign). So is production income a kind of tax on commercial activities? Does it -from a historical perspective- make sense to seperate this from trade income?

Edit in advance: I know tax, production and manpower have been added to fit the three mana category system and the game overall. This it not what I'm asking for, I'm hoping for a real world explanation to make sense out of it.

 

[Soulburger]

I have always abstracted that production is the direct profit of the province's trade good. That good is later resold outside of the local market which accounts for the trade income.

So local farmer sells excess grain at local market level = production income
Then merchant resells same good in a secondary market = trade income

 

[ctg7w6]

I've just looked at it as the production of goods. In this game, that would be the good that is produced in that province. Reductionist compared to the real world, but it's a game. I am unsure, however, how production feeds into trade, because one must assume that what is produced is what is traded for a profit... So, not sure about the implication for the game design, but that would be one use of production in real life. The other would be domestic consumption, which I am guessing what is actually modeled by the game for simplification purposes, but I could be totally wrong on this. Ideally, the good produced in the province would have an effect on trade, taxation, etc...

 

[Floatserve]

Then merchant resells same good in a secondary market = trade income

So trade efficiency would be taxes on trade of private people and(/or if that is already covered as tax income) income from state sponsored enterprises.

So local farmer sells excess grain at local market level = production income

This would be what I meant with "commercial activities". However, if tax income is thought to cover this, what would be left for production income to represent?

 

[Gratak]

So trade efficiency would be taxes on trade of private people and(/or if that is already covered as tax income) income from state sponsored enterprises.

This would be what I meant with "commercial activities". However, if tax income is thought to cover this, what would be left for production income to represent?

One could maybe see "production" as the tax on the actual selling of the goods, while "taxes" are paid by each worker.

 

[Me_]

Nothing. It's an abstract concept. Flavour events suggest it's main trade good that is produced in the area. How it generates income is unknown.

 

[RedBstrd]

One of the close real world parallels for base production would be cottage industry. It's an abstraction in the game, but you can imagine increasing base production as something akin to sponsoring the development of (or giving contracts for) textiles produced in the home (Great Britain, Flanders, India) or household production of rugs (Persia). In agriculture, you can picture base production as the planting of cash crops.

 

[Beagá]

Corruption should make production less profitable, specially of gold. As it is it´s a concept that is not even used

 

[Floatserve]

One of the close real world parallels for base production would be cottage industry. It's an abstraction in the game, but you can imagine increasing base production as something akin to sponsoring the development of (or giving contracts for) textiles produced in the home (Great Britain, Flanders, India) or household production of rugs (Persia). In agriculture, you can picture base production as the planting of cash crops.

I see. But how would the government make money from this? It's clear in cases where the government sells licenses to do business, but what's with people knitting at home and then selling it privately? Maybe this is too obvious, but did a proportional commerce tax exist othern than on trade during this time?

These questions may all seem stupid, yet, the reason I'm asking is that I'm working on an ancient era mod at the moment and the more I investigate production the more I find I should cut it and go with trade and taxes only.

 

[RedBstrd]

I see. But how would the government make money from this? It's clear in cases where the government sells licenses to do business, but what's with people knitting at home and then selling it privately? Maybe this is too obvious, but did a proportional commerce tax exist othern than on trade during this time?

These questions may all seem stupid, yet, the reason I'm asking is that I'm working on an ancient era mod at the moment and the more I investigate production the more I find I should cut it and go with trade and taxes only.

I'm trained as a cultural historian rather than an economic historian, so please don't take my answer as being anywhere near 100% confident. That said, my sense is that by the end of EU4's time frame, despite income taxes being atypical during this period pretty much anywhere in the world except in rare cases of war, most nations would have some taxes attached to production - either directly or indirectly. In Europe by the 18th century, things like textiles/wool and agricultural products brought to local markets or sent abroad would have a tax or tariff attached. A growing capitalist class would be sponsoring factories (in cities) and cottage industry (in rural areas) to produce things that would both reach market and be taxable or require some sort of revenue-generating license from states. The same would be true in regard to the Persian rug cottage industry, silk production in Japanese factories, and so on. EU4's base production isn't a bad representation for late game local proto-industrial production output.

In the 15th century, though, the answer would probably be more dependent on the specifics of the time or place. In Europe at least, many cities would have guilds dominating what EU4 represents as base production. These guilds would likely pay something to the crown directly, or failing that, have to contribute financially indirectly for their city or town's charter. Outside of select European cities, though, it's hard to know exactly how much and by what means the state reaped returns on local production of wide ranges of goods. Much of cottage industry, for example, was seasonal, dominated by women, and circulated in local economies... meaning that pre-modern states probably had a lot of trouble trying to track, tax, and profit financially from it. EU4's base production is probably not the best representation for how medieval local production provided the state with money... but production efficiency is tied to tech level, so the inefficiency in medieval states profiting from this kind of economic life actually has some logic already applied to its mechanics in game.

I guess that the big issues are: (1) how you wish to figure out what goes into the trade income formula in your mod, and (2) do you want your mod to represent the economics of the late game period (and West/Central European city economies) well or instead focus on mechanics that represent the other time periods and places? For an ancient era mod, production income is probably less critical, but even Rome had guilds that should play some role in the economics of the game.

As a side note, cottage industries should have some place in EU4, even if they aren't a direct input for income. Much of their function was to supplement household incomes outside of agricultural harvest times (furriers, carpenters, etc.) or to generate income for women (as seamstresses, brewers, etc.). Rural populations in more economically advantageous local production systems would be less likely to be driven to starvation/revolt and would be less eager to move to cities in search of work in agricultural down seasons (so it realistically would contribute to lower revolt risk or cheaper stability), plus would be able to supply the needs of friendly armies more easily (tied to supply limit and/or reinforce speed). Likewise, looting by foreign armies would benefit more in places with more local production. Having base production as fuel for the loot bar might by itself justify keeping the mechanics in the game, but your mileage may vary. Guilds should also play some part, so removing production income would require some mechanic for guilds.

Hope that helps. I'm sure that a lot of people know more about medieval economic life than me, so hopefully one of them can give a better answer.

 

[Floatserve]

I'm trained as a cultural historian rather than an economic historian, so please don't take my answer as being anywhere near 100% confident. That said, my sense is that by the end of EU4's time frame, despite income taxes being atypical during this period pretty much anywhere in the world except in rare cases of war, most nations would have some taxes attached to production - either directly or indirectly. In Europe by the 18th century, things like textiles/wool and agricultural products brought to local markets or sent abroad would have a tax or tariff attached. A growing capitalist class would be sponsoring factories (in cities) and cottage industry (in rural areas) to produce things that would both reach market and be taxable or require some sort of revenue-generating license from states. The same would be true in regard to the Persian rug cottage industry, silk production in Japanese factories, and so on. EU4's base production isn't a bad representation for late game local proto-industrial production output.

In the 15th century, though, the answer would probably be more dependent on the specifics of the time or place. In Europe at least, many cities would have guilds dominating what EU4 represents as base production. These guilds would likely pay something to the crown directly, or failing that, have to contribute financially indirectly for their city or town's charter. Outside of select European cities, though, it's hard to know exactly how much and by what means the state reaped returns on local production of wide ranges of goods. Much of cottage industry, for example, was seasonal, dominated by women, and circulated in local economies... meaning that pre-modern states probably had a lot of trouble trying to track, tax, and profit financially from it. EU4's base production is probably not the best representation for how medieval local production provided the state with money... but production efficiency is tied to tech level, so the inefficiency in medieval states profiting from this kind of economic life actually has some logic already applied to its mechanics in game.

I guess that the big issues are: (1) how you wish to figure out what goes into the trade income formula in your mod, and (2) do you want your mod to represent the economics of the late game period (and West/Central European city economies) well or instead focus on mechanics that represent the other time periods and places? For an ancient era mod, production income is probably less critical, but even Rome had guilds that should play some role in the economics of the game.

As a side note, cottage industries should have some place in EU4, even if they aren't a direct input for income. Much of their function was to supplement household incomes outside of agricultural harvest times (furriers, carpenters, etc.) or to generate income for women (as seamstresses, brewers, etc.). Rural populations in more economically advantageous local production systems would be less likely to be driven to starvation/revolt and would be less eager to move to cities in search of work in agricultural down seasons (so it realistically would contribute to lower revolt risk or cheaper stability), plus would be able to supply the needs of friendly armies more easily (tied to supply limit and/or reinforce speed). Likewise, looting by foreign armies would benefit more in places with more local production. Having base production as fuel for the loot bar might by itself justify keeping the mechanics in the game, but your mileage may vary. Guilds should also play some part, so removing production income would require some mechanic for guilds.

Hope that helps. I'm sure that a lot of people know more about medieval economic life than me, so hopefully one of them can give a better answer.

Thank you, this is already a great answer. It helps understanding what the proportion of tax income vs production income should be like. A few mysteries still remain (like production income on ivory or fish), but I'm fine with saying 'this is just the way the game is' in those cases.

 

[uberjedi]

I just imagine that when people create more and more stuff than before, they sell it and earn more and more money. This money sooner or later ends up in the coffers of the government through various taxes.