Rework inflation to solve late-game Scrooge-McDuckyism

[Me_]

We all know the problem - in the late game money is worthless. This problem has plagued the EU since time immemorial. To fix or at least mitigate it I suggest we look at a certain game mechanics, that could be used in a much more practical way, namely inflation.

To explain how to use inflation to solve the Smaug problem, let us look at another grand strategy game - Civilization.

In the Civilization games there is a variable in the expenses tab that is called inflation. What it does is simply increase over time. In other words your expenses always increase over time. The unavoidability is the important aspect here. You are always running against the clock.

Another aspect of Civilization games is the fact that unit upkeep cost increases with their number. This solution does not have practical applications in EU4, as it would cause players too much frustration, but it's worth noting that unit upkeep is not static. We will see how this can (and actually already is - more on that later) be applied in EU4.

Back to inflation, our main subject here. I will not bother explaining all the many ways in which inflation as presented in EU4 has nothing to do with the real-world concept of inflation, as real-world arguments are not really useful in abstract representations of various concept in games. What I will focus on is the fact that inflation is a thoroughly useless feature.

What inflation does is punish the player for taking loans or over relaying on gold mines. Both are things that the player shouldn't really be punished for.
First loans - the player is already being punished for taking loans by being forced to pay interest. Punishing him twice serves no purpose beyond causing frustration.
Over relying on gold mines is more of a problem, but it would make much more sense to balance them by decreasing the amount of money they actually generate. As it is the game actively encourages the player to farm gold mining nations, that it either establish vassals on gold provinces and then take money from them via vassal fees or attack gold mining nations for money, although the second method also generates inflation.

Inflation from loans really needs to go. Inflation from goldmines can stay, although it feels arbitrary.

Back to the point. I believe that inflation overall should be used in service of the game's economy, instead of being an abstract representation of a problem that rulers of the era experienced, but did not know how to combat (what is spending paper mana to decrease inflation supposed to represent, anyway? bringing economists from the future via time-travel?).

I propose that inflation should work in the following manner:

There should be no action to decrease inflation.

It should not be possible to have monthly inflation in the negatives. In other words:

There should be no way to decrease inflation.

Where would inflation come from? There should be a base increase of inflation of 0.1 per year.

Inflation should be unavoidable. Inflation should be an elephant that is always charging at you. Inflation should be something that can only, at best be halted, never reversed.

OK, so that's one money sink - inflation. On to the other one.

Have you ever though about how fleets become more expensive over time but armies do not? It's particularly baffling, because armies are the biggest money sink. This is a war game. War is 75% of what you do, with the remaining 25% being making sure that your wars are won before they even begin. And yet, armies can only become cheaper over time. Why? Since your income more-or-less always go up over time, why does army upkeep only go down (or stay in place)?

Army upkeep should increase over time, just like naval upkeep does. This would be a money sink that would be the most obvious one to think up and yet it's still missing. It's time to remedy this situation.

Oh, and one last thing: being at 100% maintenance could give a small tickling army/navy tradition to motivate players to spend even more.

 

[ozyhuboi]

While I agree with you on the point of army maintenance increasing with tech, as cost of regiments should be as well, I find your approach to inflation a little strange.

First, let's talk about what inflation actually is: an increase in the supply of a currency vs. how much it is actually used. This is reflected in prices where the listed price (nominal value) of something rises. In the short run, this can be a problem for many purchasers because they have difficulty buying things now because they don't have enough money, since wages are sticky and change slowly. In the long run, if inflation is steady and predictable wages will adjust accordingly so it is not a problem, and in fact a good thing (or at least taught so in pretty much every economic school) because it reduces the real value of loans (because the listed value or nominal value of the loan stays the same), like in Japan and Korea. If inflation is not steady and predictable we get Weimar Germany and Zimbabwe.

So what does that mean for EU4 historically? Well first it's likely that inflation and gold mine bit is to show how when the Spanish Empire starting exploiting the New World for gold, they were suddenly hit with massive inflation and went bankrupt several times. Well this is because back then, all currency was specie as in it required bullion (gold and silver) to be worth anything and actually prior to the discovery of the New World, Europe was actually facing a massive bullion shortage and rulers were having difficulty minting their own currencies, leading to massive deflation as there literally wasn't enough money to go around. But now Spain actually had enough bullion to make coins and since they got greedy, they made way too much (think King Midas) and screwed themselves over as producers jacked up their prices in response, plus a bunch of costly religious wars that made most of this wealth get spread over Europe (freakin Philip II). So from a gameplay standpoint, it would be logical that the rate of inflation one takes from gold mines would be tied to the ratio of gold income vs. actual income, though the exact value of 0.5 seems rather arbitrary.

Gameplay wise, first, I want to say that player options, ideas, and policies that can reduce inflation are necessary. Any assertions otherwise are absurd as it implies the only other options for the reduction of inflation would be events or game over. Historically, rulers have taken many possible methods to reduce inflation, from fixing prices to enforcing a gold standard. In response however, there should be a healthy, positive value (say 1% to 5%) that inflation sits at or softly falls back to, like with prestige, and having inflation much higher (up to 50%) or lower (down to -20%) of that value could be a bad thing. Of course, this make this meaningful, two other major aspects would need to be implemented. First, loans are made more important and practical. Maybe at the beginning of the game during the era of feudal lords, loans and usury of any sort was condemned, however by the Napoleonic era loans were normal and commonplace actions by states to supplement budget shortfalls. This should be illustrated in changing administrative tech tech to reflect this where by some high ADM tech, say 22, there is a latent inflation reduction value. Also, "loans" could mean two different things. It could either mean the nation literally borrows money which shouldn't increase inflation. Or it could mean an expansionary monetary policy (mints new money, essentially "borrowing" from the future that it would have to pay for things now) which would increase inflation. Now the benefit of the former is obvious as inflation wouldn't increase. However the benefit of the latter would mean that it would be easier to pay off that loan. One of the things I found odd was that the amount you need to pay off for a loan is adjust for inflation, which is completely wrong because that goes against the whole idea of loans which is that they're worth less in the future. In that sense only the first type should be available at the beginning of the game but once ADM tech reaches a certain level, say 20-something, the second should be available as well so loans would be more practical by then. Second, inflation in the game is actually calculated every year, not every month. Early game, inflation shouldn't play a big part in the economy as there was very little understanding of it at the time, the main issue then being interest from loans. So early game inflation would be close to 0, as the whole feudal economy revolved around service and duties rather than specie in Europe at the time (to explain the historical economic value of inflation in China and India would probably take nothing short of a masters thesis to explain so I will refrain from doing so here). As such, as inflation starts to increase from the discovery of the New World an important phenomenon should occur as well:

The price of units (ships and soldiers), buildings, advisers, etc increases yearly by that yearly inflation rate.

This is different from the current system where most things have a small increase in value by that inflation rate during the year, say a building that costs 100 ducats would cost 103 now that inflation is at 3%.

What I am proposing now is that the entire base value would be changed to 103 at the end of the year, and if the inflation rate stayed at 3% at the end of the year, the price would now be 106.9, and so on. So after about 400 years of inflation this would prices could increase by 400% (5x) if inflation was kept at an average of 1% over that time period. Now this sounds absolutely ridiculous in the short term but relating to the discussion of real-world inflation above, so long as the country properly manages income by the end game, this 400% increase in real value would be quite a bit less, maybe only 100% (2x) in real if you are really good. This could combat those money heaps in that the player would literally need to spend more in nominal value by end game

One last historical note, it should be kept in mind that massive explosion of economies from 1444-1821, especially through the Agricultural and Industrial revolutions. So in that sense it would be quite reasonable that states have more money to spend by the end as economies had expanded so much in that time.

 

[Danfish77]

I still don't understand the claim that "money is worthless" in-game. Buildings, advisors, bribes, ships, mercenaries, soldiers... if you have heaps of extra money, buy something! Fight a war!

 

[Mattius]

I still don't understand the claim that "money is worthless" in-game. Buildings, advisors, bribes, ships, mercenaries, soldiers... if you have heaps of extra money, buy something! Fight a war!

I know, right?

 

[Me_]

The value that the game calls inflation isn't even the real value of inflation in the game, nor is it posted as a value that comes anywhere close to actually being inflation, as it displays a variation from a “base” prices that are mostly constant or decreasing across the game which is about as real-wordy as giant floating crowns over capital cities.

There is more inflation in the game than this pseudo-inflation.
Consider what you call the increase in advisor cost over time. Why - it's inflation!
Increase in naval upkeep over time (Really over tech, but it's close enough). Inflation!
Hypothetical and often proposed (including by me) increase over time (tech) in army upkeep. Yup, it's inflation!

Obviously inflation could also be hidden in other places. Perhaps building cost couyld increase with tech. That would be another good type of inflation to include, while leaving the players with the pseudo-inflation to play around with.

Or we could just go with bundling all inflation together under the pseudo-inflation we have now, and just make it clear that its unavoidable.

Gameplay wise, first, I want to say that player options, ideas, and policies that can reduce inflation are necessary. Any assertions otherwise are absurd as it implies the only other options for the reduction of inflation would be events or game over.

Gameplay wise, first, I want to say that player options, ideas, and policies that can reduce inflation are necessary. Any assertions otherwise are absurd as it implies the only other options for the reduction of inflation would be events or game over.

The price of units (ships and soldiers), buildings, advisers, etc increases yearly by that yearly inflation rate.

This is different from the current system where most things have a small increase in value by that inflation rate during the year, say a building that costs 100 ducats would cost 103 now that inflation is at 3%.

What I am proposing now is that the entire base value would be changed to 103 at the end of the year, and if the inflation rate stayed at 3% at the end of the year, the price would now be 106.9, and so on. So after about 400 years of inflation this would prices could increase by 400% (5x) if inflation was kept at an average of 1% over that time period. Now this sounds absolutely ridiculous in the short term but relating to the discussion of real-world inflation above, so long as the country properly manages income by the end game, this 400% increase in real value would be quite a bit less, maybe only 100% (2x) in real if you are really good. This could combat those money heaps in that the player would literally need to spend more in nominal value by end game

I find it funny that first you say that unavoidable inflation is ridiculous and then you propose unavoidable inflation.

In the end I see that you do agree with me, but I think it's time top make one thing clear: the value that the game calls "inflation" is not in any way actual inflation. It's therefore important to avoid equivocation - using one word to describe two different things. Your post very nicelyy describes real-world inflation, but sadly has little conection to what the game calls inflation. This is the result of the fact that the game does not have an economy and operates on standard videogame concept of fixed base prices. I do think that hiding real inflation by introducing a fixed increase in base prices is an acceptable alternative, I just think that it makes things more messy as real inflation becomes a function of what game calls inflation, increase in advisor cost over time, increase in naval upkeep cost over tech and an increase in base prices over time.

Inflation hidden behind base price increases is perhaps an even better solution than my proposal (even though it's practically identical), because it gives the player the ilusion of control (as they can continue to play around with the pseudo-inflation) while really all the players do is adjust to circumstances they cannot control, which is what leading a country should really be about.

 

[grommile]

Inflation should be unavoidable. Inflation should be an elephant that is always charging at you. Inflation should be something that can only, at best be halted, never reversed.

Nonsense. Real economies experienced real deflation in the period.

It was not a pleasant experience.

 

[Me_]

Nonsense. Real economies experienced real deflation in the period.

It was not a pleasant experience.

Except that what the game calls inflation has no relation to real-world inflation. Let's not equivocate.

I say that this silly concept that the game calls inflation and serves only gameplay purposes with no relation to real-world issues should follow rules required by a game system and not ones that real-life inflation (again, no relation to what the game calls inflation) experienced.

So you are totally right and I wholeheartedly agree, it's just irrelevant.

It would really be easier if people stopped confusing in-game concept and real-world issues. Morale may be a combination of psychological factors, supplies, training, etc. But what is morale in-game? It that bar that goes down as you fight. That's all there is to it and trying to argue that experienced troops should have better morale serves no purpose.

If we want to get technical what do you call the phenomena of money becoming so abundant late-game? Why it should be called deflation as real cost (although not nominal cost) of everything drops to almost zero. Except that the game saves you all those nasty side effects of your economy collapsing in on itself as a result as grommile pointed out.

I still don't understand the claim that "money is worthless" in-game. Buildings, advisors, bribes, ships, mercenaries, soldiers... if you have heaps of extra money, buy something! Fight a war!

That's not enough, though. Past around 1700 the speed at which your income increases grossly outpaces any possible spending. The player makes so much there's no time to spend it all.

 

[Danfish77]

That's not enough, though. Past around 1700 the speed at which your income increases grossly outpaces any possible spending. The player makes so much there's no time to spend it all.

Have you tried having 8 colonies at once? Tried having armies and ships triple your force limits? Bribing every country on the planet? Building to maximum in all provinces? Unless you've conquered all of Asia I don't believe you; I think you're just not creative enough.