The game's miscalculation of GDP and the side effects of it

[Seraphithan]

Expecting the ingame GDP to work the same way as the real world GDP ignores that the ingame economy doesn't work the same way as the real world economy. Market sell orders don't have to fully cover input buy orders for an industry to have maximum output. So if you don't count inputs that are consumed in domestic industries as part of the ingame GDP you will run into situations where significant expansion of your production of raw and intermediate products will have no impact on your GDP.

Example: All your steel consuming industry is fully staffed, but you lack a 1000 orders of steel (not enough to create a shortage in game mechanical terms). You build enough steel mills to cover this deficit, your GDP stagnates. You build coal and iron mines to cover the new buy orders of the steel mills, your GDP stagnates. You build chemical plants to cover the explosives demand of the new mines, your GDP stagnates.

Across this chain you have employed thousands of people but your GDP would not have grown. Worse, if you include the required inputs produced by the steel consuming industry, your GDP might have gone down.

 

[Majokarp]

Expecting the ingame GDP to work the same way as the real world GDP ignores that the ingame economy doesn't work the same way as the real world economy. Market sell orders don't have to fully cover input buy orders for an industry to have maximum output. So if you don't count inputs that are consumed in domestic industries as part of the ingame GDP you will run into situations where significant expansion of your production of raw and intermediate products will have no impact on your GDP.

Example: All your steel consuming industry is fully staffed, but you lack a 1000 orders of steel (not enough to create a shortage in game mechanical terms). You build enough steel mills to cover this deficit, your GDP stagnates. You build coal and iron mines to cover the new buy orders of the steel mills, your GDP stagnates. You build chemical plants to cover the explosives demand of the new mines, your GDP stagnates.

Across this chain you have employed thousands of people but your GDP would not have grown. Worse, if you include the required inputs produced by the steel consuming industry, your GDP might have gone down.

If the ingame GDP worked as the real world GDP in your example GDP would not stagnate as the newly employed pops would increase their consumption, thus increasing GDP.

 

[hermithill]

Once again, as far as I understand, it's computed at the level of the factory : Price is the local price (generally your market price, but it's modified when your state has a low market access), and Quantity is the output of the factory. Then it's summed up at the state level then at the nation level.

Production value of my tools factory is 11.0K (183*60.1).

Tools contribution to the "GDP" in Götaland state is 11.0K.
GDP of the state is 2.25 - total GDP is 8.53, so Götaland' contribution is 26.4% of the total.

 

[Seraphithan]

If the ingame GDP worked as the real world GDP in your example GDP would not stagnate as the newly employed pops would increase their consumption, thus increasing GDP.

Only if you produce what they consume, and if price and/or output actually increase.

 

[Broetchenholer]

So "Price" should be the market price after trade is considered, however I'm not very clear about quantities, are those sell orders (good produced + export) - import or only the good produced side of the sell orders?

This is so stupid. This means, your GDP can be in the billions and still your economy can literally die the next day. There are cases where your SOL is so high, that industries without certain automation levels are not productive anymore. So you could have the richest population of the world, with an industry that is producing enough goods to meet the complete demand of that population, and then this industry could die, because the expenditure for its workers is too high to make the goods profitable. And at the same time, this industry would give you a high GDP because, despite currently in the process of dying, it's still producing goods, so all is fine. and then, when it has spend all it's cash reserves, suddenly your gdp drops like a stone because the industry will now try to lose employees, which will raise the price of the good as less of the good is produced and therefore demand starts to exceed supply. Which means, in such cases we would see waves of GDP crashes, followed by SOL crashes. I think the GDP calculation is really not that important if you want realism compared to the glaring problems that can arise if you try to create a world where everyone pays the same for goods despite earning very different amounts of money.

 

[Eswahrt]

This is so stupid. This means, your GDP can be in the billions and still your economy can literally die the next day. There are cases where your SOL is so high, that industries without certain automation levels are not productive anymore. So you could have the richest population of the world, with an industry that is producing enough goods to meet the complete demand of that population, and then this industry could die, because the expenditure for its workers is too high to make the goods profitable. And at the same time, this industry would give you a high GDP because, despite currently in the process of dying, it's still producing goods, so all is fine. and then, when it has spend all it's cash reserves, suddenly your gdp drops like a stone because the industry will now try to lose employees, which will raise the price of the good as less of the good is produced and therefore demand starts to exceed supply. Which means, in such cases we would see waves of GDP crashes, followed by SOL crashes. I think the GDP calculation is really not that important if you want realism compared to the glaring problems that can arise if you try to create a world where everyone pays the same for goods despite earning very different amounts of money.

What's so stupid here? Do you think dated production methods from your example should remain profitable no matter what?

 

[GrafKeks]

The analysis is formally correct, but based on thinking about actual goods. As has been discussed many times, there are no goods as such in this game just (typically unbalanced) buy and sell orders.

This makes no difference whatsoever, Vic2 doesn't have actual goods either. It's about the market-price of the goods.

So a realistic calculation of GDP seems impossible even in principle.

For GDP calc, substract the input price from the output price (and it's a lot more in line with GDP), that's just a huge vector, hence GPU work.

The name "GDP" should probably just be considered an immersion-enhancing label for an abstract game score used to calculate other game quantities. It incorporates aspects of GDP as well as the velocity of money.

As GDP is per definition final goods only, it doesn't incorporate it, it violates the definition. Whether that's immersion-enhancing is in the eye of the beholder. (Unless you argue GDP is a set of he monetary value of all final goods in which case yes real GDP is a true subset of in-game GDP lol).

I mean, if you're purely concerned with making funni number go up, or inflating the free minting money, then yes. Increasing actual added value would have other effects on the rest of the economy, like paying out wages and/or dividends. Thus, the government could see some extra income if those things are taxed, or more indirectly for consumption taxes.

But it is added value, minting creates cash, industry creates jobs and dividends. Being concerned with maximizing construction is over the long-term the highest value added, by far.

 

[Froonk]

This is a major flaw with the game and needs to be fixed. It singlehandedly multiplies all raw resources by length of supply chain and who knows how many effects that produces downstream for both country and global economy.

 

[GrafKeks]

Expecting the ingame GDP to work the same way as the real world GDP ignores that the ingame economy doesn't work the same way as the real world economy. Market sell orders don't have to fully cover input buy orders for an industry to have maximum output.

Overproduction doesn't happen? I am not sure what the point is, equilibrium isn't reached in reality either, but yes the lack of profit calculus is quite sad.

So if you don't count inputs that are consumed in domestic industries as part of the ingame GDP you will run into situations where significant expansion of your production of raw and intermediate products will have no impact on your GDP.

That depends on the market-price and whether you trade or not. Although yes the impact should be allowed to be negative, but that requires a mod that changes the price range.

Example: All your steel consuming industry is fully staffed, but you lack a 1000 orders of steel (not enough to create a shortage in game mechanical terms). You build enough steel mills to cover this deficit, your GDP stagnates. You build coal and iron mines to cover the new buy orders of the steel mills, your GDP stagnates. You build chemical plants to cover the explosives demand of the new mines, your GDP stagnates.

Across this chain you have employed thousands of people but your GDP would not have grown. Worse, if you include the required inputs produced by the steel consuming industry, your GDP might have gone down.

Mis-allocation should definitely be in the game. This also requires a specific current market-price, if output value/input value < 1 then it should be negative if it's equal one it shouldn't change sounds right.

 

[Evethor]

I shudder at the thougt of what this would do to performance.

 

[Broetchenholer]

No, i think SOL should have an impact on the price of goods in the market. Imagine if in the real world everyone would pay the same amout for bread. In this game, in 1880, the pop of a player led US with a SOL of 25 and wages corresponding to that pays the exact same for grain as the ai led Sokoto pop with SOL 11. If it would increase the base price of those goods based on the wealth of the market, you would get real globalized industries because because at some point, the high SOL of your country would mean that you have to import some especially work intensive goods from someone else. If you do not have this, there are simply arbitrary set lines at which a specific industry without an upgrade gets unprofitable. In the real world, a farming industry would switch to the production method that would give them the highest profit but they would also increase their prize until they are profitable if they knew that their customers could and will afford to pay it.

 

[GrafKeks]

I shudder at the thougt of what this would do to performance.

You mean if PI were to use the GPU for vector calc where it's applicable? Far less lag and a far faster game would be two results.

 

[0watcherinthewater0]

As far as I understand it, the issue with calculating GDP realistically is determining what’s a “finished product”.

Then why not just calculate it as the sum of all pop spending on needs + investment pool transfers + government income from taxes?

 

[PedroLuiz]

You could even export 60 liquor while only producing 30.

you can't, you can only export 100% of your production
you could export 30 and consume 30 tho

 

[Eswahrt]

What's the issue? And why so much obsession with input goods substraction? Just add together all the wages and dividends and substract subsidies. There is no issue.

The thing is that it will really just change the number on screen, Minting and max credit as % of GDP should be adjusted to remain balanced (increased so that absolute numbers remain where they are now).

 

[Amtep]

you can't, you can only export 100% of your production
you could export 30 and consume 30 tho

What if several other countries set up trade routes from your market? I'm under the impression that 6 countries could still import 10 each from you.

 

[PedroLuiz]

What if several other countries set up trade routes from your market? I'm under the impression that 6 countries could still import 10 each from you.

they will compete for the 30 you produce and the ones with more TR competitiveness will get more

 

[Seraphithan]

Overproduction doesn't happen? I am not sure what the point is, equilibrium isn't reached in reality either, but yes the lack of profit calculus is quite sad.

I'm not sure what you are asking here. This isn't about overproduction or an equilibrium. It is about how Vicky 3 summoning potentially enormous amounts of input goods into existence to supply profitable industries interacts with the proposed change to calculating the GDP when you reduce that magical amount.

That depends on the market-price and whether you trade or not. Although yes the impact should be allowed to be negative, but that requires a mod that changes the price range.

Mis-allocation should definitely be in the game. This also requires a specific current market-price, if output value/input value < 1 then it should be negative if it's equal one it shouldn't change sounds right.

In a game the economy size indicator should not shrink or stagnate when the player makes positive contributions to the economy. Reducing a deficit is a positive contribution. Vicky's model fudging some numbers to not melt cpus and brains shouldn't punish the player.

 

[GrafKeks]

I'm not sure what you are asking here. This isn't about overproduction or an equilibrium. It is about how Vicky 3 summoning potentially enormous amounts of input goods into existence to supply profitable industries interacts with the proposed change to calculating the GDP when you reduce that magical amount.

That answers my question though. You mean the interaction with the open-market.

Is negative supply's market-valie added to GDP, if not there's a good likelihood you'd get GDP added if you reduce the lack of supply, as the lack indicates that the value is above market-price. Although the negative supply is at least indirectly added due to allowing for using it as an input. Negative supply might be quite beneficial in the current system then. Haven't viewed it that way, although it really shouldn't be.

In a game the economy size indicator should not shrink or stagnate when the player makes positive contributions to the economy.

I do absolutely agree here, but positive is highly contextual and dependent on a ton of variables.

Reducing a deficit is a positive contribution. Vicky's model fudging some numbers to not melt cpus and brains shouldn't punish the player.

Whether reducing a deficit is good or bad as a choice is absolutely dependent on the environment and alternative choices, if it's always good that hints towards a very constrained and undynamic design. Although it isn't in the current build anyway, just most of the time, unless one reached a shortage then it becomes critical quickly. But a shortage is different from a deficit and then again it depends on environment and alternatives as well.

I do agree that what can be done as a simple vector operation doesn't belong on a cpu(usually with a big it depends), I don't think players get confused by substraction though.

Is over-inudstrializatiom an MP-Meta already? Given how much more you can mint it likely should be.

 

[MathyM]

In a game the economy size indicator should not shrink or stagnate when the player makes positive contributions to the economy. Reducing a deficit is a positive contribution. Vicky's model fudging some numbers to not melt cpus and brains shouldn't punish the player.

This would be true if your GDP was the only indicator of economic health. Some positive decisions you make will impact SoL, state budget, state income, investment pool, etc.. And some positive decisions you make will increase your GDP. It’s not all about making that single line go up.