Trade companies and shareholders

[AnguyTheArcher]

1. Now I don't know how will the trade companies work, but I suspect they will be way too similar to colonial nations, which means basically a sovereign nation with one overlord - you. I believe it would be much more interesting if there were more factions in play - shareholders that could have different priorities than you. So it would work like this - after reaching certain tech level you'd be able to create trade company which means some monarch points and some money to raise capital. Newly created trade company (players would be able to play as them) would have the treasury equal to starting capital and that money can be used to buy soldiers, ships, advisors etc.

2. But now it gets interesting. There should be a possibility to allow other entities to invest into trade company. The benefits would be obvious - larger starting capital means much better stating position. But there would be drawbacks - you (the king) would only control your share of company. Let's say you invest 200 and other investors invest 800, that means you are left with just 20%. The shareholders could vote every 5-10 years, whether they want the dividends or they leave money in the company to assist with its expansion. There might be other decisions that require shareholders approval like declaration of war. That might lead to interesting situation when other shareholders vote for something you don't want - for example conquest of Viijangar, while you want to take Ceylon.

3. Second point brings us to important question - who should this other investors be? In case we want to keep it historical it should be private individuals from your country. But the game doesn't simulate private wealth of population at all, so in order to do so the economy system would have to be changed.
Other possibility is somewhat ahistorical but I think it would result in very interesting gameplay - other countries. Those other countries would invest at the beginning and they would be able to buy shares from other investors afterwards (you'd be able to do the same of course). The biggest investor (including his vassals and PU countries) would automatically become company ally. That means a rich country could be able to steal the allegiance of company from you by having more shares than you do. The transfer of shares can also be included in peace terms (like give me 10% of East India Company for 10% warscore) And in case some country buys 100% of shares it would be able to integrate the company and all its holdings.

So what do you think?

 

[frolix42]

I think you are describing a different game. It's not necessarily a bad game, but it's not what EU4 is.

1. Having a trade company player controlled and forming it's own (independent) country would be odd. Didn't happen in history and I really don't think that there was every the seeds of a movement in the East India Company (or any other trade company) to break free from their homeland.

2. What other entities would invest in the trade company? You seem to be describing some kind of POP system like in Vicky2. It would mean creating a whole new game mechanic to simulate private investors, their funds and interests, shares and their values, all of this which seems overcomplicated a waste of developer's resources. Right now colonial subjects already do things that overlord nations don't want. Why create shareholders and voting to simulate this?

3. This was the Age of Mercantilism and, for example, the King of Portugal was simply not allowed to buy the allegiance of the British Trade Companies. Having countries investing in another countries Trade Company hoping for a hostile takeover isn't how trade countries competed. It's not really until the 20th century, and the advent of global finance, that this could begin to be possible.

Rehauling the entire economy system for something as minor as how trade companies behave is an inefficient use of resources. Victoria 2's economic system is very intriguing but it is much more complicated than EU4's and honestly it had serious flaws which caused the markets to behave bizarrely. Please play Victoria 2 and if you think that Paradox has a complete handle on how POPs handle their wealth, I'll argue with you about why this isn't so.

God bless Paradox for making Victoria 2. I will buy Victoria 3 and know it will have a better economic system. It's just not prefect yet.

 

[AnguyTheArcher]

I don't think having private capital would be that difficult to implement. No need to go with something so complicated as POP in Vicky. Just separate state treasury and private wealth.Simply multiply base tax and production by 5. Add 2 economy sliders - taxation and tariffs. If you increase them it would mean increased revolt risk, more money to your treasury and but less to general population. Rebellions and wars would decrease population wealth too. Population with more capital would be able to build for example manufacturies or invest into trade companies. So you need to change just few things. That's not so complicated as in Victoria.

2. I never proposed trade companies to*become independent, just that someone might be able to take the control from you. And I realize that's not very historical, given national character of EU companies, but no one would force you to open your company to foreigners. You can keep it 100 yours, but the company would have worse starting financial position compared to open one, because of less capital. Open companies would also allow other nations to profit from lucrative trade, not just colonial nations.

 

[frolix42]

I don't think having private capital would be that difficult to implement. No need to go with something so complicated as POP in Vicky. Just separate state treasury and private wealth.Simply multiply base tax and production by 5. Add 2 economy sliders - taxation and tariffs. If you increase them it would mean increased revolt risk, more money to your treasury and but less to general population. Rebellions and wars would decrease population wealth too. Population with more capital would be able to build for example manufacturies or invest into trade companies. So you need to change just few things. That's not so complicated as in Victoria.

It's very similar to how the Capitalist POP works in Victoria 2. I'm not convinced that it could be implemented with more success in EU4, or even that it should. Adding another layer of complexity would violate Occam's Razor of development. The developers should focus on making money useful in the late game, before adding a taxation and investment mechanic.

2. I never proposed trade companies to*become independent, just that someone might be able to take the control from you. And I realize that's not very historical, given national character of EU companies, but no one would force you to open your company to foreigners. You can keep it 100 yours, but the company would have worse starting financial position compared to open one, because of less capital. Open companies would also allow other nations to profit from lucrative trade, not just colonial nations.

If you're suggesting that a player would be able to switch to play as a trade company, it implies that trade companies could become independent. If you're not, players will still want the ability to become independent if they can play as a trade company so it's not a path that I would want to go down.
Large scale foreign investment in national trade companies isn't something that happened or is plausible in this game's time frame. The reason for trade companies to exist in the first place was to monopolize wealth in areas where a European nation had influence.