[Roundtable] The Aelyrian Economy

[Kaelon]

This thread is a roundtable to brainstorm and share ideas.

Aelyria is a place of high opportunities and tremendous challenges, and for many this means facing the risks of the marketplace and seizing the rewards of wealth. However, Aelyria's economic system -- while extremely advanced and intricate -- is not particularly sophisticated or realistic, because different moderators use separate standards and ideas about the value of goods and services. For example, few moderators may know that the richest player characters in Aelyria's history have only traditionally ever had several million Crowns, but some moderators are routinely pricing out businesses that can make their owners richer than the entirety of the Aelyrian Treasury.

I think it makes sense to have a discussion about this and share ideas on how to:

• Standardize Aelyrian Economics
• Create and Enforce Systems of Economic Risk and Reward
• Simulate a Sophisticated, Realistic Economy

I'll start with some ideas, and ask you for yours.


Standardization

Goods and services need to have fixed, default prices. I'm not saying priced out mandates that need to be duplicated across cities, but certainly at least basic tables, or price lists, that set into expectations a specific "base" or "default" cost or value for certain things. This will help ensure that monetary rewards are appropriate for characters at different risk/reward levels, while also making certain that expenses and revenues are calculated properly when users try and maintain financial ledgers on their charactersheets. Aelyria has attempted these Price Lists in the past, so the foundation is already there. We just need to iterate upon them and make a single, comprehensive resource for both players and moderators. I estimate the process could be complete in under a week, and I would be delighted to personally drive it to completion.


Systems

Using a Price List, we can then build general, simple rules and expectations around what players should expect to spend and what they might expect to earn (if they own sources of income). Creating systems like this needs to factor in basic economic ideas -- corruption and waste being chief among them -- while at the same time setting financial limits on what different areas of Aelyria can reasonably sustain. For example, a small, quaint village in the forest cannot, overnight, become the center of a thriving global commercial trade. And, furthermore, many of Aelyria's locations are designed, specifically, to be rural villages, small shires, and tranquil hamlets. I suspect the building of real Risks and Rewards around economics will face considerable controversy, especially for designers of locations who have come to expect or anticipate a certain wealth/income level, only to realize that their expectations may be different from the economic realities. But holding location designers accountable to the same economic rules that players abide by is critical to creating a realistic, enjoyable, and balanced system of financial risk and reward.


Simulation

Once a comprehensive Price List is established, and systems and rules are put in place (a process which could take several weeks to complete), the final step, as I see it, would be to set the economic machine in motion by simulating it. Each city (indeed, each section of each city) can be assigned modifiers, or values that adjust the default/base values set in the Price List across several categories (e.g., Agricultural Goods, Luxury Goods, Real Estate, etc.), customizing those values for the unique socioeconomic conditions that impact that location. By making this simple step of setting modifiers for each location, players will begin to form trade routes -- where they can buy and sell items across Aelyria at different values based upon economic conditions, availability, and supply and demand, all of which can be simulated with a simple set of parameters. A real coup would be to totally automate this process, so that it is controlled by our servers and require no moderator tinkering, but I think it would be fun to allow moderators and players alike to have separate, special impacts on the economy, rather than to allow an impersonal/invisible engine to run in the background.


Anyways, that's my crack at this. Let me know what you think.

Best regards,
Juan

[Kaelon]

Links and Resources

Medieval Demographics Made Easy
A study on numbers in fantasy worlds, specifically population centers, and the number of supporting population ("SV") needed to exist before a certain industry emerges in a particular town or place. Great article and exceptional scholarship.

The Domesday Book Calculator
Derived from the above study, the Domesday Book Calculator generates medieval fantasy kingdoms based upon certain presumptions made about the world, the economy, and populations. This work is not suitable for projecting Aelyria, because it presumes the collapse of a huge empire (i.e., Rome) and the disintegration of all cities into smaller rural municipalities. But it is a great starting point for how to think about populations and numbers.

Population Urban Crisis
Vylle (aka, Wynd) started a conversation around Aelyria's population and economy back in 2002, and this thread is still considered the definitive background resource on trying to affix numbers to difficult concepts, like how many people can really live in cities. Note in particular my views on post #43 and my thoughts on housing on post #50 as well as my responses to Vylle's concerns on post #54. The whole thread is a great read.

The (Revised) Aelyria Big Price List
Built by moderators and players back in 2005, the Revised Big Price List set some basic rigures around different goods and services, and even began to propose modifiers and adjustments. Based off of the original Big Price List from 2002.

Medieval Sourcebook: Medieval Prices
A historic resource of items that were produced and sold in the middle ages, and how much these goods and services were valued using currencies of the Kingdom of England.

[Tiarela Iceglitter]

I like your idea on how to start it off, Juan... with the pricelist, and then modifiers based on the price list itself. The project Saka, Adelyn and I undertook would also fit into your plan nicely, as trade routes could be established. I think the biggest problem economically with Aelyria's current state is that we just dont know or have a realistic idea of what is happening in each city, province, and between them. Each place isn't a self sustaining machine, but because we just don't know the difference... we treat it in a pseudo self-sustaining manner. Using this, and eventually with the trade products project finished, we could easily cause the empire to feel the impact of say.. the destruction of a city (which seems to happen a lot to us ;P) or a small scale provincial war...or a blockade (like we had on Jaedaxia at one point)... In my personal experiences, the news in the empire of say, a city having hard times may be mentioned in another city... but the economic impact it has on that city goes unseen simply because figuring out exactly what the effect would be is kind of confusing. =)

Perhaps in terms of modifiers, once we set up the general ones for each city of province, we could also try to standardize something like "if x problem is happening to the trade partner y city for this good, then price increases by z amount." I know that isn't entirely realistic, but that is the best way I can think to effectively impact other cities by the events that are going on with other cities economically. (A good example would be the war in Sherian right now - trade partners with sherian cities and sherian cities themselves should be seeing price fluctuations based on less being able to get in or out, possibly, or simply the extra need for supplies in times of crisis, right? I'm not too up to speed on what exactly is going on down there, but I'm sure that the current state of things should be having an economic impact on surrounding areas, as well as the towns inside the province being effected.)

I don't really have any ideas that are different than yours at the moment, though one suggestion i'd like to make is that we make the system easy to follow and to use. If it is overly complicated, it will be harder to implement and enforce across the empire.

The hardest part to deal with once this is all hammered out is adjusting current businesses to match the new standardized economics. Will moderators be expected to go through with PCs that own businesses and readjust their income and expenses? I know that will be upsetting to some people, but it's all relative - if prices are standardized, they'll be spending less, so it really isn't a loss of funds. Just an adjustment that makes more sense based on the new official cost of things. =)

I'm sure more thoughts on the subject will come to me in a bit.. :P But thank you, Juan, for starting this! I can't wait to see economics really take off.. and of course help out wherever I can.

[Malvoitre]

Price raw materials instead. Keep it to simple categories like food, metals, timber, luxury, etc.

Then just add a construction fee to each finished good (swords, meals, houses). Let's say 5 crowns if the resource is near the city and 10 if not (adjustable by size, trade agreements, or other modifiers).

That way events can have real time effects of the prices of goods. For instance, if someone clears a gem mine of goblins in Centripax, the raw material prices for luxury goods would go down meaning a higher profit margin. Conversely if someone burns Candaceburg, food prices skyrocket and PCs who own restaurants can have their profits halted.

You could probably coordinate everything with a simple spreadsheet too.

[Kaelon]

Thanks, Everyone. I have updated post 2 above to some external and internal links that you may find useful in this discussion. One link I'm still looking for is a previous comprehensive price list (used in Aelyria), and a suggested price list for fantasy worlds in general. Does anyone know of resources like this handy? I'll keep the search up in the meantime.

Tiarela:

We're exactly on the same page. I particularly like your thoughts around building causal relationships between economies in Aelyria:

Perhaps in terms of modifiers, once we set up the general ones for each city of province, we could also try to standardize something like "if x problem is happening to the trade partner y city for this good, then price increases by z amount." I know that isn't entirely realistic, but that is the best way I can think to effectively impact other cities by the events that are going on with other cities economically. (A good example would be the war in Sherian right now - trade partners with sherian cities and sherian cities themselves should be seeing price fluctuations based on less being able to get in or out, possibly, or simply the extra need for supplies in times of crisis, right? I'm not too up to speed on what exactly is going on down there, but I'm sure that the current state of things should be having an economic impact on surrounding areas, as well as the towns inside the province being effected.)

You and Malvoitre are correct that once we have built in base prices and set modifiers for every location/region in the game world, then creating cause and effect could easily be maintained by spreadsheets (or, ideally, by a tracker on the website). Instability in one area of Aelyria can definitely impact the cost of goods and services in another, especially if there are established trade routes. Building comprehensive trade routes, like what you and Saka have been working on, is an awesome project and I feel can only be made easier with some real economic data to suggest (a) what goods and services are being produced in excess of local supplies (i.e., exportable), and (b) what goods and services are not being produced at all or are too few to meet local demand (i.e., importable).

Originally Posted by Tiarela

I don't really have any ideas that are different than yours at the moment, though one suggestion i'd like to make is that we make the system easy to follow and to use. If it is overly complicated, it will be harder to implement and enforce across the empire.

Absolutely. This is critical. Economics can be overwhelming, and it gets easily complicated. It's a perfect point to segway into what Mal said.

Malvoitre:

Originally Posted by Malvoitre

Price raw materials instead. Keep it to simple categories like food, metals, timber, luxury, etc.

I think this simple approach is a good starting point. I think what we will end up wanting to do is to create broad categories of goods (e.g., food, metals, wood, gold, gems), and then break up each category into tables that list generic items typically found within each category (e.g., "bread", "fruits", "vegetables", "poultry", etc.). We could have a modifier that impacts an entire category, and then a modifier that impacts a specific sub-category of items. Then, when moderators build price lists for their shops and markets, or construct business plans for player characters, they can refer to modifiers for their local place. Modifiers would have to be administered on the Unified Directorate level.

Originally Posted by Malvoitre

Then just add a construction fee to each finished good (swords, meals, houses). Let's say 5 crowns if the resource is near the city and 10 if not (adjustable by size, trade agreements, or other modifiers).

I like this approach, too, but I don't know how easy that would be to factor in. The cost of labor varies from place to place, too. For example, if you look at the first two links in post 2 above, you'll notice that different city-sizes produce a different number of industries, and are capable of sustaining different numbers of artisans and craftsmen. A city that is inundated with craftsmen of a particular trade would have extremely cheap labor to produce items in that class, whereas a city that has only one or two skilled craftsmen of a certain practition would be incredibly expensive. Supply and demand can be extrapolated to essentially all areas of the production and consumption matrix.

I do think you hit the nail on the head, however, that this sort of project can be managed by a simple spreadsheet. I also think that this has been done before, by people far wiser than I; I know that virtual economies have been built for most popular video games and table top role playing games, and price lists, models, and schemata have already been constructed, so I'd like to find some literature or links for those. I don't really want to re-invent the wheel, especially if there are already simple tools that we can use to get this kick-started.

Great thoughts -- please keep them coming, everyone!

[Ab'reth Yelkith]

I'm not sure I understand what you guys are working on. I might have missed an important point, but this is my understanding of things. It's good to have a resource for local gm's to use, maybe someone to help them out, or even basic concepts for them to keep in mind when they're developing their cities, provinces, etc, but the empire is a big and varied place. Goods are not going to have a uniform price everywhere. Fresh fish in Arakmat will be harder to get then it would be in Demos. Precious stones might be a little cheaper in Daltina because of the mine.

I suppose the imperial government could raise the price of goods in some regions to help balance this natural trend, but this would cause some problems balancing local supply and demand. The poor in Demios could perhaps no longer afford a main staple in their diet and merchants in Arakmat wouldn't have supplies able to manage higher demand. Taking this into mind, coupled with the trade issue, which when it comes to perishable goods can be an issue, it doesn't seem viable to force every city into a cookie cutter standard.

It might be a lot more useful to work on questions of money supply, the exchange of currency/forms of currency, taxation infrastructure.

I agree that some pc's make a needless amount of gold off of businesses they establish, and something should be done. It'd also be nice to see more of these businesses role-played out in the issues they're likely to face.

*Shrugs*

Why not just make an ic/ooc monitor position to moderate these sorts of things and work with local gm's? Like a agm of sorts.

*shrugs and wanders*

[Kaelon]

The point is, Ab'reth, that right now, moderators don't have an idea of how much something is "worth" at a base level. The base level is later extrapolated and modified to be influenced by things like supply and demand, trade routes, currency fluctuations, etc. This is a problem that has really only one fix to it -- getting all moderators and players on the same page around basic value of items.

Using a real world example -- gasoline in the United States -- the problem is that right now, a moderator in one city might price gasoline at $1.00 a gallon, whereas another moderator in another city might price gasoline at $10.00 a gallon. While the value of goods and services across geographies clearly differ and fluctuate based upon supply and demand, trade, waste and corruption, and currency markets, the decisions that are presently being made are -- more often than not -- being made largely arbitrarily and without any economic basis. It's not really anyone's fault -- this is a problem that Aelyria has faced since its inception. But the fix, in my view, is to get some solid, simple resources that (a) standardize the value of goods and services; (b) systematically generate fluctuations and variance from location to location; and (c) simulate economic concepts, like supply and demand, production and consumption, currency markets (as you rightly raise), corruption and waste, and trade routes.

[Malvoitre]

I think everything would still come down to yes/no (01) modifiers, though. Examples:

Good produced in town: yes/no

If no, then, Good produced nearby: yes/no

If no, then, Is town on major trade route: yes/no

If no, then, Is town large or rural (for general demand purposes)?

Every "no" answer would lead to a positive price modifier. Each "yes" would lead to a negative one.

This still doesn't do anything to give us an overall understanding of the value of the crown, though. The issue of demand comes down to what PCs are willing to pay for something. Generally they're able to hoard money (like Malvoitre with a good salary and very few living expenses) to the point where 500 crowns for a sword isn't a big deal. Right now GMs are responsible for the amount of money a certain PC has to actually spend, and they're usually very generous people. Any tinkering on a macro level won't change that.

[Kaelon]

Very good point, Malvoitre. If we put into play supply/demand modifiers, then the amount of currency in the system will actually begin to determine the prices of items, which would only make sense if game masters already had a notion of the value of the Crown, which would need to be set by the goods and services. It's a paradox, ultimately, because rather than our economic system emerging organically, it was arbitrarily set at random figures back when we started the game in 1989, and the more moderators that have come into the mix, the more random (and contradictory) these figures became. So the only way to fix it would be to set the general value of the Crown.

I, and others, always thought that our currency should be valued something kind of like this:

One Aelyrian Crown buys a copy of the Herald. Two or Three Aelyrian Crowns would buy a meal at a restaurant. One Aelyrian Aureus (or 25 Crowns) would buy a good saddle. Eight Aelyrian Aeurea (or 200 Crowns) would get you a fine horse.

But the basic value of goods and services would first need to be set against, right?

[Malvoitre]

Originally Posted by Kaelon

If we put into play supply/demand modifiers, then the amount of currency in the system will actually begin to determine the prices of items

That right there is why an organic economy may be difficult to master. A government can generally control the amount of its currency in the world. The US, for example, could revalue the dollar by halting production of the greenback, or buying it at high prices on foreign markets. Not so easy to do when a mod can reward players by making 100,000 crowns appear in a field.

Otherwise you could backpedal from the total amount of currency (10 million crowns, for example), average it over all citizens (5 million, for example), and come up with a standard for average wealth (2 crowns per person). Knowing how many crowns each citizen had on average would give you a general idea of how much they would be willing to spend on food each day (in my example, obviously not very much).

But hey, it's worth a shot. Starting with the values on goods and services would be a nice place to start. I just wonder if mods will really consider them when handing out rewards and salaries.

[Kaelon]

Great thoughts, Malvoitre. I like this thinking, if only because it leads me to several conclusions I'd like to run by you (and our other readers):

-- Player Characters in Aelyria are atypical inhabitants of the world, and as heroes and villains, they can be expected to have significantly more in the way of possessions and wealth than a typical inhabitant of Aelyria would.

-- Goods and services should be valued in accordance with what a typical inhabitant in Aelyria, not necessarily an Adventurer, would be able to afford; however, specialty items that are clearly meant for adventurous types should be priced accordingly to adventurers. (For example, food would be a typical good; whereas magical food designed for adventuring would be atypical.)

-- Operating from the 500 Crown starting "spending money" standard that new characters obtain, do you think it makes sense to use 500 Crowns as a typical starting out fund for atypical adventurers, and extrapolate expected purchases around this starting value to build some goods and services pricing?

[Mimesis]

speaking of currency - this gave me a question. All of these cities (like mine!! ) who mine stuff... like gold... do we or not have the right/ability to mint crowns?

My initial feeling would be that it might be hard to coordinate a central mint for the whole empire - but honestly, I have no idea.

Never thought about this before.

[Kaelon]

Originally Posted by Mimesis

speaking of currency - this gave me a question. All of these cities (like mine!! ) who mine stuff... like gold... do we or not have the right/ability to mint crowns?

My initial feeling would be that it might be hard to coordinate a central mint for the whole empire - but honestly, I have no idea.

Never thought about this before.

There are three Wiki articles that give some good background on that: Gold Crown, Silver Coin, and Copper Centime, respectively. But the short answer is -- you are correct. The Gold Crowns (which aren't really "gold") are typically minted only in the "Royal Mints", while Silver Coins (which aren't really "silver") are minted hastily for propaganda purposes. Back in the day when we used Copper Centimes (which actually have a bit of "real" copper in them), Cities and Provinces used to be able to order them for their branch offices of the Bank of Aelyria and get custom designs. Maybe the Copper Centime will come back in style?

[Mikhail Vashael]

A base worth is a good idea. Restricting the creativity of the design team unnecessarily isn't. I'd like to see economic moderation connect with realmcrafting, designers and game mods directly. That way real dialogue is created between creation and balancing Aelyria as a whole.
Basically.. talk to us. See a problem, bring it up.. Send a PM to the person responsible or an economic mod. Variables and economic realities are extremely useful, but will never make up for the shared wisdom and inspiration of our community. RealmCrafters rarely wish to unbalance the experience, only create situations and environments that will gratify and satisfy. It is finding that harmony between inspiration and limitation that will make us stronger in the end.

I suspect the building of real Risks and Rewards around economics will face considerable controversy, especially for designers of locations who have come to expect or anticipate a certain wealth/income level, only to realize that their expectations may be different from the economic realities. But holding location designers accountable to the same economic rules that players abide by is critical to creating a realistic, enjoyable, and balanced system of financial risk and reward.

[Kaelon]

Excellent points, Mikhail. So, what you're saying is, use the modifiers as a guide -- rather than a hard-and-fast rule. That makes it a lot easier to enforce, and ensures that moderators and players, creative designers and realmcrafters, still have the freedom and flexibility to adjust pricing on a micro-level, using the macro-economic data as a guide rather than as a rule. Did I get that right?