Tip.It Times Presents: Inflation and the Runescape Economy

This week's Tip.It Times has been released. Feel free to discuss the article or post any comments. If you have any criticism, please make sure it's constructive! :D

Inflation and the Runescape Economy

 

The Editor

 

 

 

I know, this is a topic that's come up before. It will probably come up again as the RuneScape Economy is something that your Editor finds endlessly fascinating (your Editor, in case you hadn't noticed, is a genuine Nerd!). The RuneScape Economy has been designed to be...

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Yay, another economy editorial, I love them ^^

very comical and informing, i sympathise with the editor with the abyss pkers though lol

Nice article.

I always shake my head when someone comments about an idea in the suggestions forum that "it will ruin the economy!".

This article, though not addressing the statement directly, does touch on why such a claim is bogus. Every update RS makes affects the economy. But because of high-alching, supply and demand, and the rarity of rares, the economy can never be "ruined." Oh, prices of items will fluxuate. But there are two constants that will ensure relative stability on the RS economy:

1. There will always be more new players

2. There will always be the desire of players to obtain stuff

Growth and greed - count on it, and you'll understand why the economy cannot be ruined.

- Sligo

Another economic editorial. Quite informative and entertaining as usual. I don't see why people complain so much about inflation, as it is a sign of a growing and healthy economy. If there was overall deflation, that'd be a bad sign - look at Japan's situation. So, hurray for inflation!

Hmm.. another key role is all the new players coming in everyday, whether they be pures made by people who already have experience, new people to the game or macroers, they bring in about 20 items but only 25 gp. Could this be a factor?

I really like these topics on deflation and inflation and estimates on total gp in game. Keep 'em coming. =D>

Interesting article!

Construction is a smart move from jagex to stop inflation but it will never be enough to stop the rares from raising.

Great article. The ones about the economy of Runescape are usually top notch, and very informative. :)

Keep the ones like this coming, everyone likes to know a little more about the game they are playing. :D

honestly, ess prices just jumped by 10gp. I thought, the economy is inflating again. I put the blame on lunar mage, you know, demand for runes goes up, demand for ess goes up, prices go up. i never thought about high alch. it's always great to hear a second opinion.

Great article! I liked how you compared it to the real world and informed us about it, very nicely done...

Woot first page post! Great article, interesting to learn that much more about the economy. I love the way you dissed the US government =D> BTW great idea with using fairy rings for runecrafting... which ring do you think is closer to the nat altar, the one near tai bwo wannai or the one near the karambwan fishing spot? and would you bank at zanaris or is there a fairy ring closer to a bank...

EDIT: Ok i think i have it figured out. Start by fairy ring tele-ing (heehee a rhyme \ ) to the ring northeast of Shilo Village (combination CKR). Then run down to the nature altar, and craft your nats. Next, either Glory to edgeville, or walk back to the fairy ring and take it to the edgeville fairy ring (combination DKR). Either way, bank, then head to the edgeville fairy ring and go back to the Shilo village ring. I cant wait i cant wait i cant wait to be free of the abyss, although now i need a nature tally :boohoo:

I think this is why people hate inflation (correct me if I'm wrong): The prices of goods rises, and the player have to make more money in order to buy goods. And to the wide spread of merchanting, the "wanna-be pro" merchanters buy thier stuff for super cheap. Thus maknig the players work longer until they can actully buy a item.

I think this is why people hate inflation (correct me if I'm wrong): The prices of goods rises, and the player have to make more money in order to buy goods. And to the wide spread of merchanting, the "wanna-be pro" merchanters buy thier stuff for super cheap. Thus maknig the players work longer until they can actully buy a item.

Hmm. Kinda like real life. Just be glad RS doesn't charge taxes.

- Sligo

I think the top reason people lose rares is of getting banned; I mean think about it, not many go fighting things that can kill them with Santa hat, and I doubt ANYONE would go to the wilderness with Party hats. Remember the article, about a month ago, was it? About the guy that auto mined and his bank got cleared out? Somthing like that.

trust me i know how it feels getting something and then having it drop or go up in price the next day...

great artilcle though

The Editor is such a nerd :-w :3>

I know that the rising costs are bad but the low lvls like it casue they can can get good things faster.(Im not saying im a low-lvl).But i would like full rune and im poor.with the lower costs ill get it sooner but it will be less valuble!This is like americas great derpression!

That's a very clever outlook of the game, and i believe more people will begin to see your perspective :-w Great article, keep em' coming :

lol for the last paragraph, nice read 8-)

Great article, well thought out.

Was a pleasure to read.

nice article but cmon m8, look at my siggy and see how many 100's of thousands of things i have crafted fletched alched mined and runecrafted...afew hundred nats is like 15 mins

Brilliant article! :3>

Keep up the good work! :thumbsup:

Good article, but you left out runecrafting.

Us runecrafters make market prices change. LOOK AT ESSENCE!! AND NATS!! OH EM GEE!

horrible article. so many words which basically said nothing. what was the conclusion of the article? more money coming in? items costing less, rares costing more?

no duh!!

its better to write nothing at all then the same dumb thing over and over.

The article is more an introduction lesson to inflation rather then really discussing anything regarding RuneScape's economy.

The other thing that can drive prices up in the real world is amount of goods available. If there is a bad year for the coffee harvest for example, the cost of coffee goes up. A bumper crop means lower prices for the consumer. The price of oil is currently going up almost on a daily basis because of the war in the Middle East. Not so much because it's a war zone, but because of the damage done to the infrastructure by the war - broken pipelines, disabled refineries, etc. have reduced oil production by about 50%.

This is not really inflation in my opinion, but that may depend slightly on your definition of inflation. I usually refer to money supply increase when talking about inflation though.

High Level Alchemy is necessary to the game. OK, we could all sell our piles of crafted gear to the shops for a lot less money, but alching them not only gives us more money, it also takes the goods out of the game

Selling to shops also takes the goods out of the game, as the shops remove them from their stocks slowly. Nevertheless, from an economic point of view, High Level Alchemy and selling to shops are practically the same - let's call it the NPC-buy value.

I'm not sure that it's possible to design a game like RuneScape, where skills require so much repetition to earn experience, that isn't inflationary in nature. It might be fun to try though. In the meantime, I guess we'll all have to live with it and, just as in real life, the rich will get richer and the rest of us will struggle to keep up.

It's really not that hard to design a MMORPG with massive repetition that doesn't have such an extreme inflation as RuneScape has. The whole issue lies mainly in the NPC-buy value. It basically serves as a price floor, with unlimited money creation to back-up the price floor.

This in turn creates a situation where the creation of money is extremely uncontrolled. People need to make 100K's of bows, plates, etc to train their skills. The problem is that there is no real demand for all these items, so they are all "sold" for the game-implemented price floor. Point is that people aren't making those bows and plates for the money, but for the experience. Yet, billions of gp are created as a "side effect".

So how could this work differently? Well the answer seems simple: remove the unnatural price floors. However this has large consequences for the skilling system: what to be done with the huge amount of demandless finished products?

In my opinion the only viable solution for that is to allow for the 'detachment' of the finished products. Allow steel plates to be resmelted in bars again. Allow bows to be detached to logs again. And make it so that people get less materials back from the detachment of the finished products then it costs to make the finished products. In this way there is demand / use for the finished products and they'll also slowly leave the economy without introducing money.

Furthermore the whole idea of monsters dropping gold should be reviewed. People mainly train on monsters to gain experience - again not for the money. Remove gold being dropped by monsters as well.

Ok so by now you may wonder "uhh you just removed all money creation". Yes, that's why you'll also need to introduce a new way to create money. I'll refrain from describing it very detailed, but the idea is that there should be a way to gain money which does not gain you (much if at all) experience.

The point is that people will only do this to gain the money (note the difference to all the current ways of money creation, where people gain money as a side-effect to their main goal, which is gaining experience!). This will ensure that the money is created in a controlled way. If the 'value of money' is too low, people will stop creating money, effectively increasing the value of money over time again.