Thoughts about the digital economy.

[poopskin25]

The economy in RS is hitting the wall, period. end.

 

 

 

Does anybody but me remember when 1k was something to be treasured, not tossed out away at a moments notice? Inflation seems to fast becoming an obvious problem to even casual F2Pers like myself. The prices of many items are gradually increasing, and it is much easier to make money than it was a year or two ago.

 

The problem seems to be rooted it how the game itself is built. Gold is spontaneously created in many different ways, and there are very few ways to remove it from circulation. When you kill a goblin, it will leave behind 5-10 gold where it died, this gold is spontaneously created, and did not come from anywhere. It also happens when you sell something at a shop, or complete a quest with gold as a reward. This is akin to the United States Department of Treasury deciding to perpetually run the printers for 1$ bills. Money is constantly created, lowering it's value and increasing prices of mostly everything. I believe that this is a serious issue, due to the fact that it drives up prices and makes it difficult for the game to exist as a functional economy. This would not be a problem if there were a way to remove an equal amount of gold from the system whenever this happened. Unfortunatly, there are very few ways to do this, so the amount of gold in circulation increases continuously.

 

 

 

Does anybody have suggestions on how to solve this? Or comments on the situation itself...

 

 

 

I am putting together a list of things jagex could change about the game, which would create ways to leech gold out of the system, here are some of the things I have thought up so far.

 

 

 

1) Place a 3-5% tax on all monetary transactions between players involving quantities of 50k or greater

 

 

 

2) Make weapons and armomr detirorate with use, and place several NPC's ingame able to repair them for an amount of money depending upon the item being repaired. The money spent on this would be removed from circulation

 

 

 

-The library is closing and I have to log off, I will finish this post later, until then, feel free to post possible solutions or comments-

[axeraider194]

It's something that happens to all games eventually.

 

 

 

Keep in mind that the reason the economy isn't the same as it was before, are these reasons:

 

 

 

-More people join every single day.

 

 

 

-More people are making more money every single day (You have more money now than 5 months ago, don't you?)

 

 

 

-Skills keep on going up, there are already 21 people all maxed out with a max total.

 

 

 

 

 

Also, the fact that simple methods of cash (ess running, collecting white berries/snapes/blue scales) are extremely quick cash, and require little or no skill.

[Hi9im8Here7]

This is akin to the United States Department of Treasury deciding to perpetually run the printers for 1$ bills.

 

 

 

They do, only with 20s :XD:

[highlanders]

I guess that's what construction was created: to drain money off the economy.

[poopskin25]

in response to your post, axeraider...

 

 

 

Basic economics dictates that the money that people make (exceptions being the small proportion that was "created" by them) came from somewhere. This means that by making money, most people are taking the money that was already "created" from other people by way of trades. Most methods of moneymaking are not covered by your argument that "people are making more money every day"

 

 

 

I think that will makes sense...

 

 

 

Also, skills also have little to do with inflation. Say I have a very high level in mining and smithing, and I use those skills to mine rune and smith it into scimitars, which I then sell to other players. Nowhere in that process is money being "created", it is coming from other players.

 

 

 

Unfortunatley, the fact that these don't bring money into the system does little to offset the large amount of money that is brought in by goblin-bashing, etc.

 

 

 

My bad with the US Mint example

[alcoolj]

The problem stems from a variety of sources, notably alching. There are many 99 fletchers out there who made/strung yew longs or mage longs which have been alched into new currency. There is no money sink greater than construction, yet the money coming in is far greater than the money sink of construction. Sure there are bannings of players with phat sets occurring at times, but this will still not offset the alching. Exact numbers are hard to conjure up, only Jagex could know for sure how much dough is coming in vs going out.

 

 

 

MTK is also a money sink, albeit one that gathers raw goods cheaply - nevertheless one that makes gp dissappear - 75k per day from every player who maxes out MTK is still a small number compared to the alchers.

 

 

 

Alching is the number 1 curse for inflation in RS, and one way to stem it is to make nat crafting harder, more costly, and hence less profitable to alch, making teleing the most cost effective method to raise mage. I doubt the rants board could handle the influx though!

[123Yourgone]

There is a tonne of money drains in rs though, miscelania, boats, shops, construction, entrance fees, and the money is getting spread out to new players, no ones really getting a whole lot richer off inflation and prices arnt changing drastically.

 

Rare prices are more stable now then they have ever been in the 7 years i have played.

[poopskin25]

I agree with Alcoolj, alching offers great xp for mages, as well as a fast supply of cash. As long as the items being alched can be made without sinking any money, a large volume of gold is injected into the digital economy. I would suggest getting rid of the alch spells totally, thought I don't think that is a feasible option, seeing that a large portion of players use high alch regularly and would be extremely upset. It would most likely be better off to tweak the item values for high alching, making it so that less money is injected into the system whenever a player uses the spell.

[Rebdragon]

What proof is there that inflation (total gp in game), in the Runescape economy, is bad? What about it is so drastic that you would actually suggest completely removing the alchemy spells, the life and blood of magic training, or adding frikking taxes? This isn't the real world bub. This is Runescape.

 

 

 

You don't see prices for items rising beyond the consumer's ability to pay, and prices have been been fluctuating around the same general area for years, not rising to the amazing levels that basic economy would predict. Look at Yews for example. For the past few years they ran for 300ea, easily. But when mass amounts of autoers were added to the equation, the prices hit rock bottom in the low 200's. If you're theory about rampant inflation was correct, would not the massive amount of money in the game cause the price of Yews, and other raw materials, to rise dramatically? And yet, they don't. In fact, the only reason prices of raw materials seem to rise is due to changes in the game via weekly updates, such as the sudden drastic rune essense rises in price. What evidence do you have that inflation is the main driver of price changes, rather changes in other aspects of the game?

 

 

 

And for that matter, are you willing to risk the possible of deflation on a random hunch that inflation is bad for the Runescape economy? Think about it for a second: Inflation makes people's banks worth more, gives them more money to spend. Worst case scenario it runs amuk and everyone has millions upon millions in their bank. Which doesn't really pose much of a problem.

 

 

 

But.... deflation, at high enough levels, enough economical error in updates, for a long enough period of time, could actually cause the destruction of the economy, unlike inflation. Inflation at it's worse creates more money, which just dissappears into the banks of players who all eventually quit and essentially remove that money from the game. Deflation, on the other hand, at it's worse can remove enough money from the game that it actually causes shortages of money among players, and if kept unchecked could remove enough gp from the game to make it impossible to keep an economy running.

 

 

 

By trying to balance out inflation, you run the risk of overbalancing the equation and causing deflation. Is that what you really want? Do you want to create a real threat in order to eliminate an imaginary threat?

 

 

 

The game isn't going under any economic stress, and it never will. Establish, with reliable facts, information, and intelligience, that the Runescape economy is actually being damaged by inflation before you try and unnecessarily fix something that isn't broken.

[solidsteve]

from what i understand about gp in runescape is that there are many ways off just using it on npc's

 

 

 

the runescape market is only there because people han the bright idea to trade money for items i mean whats the problem with just trading the items you have for the items you want, thats why its called a trade system

 

 

 

people on this game think money makes runescape go and dont think about what they do on runescape

 

 

 

take this for example a player decides he wants a better magic level, he thinks the easy way is to high alch yew bows so he starts getting money for it

 

 

 

one week later he has the wanted level and 2x his money

 

 

 

now for a different way, the player looks at his skills he see's rune crafting and mining and decides to do them also, 1 week later he has higher rune crafting and mining along side the runes he needs to get the level he wants

 

 

 

then he starts killing green dragons, burying bones and banking hides as he is going 1 week later he has higher prayer and magic level with enuf hides for crafting

[Hi9im8Here7]

from what i understand about gp in runescape is that there are many ways off just using it on npc's

 

 

 

the runescape market is only there because people han the bright idea to trade money for items i mean whats the problem with just trading the items you have for the items you want, thats why its called a trade system

 

 

 

people on this game think money makes runescape go and dont think about what they do on runescape

 

 

 

take this for example a player decides he wants a better magic level, he thinks the easy way is to high alch yew bows so he starts getting money for it

 

 

 

one week later he has the wanted level and 2x his money

 

 

 

now for a different way, the player looks at his skills he see's rune crafting and mining and decides to do them also, 1 week later he has higher rune crafting and mining along side the runes he needs to get the level he wants

 

 

 

then he starts killing green dragons, burying bones and banking hides as he is going 1 week later he has higher prayer and magic level with enuf hides for crafting

 

 

 

Very few people will do absolutely everything themselves (I have seen a few...).

 

 

 

Are you seriously suggesting that runescape become a barter economy? Come on do you know how detrimental that could be? It would be almost impossible to make a trade.

 

 

 

Money is the representation of labor somebody put into the game. People get it through one form of labor and trade it for another form. It's simple economics. The reason hardly anybody does things themselves is because they would just be less efficient that way (ex. it's much more cost effective just buying your p ess instead of mining it yourself if you're alching nats).

 

 

 

You don't like people's obsession with money? Welcome to america.

 

 

 

Inflation does sound bad, but I don't think it would solely wreak the economy. Just remember, while all those alchers in seers are bringing money into the game, all those monster hunters at the KQ are bringing merchandise like d chains into the game.

 

 

 

Of course the system might not be perfect, but like I said, the federal banks really do print money without any backing when they need it. :shock:

 

 

 

The only thing I would worry about is a half-baked update or bug that single-handedly wreaked the economy (you know it would be kind of interesting witnessing the implications of economic phases through an online game :) )

[solidsteve]

from what i understand about gp in runescape is that there are many ways off just using it on npc's

 

 

 

the runescape market is only there because people han the bright idea to trade money for items i mean whats the problem with just trading the items you have for the items you want, thats why its called a trade system

 

 

 

people on this game think money makes runescape go and dont think about what they do on runescape

 

 

 

take this for example a player decides he wants a better magic level, he thinks the easy way is to high alch yew bows so he starts getting money for it

 

 

 

one week later he has the wanted level and 2x his money

 

 

 

now for a different way, the player looks at his skills he see's rune crafting and mining and decides to do them also, 1 week later he has higher rune crafting and mining along side the runes he needs to get the level he wants

 

 

 

then he starts killing green dragons, burying bones and banking hides as he is going 1 week later he has higher prayer and magic level with enuf hides for crafting

 

 

 

Very few people will do absolutely everything themselves (I have seen a few...).

 

 

 

Are you seriously suggesting that runescape become a barter economy? Come on do you know how detrimental that could be? It would be almost impossible to make a trade.

 

 

 

Money is the representation of labor somebody put into the game. People get it through one form of labor and trade it for another form. It's simple economics. The reason hardly anybody does things themselves is because they would just be less efficient that way (ex. it's much more cost effective just buying your p ess instead of mining it yourself if you're alching nats).

 

 

 

You don't like people's obsession with money? Welcome to america.

 

 

 

Inflation does sound bad, but I don't think it would solely wreak the economy. Just remember, while all those alchers in seers are bringing money into the game, all those monster hunters at the KQ are bringing merchandise like d chains into the game.

 

 

 

Of course the system might not be perfect, but like I said, the federal banks really do print money without any backing when they need it. :shock:

 

 

 

The only thing I would worry about is a half-baked update or bug that single-handedly wreaked the economy (you know it would be kind of interesting witnessing the implications of economic phases through an online game :) )

 

 

 

yep but i just hate it when people say the runescape market is going to crash

 

 

 

its just like so what you can quite easyley get the things your self, might take you a bit longer but you get the same effect

[Jimmonkey2]

 

++

 

 

 

Why does it matter? It's not as if the Runescape economy is competing against any other economies.

[Hi9im8Here7]

 

++

 

 

 

Why does it matter? It's not as if the Runescape economy is competing against any other economies.

 

 

 

That doesn't mean it can't crash.

[Mithril_Max]

its most likely never gonna crash no matter how many people say it will, even if it does its only an mmorpg and i cant see it doing any real harm besides confusing merchants for a month or two

[Hi9im8Here7]

its most likely never gonna crash no matter how many people say it will, even if it does its only an mmorpg and i cant see it doing any real harm besides confusing merchants for a month or two

 

 

 

A bug might set it off. What if the alching spells suddenly stopped working. What if an error made it possible to attack anyone anywhere?

[Mico]

its most likely never gonna crash no matter how many people say it will, even if it does its only an mmorpg and i cant see it doing any real harm besides confusing merchants for a month or two

 

 

 

A bug might set it off. What if the alching spells suddenly stopped working. What if an error made it possible to attack anyone anywhere?

 

 

 

Then it would kinda look like...real life?

[Kebabkilla]

Yes the economy is in bad shape but I dont believe it can be changed, when Construction came out it did barely anything to drain money, prices stayed the same and Runescape continued at the same pace. Since Jagex has been releasing new skills every 6 months to a year I would have to say a new skill could come out soon that has a large money drain much more then construction.

 

 

 

I started to play 3 years ago and remember santas for 100k but then, more people with rares quit playing causing prices to rise. I remember when Duke Freedom got banned and since it was rumored he had 500 Santas the prices went up 5M in a day :shock:

 

 

 

It is either that or Jagex doesnt really care how the economy is, we made the mess and they expect us to clean it up while they roll around in money

[Hi9im8Here7]

I remember when Duke Freedom got banned and since it was rumored he had 500 Santas the prices went up 5M in a day Shocked

 

 

 

 

Theoretically the price shouldn't rise, since all those santas were just sitting in the bank and out of circulation.

[Rebdragon]

I remember when Duke Freedom got banned and since it was rumored he had 500 Santas the prices went up 5M in a day Shocked

 

 

 

 

Theoretically the price shouldn't rise, since all those santas were just sitting in the bank and out of circulation.

 

Correct, but it would probably rise due to the reaction of the population to the banning :-k .

[klankaos]

I remember when Duke Freedom got banned and since it was rumored he had 500 Santas the prices went up 5M in a day Shocked

 

 

 

 

Theoretically the price shouldn't rise, since all those santas were just sitting in the bank and out of circulation.

 

Correct, but it would probably rise due to the reaction of the population to the banning :-k .

 

 

 

Ah, now we come to the real driving force behind any economy in the world - the population. No economy can run without a population to feed it. And with the driving power of the population comes the possibility that the economy will be drastically changed by a simple little tidbit of news. Consider this fact of Duke Freedom quitting. When those santas went up 5m in a day, that wasn't because of any true logical reason. As is pointed out by Hi9im8here7, the price really shouldn't have changed, had everyone realized that. However, the effect of santas suddenly being 500 less cause a HUGE boom in their prices. This is a classic example of the reaction of the population to a single event changing the economy.

 

 

 

Now consider this in real life terms. We all know Tiger Woods has a contract with Nike to use their equipment for advertising purposes. We're equating santas to a real-world product line here, as opposed to a single item, because very few single items are as rare as santas. Suppose Tiger decided to change from Nike to Adidas (if they even make golf clubs?) equipment. This simple fact doesn't change the quality of the clubs, nor does it change the amount of clubs in circulation by any significant amount. However, Adidas' sales would immediately skyrocket due to the new popularity of their prodct, and Nike's would plummet. This would have an effect on the stock market, which could theoretically affect other products as well. So one person changing the clubs they use in the game of golf can affect every other product out there. Duke Freedom's banning is another example of this, but in RS terms. Although his banning truly did result in the lowering of the number of santas in circulation, it was his popularity (and thus, the mood of the people) that changed the market price of santas so much. It's worth stating again - the population defines the market.

 

 

 

The only true way for Jagex to combat inflation is to introduce another skill or game such as Construction, a major money drain. Or, they could reduce the flow of money into the game by lowering alch prices, prices for selling to shops or gold from monster drops and rewards from minigames. The lessening of the amount of money in the game is the only way to truly combat inflation. However, if Jagex should overcombat it, it is a true possibility that deflation might occur. Nobody would buy any materials from other players, choosing instead to raise their own levels. This would be terrible for the economy, because there would simply no longer be an economy. The value of the gold piece would be nonexistent, except to buy from stores, and it's almost as easy to get the items as monster drops. The price of all items would rise, except for the raw resources that anybody can get. The weapons and armour (e.g. dragon chains) that can only be obtained through monsters would explode, and the price of raw resources would go down. Therefore, it's in Jagex's better interest to combat inflation, but not overly destroy it.

[poopskin25]

Well said...

[archangel]

Well first off, there are kinds of armor that deteriate with use (barrows)

 

and um most trades between players are much,much, more than 50k.

 

and jagex is trying to lower the amount of gold, they baned alot of players for real world trading, and one of those accounts holds about 300million to 1billon or more. and they banned about 1k or 10k players? im not sure.

 

but also there are people who take a break and when they return more money flows in.

 

Inflation happens, its inevitable, it happens in games and in countrys

 

its the circle in economy, inflation, then money drops then steady then infaltion...etc we havent really seen this circle since the game is still pretty young.

[archangel]

what klan kaos's quotes said was true, very true indeed.

 

But there was one fact that was overlooked, due to the reaction of the 500 santas gone, players thought they would rise, which they did, but the players didnt think of what klan kaos said, since the 500 santas were out of circulation they didnt really have an effect on the price. But players didnt think of that, instead they just bought santas like crazy and therefore the price rised.

 

 

 

I mean when that point was said, i thought "wow, that was amazingly ingenious, but then i thought about it again and came up with this.

 

( just wanted to express my view on that subject, not flamming or spamming)

[123Yourgone]

I remember when Duke Freedom got banned and since it was rumored he had 500 Santas the prices went up 5M in a day Shocked

 

 

 

 

Theoretically the price shouldn't rise, since all those santas were just sitting in the bank and out of circulation.

 

Correct, but it would probably rise due to the reaction of the population to the banning :-k .

 

 

 

Ah, now we come to the real driving force behind any economy in the world - the population. No economy can run without a population to feed it. And with the driving power of the population comes the possibility that the economy will be drastically changed by a simple little tidbit of news. Consider this fact of Duke Freedom quitting. When those santas went up 5m in a day, that wasn't because of any true logical reason.

 

Duke didnt quit he wasnt permenantly banned, thus all of those santas were removed from the game forever, thats a reasonable reason for a price hike.