Sorry, Comrade, but Price Controls Don���¢�¢â�š�¬�¢â�ž�¢t Work

[ixfd64]

Very nice read. You should submit it to the Tip.It times as a guest article. :)

[mario_sunny]

How do you know that jagex intended for this update to ruin merchants? I don't remember them announcing this, although you can correct me if I'm wrong.

 

 

 

Other than that, very good, detailed read. I love your articles qeltar and always try to them all the way through. :)

[qeltar]

So why are they needed here?

To avoid price manipulation. Read the update.

 

 

 

 

It wasn't any more necessary to set a 5% trading range and 24 hour updates to stop price manipulation than it was necessary to limit stakes to 3k to stop RWT.

 

 

 

It's about control.

[alcoolj]

I sold all my calquat seeds in about 1 hour, so it will happen :)

 

 

 

Other than the inability for it still hard to sell 'hard to sell items' no change there is there, I think the GE is great :)

[Triforceelf]

 

Peronix, Triforceelf and Danqazmlp: If you notice in the article I mention examples of shortages and lines. They are caused by the price controls. The only reason anyone has to wait for hours to sell nats or calquat seeds is because there aren't enough buyers. It's the exact same situation as the gas shortages, only in reverse.

 

 

 

So this doesn't negate my point, it reinforces it. In a healthy, functional market you can sell nearly any common item in a few seconds. That's what I had hoped the GE would be, instead of the cumbersome nuisance it is now because of Jagex's desire to control the market.

 

 

 

That is a major overstatement. There plenty of healthy markets were it can take a very long time to sell something. Even on very healthy housing market it can take several weeks of listing to sell a house, and the less desirable (or expensive) the house the longer it will take to sell it. The same is true with alot of other speicalty real world items such as collectables: you have to find the right buyer, and that takes time. Also, if you have a surpluse of an item it becomes a buyers market, where everyone can buy low (even if its only 5% low) and still have their needs met. The same is true of the GE: lots of people are dumping items right now, over time it will slow down. But even then i dont think calaquat seeds will sell in 5 minutes.

[qeltar]

 

That is a major overstatement. There plenty of healthy markets were it can take a very long time to sell something. Even on very healthy housing market it can take several weeks of listing to sell a house, and the less desirable (or expensive) the house the longer it will take to sell it. The same is true with alot of other speicalty real world items such as collectables: you have to find the right buyer, and that takes time.

 

 

This comparison is not valid because those are unique, one-of-a-kind items, so each must be matched up with a specific buyer who will appreciate its characteristics.

 

 

 

Calquat seeds are not unique; one calquat seed is the same as the next (a concept called "fungibility"). Therefore, if the market is set up properly, they are easy to sell.

 

 

Also, if you have a surpluse of an item it becomes a buyers market, where everyone can buy low (even if its only 5% low) and still have their needs met.

 

 

That's only true if the prices are close to the real market price.

 

 

The same is true of the GE: lots of people are dumping items right now, over time it will slow down. But even then i dont think calaquat seeds will sell in 5 minutes.

 

 

 

No, because this system doesn't work properly. If Jagex weren't trying to control prices, I could sell them in 5 seconds right now -- just as I could sell them in 5 seconds on the forums.

[Shadowcheval]

I just have to say, you set yourself up here as and Adam Smith with your talk of "free markets". While I don't necessarily agree with Jagex's 5% limit, I do agree that the deregulated economy was problematic. Buying things from the perspective of a player that tended not to do it very often was a pain. I'd have to set aside long periods of time before I could buy whatever it was that I was looking for. While you do agree that the GE acomplishes that, you complain about the price limits, while you also state that Jagex will still continue to modify the GE. While this is pure speculation, I doubt that the conditions you ascribe to are going to remain the same over the course of the week.

[berbatovsky]

Surprise, surprise I disagree

 

 

 

1)Runescape is not real life, children play this game, children are impatient and greedy and have little to no understanding of action=reaction

 

 

 

2)The main reason things aren't selling is precisely because of supply and demand, there is [bleep] all demand for Calquat seeds(and possibly because of the way the system prioritizes sales/purchases).

 

 

 

Also don't use real world economic theories to describe the situation in the game, the only one that counts/transfers is supply and demand.

[qeltar]

 

1)Runescape is not real life, children play this game, children are impatient and greedy and have little to no understanding of action=reaction

 

 

Relevance = ?

 

 

2)The main reason things aren't selling is precisely because of supply and demand, there is [bleep] all demand for Calquat seeds(and possibly because of the way the system prioritizes sales/purchases).

 

 

The reason why there is too much supply and not enough demand is that the prices are too high and sellers can't lower them.

 

 

 

Why is that so difficult for some people to understand? I can only sell calquat seeds for 38k or whatever. If I could sell them for 29k or so, they'd have been sold hours ago. Is this really hard to understand? I don't get it.

 

 

Also don't use real world economic theories to describe the situation in the game, the only one that counts/transfers is supply and demand.

 

And that's the entire basis of my article, and why this exchange isn't nearly as good as it could have been - Jagex is mucking with supply and demand.

[alcoolj]

Problem with GE is that it seems as though the 1st in 1st served rule is being used, which is fair enough I guess. Problem occurs when someone has 500k nats, willows, maples, flax, etc all at the lowest cost. Anyone after that wanting to sell those resources will have to wait a long time before their number pops up.

 

 

 

IF the price update was hourly, the new lowest price would kick into gear allowing those wanting a quick sale to price the goods 1gp lower than the previous lowest price. Apparantly it is a 24hr price adjustment though, I wonder when the UK clock will tick over?

[Coinkydinky]

Probably at the same time, because Jagex is English...

[death666bl00ms]

 

1)Runescape is not real life, children play this game, children are impatient and greedy and have little to no understanding of action=reaction

 

 

Relevance = ?

 

 

2)The main reason things aren't selling is precisely because of supply and demand, there is [bleep] all demand for Calquat seeds(and possibly because of the way the system prioritizes sales/purchases).

 

 

The reason why there is too much supply and not enough demand is that the prices are too high and sellers can't lower them.

 

 

 

Why is that so difficult for some people to understand? I can only sell calquat seeds for 38k or whatever. If I could sell them for 29k or so, they'd have been sold hours ago. Is this really hard to understand? I don't get it.

 

 

Also don't use real world economic theories to describe the situation in the game, the only one that counts/transfers is supply and demand.

 

And that's the entire basis of my article, and why this exchange isn't nearly as good as it could have been - Jagex is mucking with supply and demand.

 

 

 

Time for another econ major to jump in...

 

 

 

Qeltar is absolutely right in using real world economics to analyze the game's economy since it is just that: an economy. The real world econ laws are fundamental. They transfer to any economy. Do not think that there is no tangible economy in runescape simply because its pixels. Behind every pixel is a person engaging in the economy.

 

 

 

Lol, and your first point is simply amusing. What does the age of consumers have to do with their spending, besides taste?

 

 

 

Edit: Just wanted to say something about your statement "have little to no understanding of action=reaction". Can you honestly say that the majority of people spending understand what their dollar is doing in the system? Can you honestly say that the average person understands economics at the level you are implying?

[icecube]

Correct me if I'm wrong but... WE DECIDE PRICES.

 

 

 

Supply and demand laws are still in play! As said so in the KB.

 

 

 

They set the prices for TODAY only, after that prices will readjust to how they were, or close enough.

 

 

 

I realize they're still taking control, but what's wrong with 5% change when prices return to normal? Even if it is only every 24 hours, how rapidly do prices really change?

 

 

 

[hide]

As you buy and sell, you'll probably notice that items have a tendency to change price. This is based on how much value players put on those items. If an item is hard to get and very useful, you'll probably see its price increase, as buyers are willing to pay more to make sure they get some, and sellers set the selling price higher than the average.

 

 

 

This is also true of common, less useful items, which may decrease in value.

 

 

 

This is called the Law of Supply and Demand.

 

 

 

* If an item is in high demand with low supply, the price will increase.

 

* If an item is in low demand with high supply, the price will decrease.

 

* If the demand for an item is matched by its supply, the price will remain fairly constant.

 

 

 

 

 

Because you can normally only bid 5% above or below the average price of an item, you'll find that there is little risk of an item's price plummeting or skyrocketing too rapidly. This makes it harder for players to manipulate prices and ensures that everyone gets a fair deal.

 

 

 

Prices are entirely set by players trading! There is no 'set value' that prices are based on, with the exception that a price will never rise above a shop's main stock price, or fall below the price a shop will pay for it. Note that shops will adjust their prices according to the Grand Exchange, so it is extraordinarily difficult to make a quick profit by buying from the shops and selling on the Grand Exchange and vice versa.

 

 

 

The prices items sell at are therefore not set by Jagex but by the players themselves! We are keen to keep a player-driven economy, so the prices are worked out using the supply and demand rules above. We will only intervene as a last resort, and only if we think price manipulation is going on, although the system has lots of safeguards to prevent that.

 

 

 

The market value of an item is automatically recalculated roughly once per day.

 

[/hide]

[cowmasta13]

People, this argument is a practice in futility.

 

 

 

Qeltar is convinced he is right, and nothing you say (right or wrong) is going to dissuade him from his beliefs. Let's just all leave in peace before a flame war breaks out.

[qeltar]

Correct me if I'm wrong but... WE DECIDE PRICES.

 

 

As long as they are within 5% of Jagex's made-up numbers. Gotcha. ;)

 

 

 

 

I realize they're still taking control, but what's wrong with 5% change when prices return to normal? Even if it is only every 24 hours, how rapidly do prices really change?

 

 

"Normal prices". Okay.

 

 

 

How about a wild pie?

 

 

 

How about a wild pie after a BTS announcing a new slayer monster?

 

 

 

How about a wild pie for someone who needs one for a quest?

 

 

 

You're being controlled.

[death666bl00ms]

People, this argument is a practice in futility.

 

 

 

Qeltar is convinced he is right, and nothing you say (right or wrong) is going to dissuade him from his beliefs. Let's just all leave in peace before a flame war breaks out.

 

 

 

Excuse me? Then what exactly is the point of making a post? He obviously wants feedback, and we are giving it to him. I personally agree with most, but not all of what Qeltar is saying. If you disagree with what he is saying, explain what you believe to be true. But don't make a post complaining when he disagrees with you. Qeltar has yet to make a point about someone else's comments without providing backup information which strengthen his points.

[Barihawk]

My only complaint with this article is that it's only a few hours of testing. You should have weeks at least before you make any solid claims.

[the_tallest1]

I find this to be a bit quick in publication considering the update hasn't been out even 12 hours yet. :? I went past the first paragraph on the assumption the article was proportional to the time we've had to dabble with the Exchange. I'm not knocking the quality of the article or saying the update's perfect but Jesus, give it a day to at least see how the pricing update works, not argue about its existence right away. How often do you have an operation and have no recovery period whatsoever, give it a week then test the waters.

[qeltar]

I tried to make clear in the article that this is not a complete analysis of the GE. And I also do say that I think it will likely improve as prices adjust.

 

 

 

It is more focused on my disappointment that Jagex created what could have been the ultimate tool for finally having a free, unhindered market in RuneScape, and then deliberately ruined it with ridiculously narrow trading ranges that make the majority of transactions impossible.

[the_tallest1]

I tried to make clear in the article that this is not a complete analysis of the GE. And I also do say that I think it will likely improve as prices adjust.

 

 

 

It is more focused on my disappointment that Jagex created what could have been the ultimate tool for finally having a free, unhindered market in RuneScape, and then deliberately ruined it with ridiculously narrow trading ranges that make the majority of transactions impossible.

 

 

 

We have two completely different directions we approached this update from. You were hoping for a free trading system. I was just hoping they wouldn't remove 1 to 1 trading with this update. I'm understandably happy it didn't happen, at least not yet. For you, disappointment. For me, relief. Not saying it's perfect, but it could have been far worse.

[qeltar]

I tried to make clear in the article that this is not a complete analysis of the GE. And I also do say that I think it will likely improve as prices adjust.

 

 

 

It is more focused on my disappointment that Jagex created what could have been the ultimate tool for finally having a free, unhindered market in RuneScape, and then deliberately ruined it with ridiculously narrow trading ranges that make the majority of transactions impossible.

 

 

 

We have two completely different directions we approached this update from. You were hoping for a free trading system. I was just hoping they wouldn't remove 1 to 1 trading with this update. I'm understandably happy it didn't happen, at least not yet. For you, disappointment. For me, relief. Not saying it's perfect, but it could have been far worse.

 

 

 

1 to 1 trade limits are coming. They will wait until the GE stabilizes and we finish their beta testing for them, and then they'll do it. It won't be removed entirely, but the days of being able to trade large volumes or $ values directly are coming to an end, probably soon.

 

 

 

Yes, that's just speculation, but Jagex's recent pattern of changes involving ham-handed control grabs strongly suggests it, IMO.

[berbatovsky]

 

1)Runescape is not real life, children play this game, children are impatient and greedy and have little to no understanding of action=reaction

 

 

Relevance = ?

 

 

2)The main reason things aren't selling is precisely because of supply and demand, there is [bleep] all demand for Calquat seeds(and possibly because of the way the system prioritizes sales/purchases).

 

 

The reason why there is too much supply and not enough demand is that the prices are too high and sellers can't lower them.

 

 

 

Why is that so difficult for some people to understand? I can only sell calquat seeds for 38k or whatever. If I could sell them for 29k or so, they'd have been sold hours ago. Is this really hard to understand? I don't get it.

 

 

Also don't use real world economic theories to describe the situation in the game, the only one that counts/transfers is supply and demand.

 

And that's the entire basis of my article, and why this exchange isn't nearly as good as it could have been - Jagex is mucking with supply and demand.

 

 

 

Time for another econ major to jump in...

 

 

 

Qeltar is absolutely right in using real world economics to analyze the game's economy since it is just that: an economy. The real world econ laws are fundamental. They transfer to any economy. Do not think that there is no tangible economy in runescape simply because its pixels. Behind every pixel is a person engaging in the economy.

 

 

 

Lol, and your first point is simply amusing. What does the age of consumers have to do with their spending, besides taste?

 

 

 

Edit: Just wanted to say something about your statement "have little to no understanding of action=reaction". Can you honestly say that the majority of people spending understand what their dollar is doing in the system? Can you honestly say that the average person understands economics at the level you are implying?

 

 

 

 

 

 

 

Right: My first point was: If you give people who are stupid a free market CENTRALIZED in one place they will demand ludicrous prices. In world 1/2 or on the forums you'd see the OCCASIONAL person trying to buy/sell things for ludicrous prices, I would bet my rather stylish hat that if they'd of done this with the GE (with the added anonymity) we'd of not only seen these idiots come out in force with their 'sell willow logs 57k each!!!'(enough to bring the GE to its knees ) but also the lovely merchants exploiting the [cabbage] out of the system posting false bids in attempts to manipulate prices (something they did anyway).

 

 

 

You are all happy to point out the good points of free trade but completely unwilling to accept that a bunch of children would almost certainly abuse it.

 

 

 

Don't say 'they could of anyway lol', because theres a big difference between a bunch of morons trying to sell things for stupidly high prices across 100 servers and across 700 banks and those all doing it at the GE.

 

 

 

Edit:death: your average consumer doesn't think about [cabbage] when they buy things, your average investor(a KEY difference between Rscape and the real world is that there is no stock market in Runescape)thinks about much more more.

 

 

 

Edit2: I will admit that some of the price ranges are downright wrong, but I don't see why you object to price ranges since they were in place anyway(in everything BUT writing). if I went into a bank and said 'buying prayer pots 6k' I would be told 'lol noob they r worth between 8-10k lol idiot'. Thats no different to what the GE does. I really don't get what the issue is, prices have always been inflexible in Runescape due to price guides and the natural rigidity price and demand creates.

 

I would not object to 10% max and min(but Qeltar your tone in this and the other topic was that Jagex putting price ranges in was a [bleep] move and I don't understand why).

 

 

 

 

 

Edit 3 : I've just thought up the best reason for having the price ranges. Without it people would have to look up prices to know what to bid/sell for. Not a big deal thats what they had to do anyway I hear you say. But thats the thing, the GE is an effort to streamline trade, it wouldn't do for their to be no indication of price because thats contrary to the ethos behind including it.

 

 

 

Edit 4:I'm just going to keep editing this post until it is the biggest post in the history of the forums, feel my POWERRRRRRRRRRR \ \ \.

[mario_sunny]

I tried to make clear in the article that this is not a complete analysis of the GE. And I also do say that I think it will likely improve as prices adjust.

 

 

 

It is more focused on my disappointment that Jagex created what could have been the ultimate tool for finally having a free, unhindered market in RuneScape, and then deliberately ruined it with ridiculously narrow trading ranges that make the majority of transactions impossible.

 

 

 

In my opinion, the 5% was necessary.

 

 

 

First, it is definately going to stop a lot of price manipulation. Some people in the past would make several threads with different titles, as to fool the public into thinking he was many different people, and either buy at ridiculously low prices or sell high. This was just one way people scammed, or fooled others into thinking a price had dramatically changed. It was not what I'd calling "merchanting" either; these people were taking advantage of people and using scams(which merchants don't) to manipulate an item(s).

 

 

 

Second, this limit will prevent something that may have been even more serious. Imagine several rich players get together and buy off all the santas, let's say, at low prices. Then, when they have a huge number of santas, and the buyers are desparate, they sell them all at once for huge prices. People would be forced to buy them; the rich get richer through scamming, and the poor lose millions of gp when santas start crashing.

 

 

 

Also, please respond to my statement earlier, thanks. :)

 

 

 

How do you know that jagex intended for this update to ruin merchants? I don't remember them announcing this, although you can correct me if I'm wrong.

 

 

 

Other than that, very good, detailed read. I love your articles qeltar and always try to them all the way through. :)

[JordanGM]

Another great article. I agree with you, again. =P~

[alcoolj]

I posted this elsewhere, but here is a better spot for it.

 

 

 

The only problem I see with GE is the ÃÆââââ¬Å¡Ã¬Ãâ¹Ãâ1st come, 1st servedÃÆââââ¬Å¡Ã¬Ã¢ââ¬Å¾Ã¢ selling basis. What is happening at present is those with 500k nats, flax, maples etc are holding up everyone elses sales of the same items.

 

 

 

If the price updates pick up on 1M nats going for the rock bottom price, then surely the price should be lowered sooner than a 24 hour window? This would give others a chance of selling at 1gp less than the previous rock bottom price.

 

 

 

My 2p, the rest of GE I really like. I have 5M more in my bank now than I did yesterday without the hassle of trawling through forums, delving into W2, and buying some much need supplies at the same time without getting ripped off.

 

 

 

So far, a 9/10 for me. Quicker price updates would see this an easy 9.5 :)