Issue of Hyperinflation

[beneficii]

Has inflation ever been a problem in SWG? It appears that something like that could be a problem, because money from what I heard is quite available, and it appears that they are constantly adding new ways for money to enter the economy. Does anyone observe pricing on the various planets in SWG? Anyway, pumping too much money into the economy can be bad, unless they have a way for at least a good bit of it to exit. Are NPC vendors still common? From what I understand about them, they take money out of the economy while adding more supplies into it, which can have a deflationary impact on it. I foresee massive problems if the MODs allow money to be too easy, while "retiring" the NPC vendors and other exits for money. This will cause hyperinflation to become a problem, which would make things so expensive that the new players, and the players who don't do so well financially, will feel its weight. There are three scenarios that would arise from this.

 

In the first scenario, of course, if the MODs cut the easy money--what they should have done in the first place!--, then this will end up causing moderate deflation, as demand for goods from merchants goes down due to the products being expensive. This though will cause many player merchants to go out of business, because it will cause selling not to be so profitable, sending prices skyhigh again, but this time because of a lack of supply not too much demand. Of course that will force the MODs to set up NPC vendors to bring supply back into the economy (and take that excess money out!) and finally satisfy demand, but if the NPCs aren't taken out quickly enough, it will cause massive deflation. The MODs would then have to put up the easy money. At that point though the player-run economy will pretty much have to start over.

 

In the second scenario, if the MODs instead choose to put up the NPC vendors to take back out that easy money rather than to stop its flow by artificially setting prices for goods low (which would make things more affordable for the n00bs and the not-do-so-wells), then the player vendors will be hit with massive deflationary pressures and be forced to go out of business (because they could not afford like the NPC vendors to sell goods for so cheap). This will have the effect of many players losing money, which would have to be remedied by making the easy money even easier. This would have the effect of making the economy completely dependent on the MODs to do anything. At that point it would have to start over.

 

Of course, this scenario is the last and probably the least likely. In this scenario, the MODs put up NPC vendors, while taking out the easy money part. In this scenario, you would be able to hear a great sucking sound as all of the money leaves the economy. This would pretty much kill the economy, and probably cause many to stop playing the game. This scenario, again, is too unlikely.

 

Essentially in this game, the MODs are like the Federal Reserve Bank. They have the power to manage the economy, but as can be seen in this, it would not be recommended. It may be tempting for the MODs to put up all sorts of missions and the like to appease the fighters, bounty hunters, explorers, etc. (putting easy money into the economy), while acquiescing to the demands of the merchants who would not want to have to compete with the NPCs for business. (Of course the MODs, as they said so themselves, want the supply-side of the economy to be player-run.) But my piece of advice to the MODs is this, Find a balance. If you want to put up easy money to help fighters and explorers, then great, but make sure you put up NPC vendors to let at least a good percentage of it (80%) back out. If you want to help out the merchants by removing their NPC competitors, then great, but make sure to stem the tide of monetary inflow by cutting the easy money. You can't have it both ways, at least not forever, and when it comes to the point that you can no longer have it (like when things become so expensive that only a very small number of players would be able to afford them), then prepare for a painful collapse of the SWG economy that would be the equivalent of the Great Depression of the 1930s.

 

Written by me!

 

(I know, This kinda went on. I didn't anticipate an article this long, and some of the words are used freely. Maybe I'll rewrite it later. Maybe. )

[darthfergie]

WHAT ABOUT THE LITTLE GUYS!?!?

I run harvesters out my ears and shell out tons of money...but do I charge guild members for my services? No...oh I will once I hit Master...but until then...no. I do missions to make up the money and I rarely walk around with more than 12k. Sure there are people that are very well entrenched in SWG who make millions of creds in a month...but me? No, and I don't expect to. Right now the group XP inflation has helped me beyond belief since I'm finally able to get the money I should have been getting for a group of 2 grauls and a human with Pistol IV. Where as people like commandos have a master in Marksman and get bonuses as they advance along their weapon chart. My weapon is creatures but I wasn't getting any faction missions over 1200 creds...now I'm able to get 4000-5000+ missions. Makes my life alot easier...and alot more enjoyable because I can finally take on some kind of challenge rather than one-shot-one-kill missions.

[Drakonis]

hm...

Interesting issue beneficii. Really clever.

It kinda brings up another related issue, which is the importance for all artisans out there to keep a decent price on their products as well, to help the litte-guys get into the market and keep the artisan profession profitable enough for people to choose it.

So all artisans readying this thread :

 

DONT UNDERPRICE YOUR PRODUCTS!!!

you`ll just shoot yourself in the foot.

 

here`s why.

 

lets say that u take a look at the selling market in the bazaar, and notice that everybody keeps charging 3cr per unit / resource.

U think.."hmmm. lots of competition out there. i think i will sell my stuff cheaper, to boost my economy" so you sell each unit for 2cr instead...

the initial result is that you`re definetily gonna make some quick cash on this, but you force the other sellers to follow up on your example. they have to reduce their prices as well to get their products sold, and around and around we go.....

what we end up here is extremely underpriced products, which eventually will hit you in the face as well.....

so due to your own ingeneious sales tactics you`ve just managed to reduce your own income dramatically, as well as ruined the market for all other artisans.

So pleeease dont underprice and stick to the "3cr per unit-rule", exept of course if you get a repeat customer who frequently buys LARGE amounts of stuff from you personally . In these cases we have to make exeptions and prices should be open for haggling

 

Play well and have fun

[beneficii]

darthfergie,

 

"WHAT ABOUT THE LITTLE GUYS!?!?

I run harvesters out my ears and shell out tons of money...but do I charge guild members for my services? No...oh I will once I hit Master...but until then...no. I do missions to make up the money and I rarely walk around with more than 12k. Sure there are people that are very well entrenched in SWG who make millions of creds in a month...but me? No, and I don't expect to. Right now the group XP inflation has helped me beyond belief since I'm finally able to get the money I should have been getting for a group of 2 grauls and a human with Pistol IV. Where as people like commandos have a master in Marksman and get bonuses as they advance along their weapon chart. My weapon is creatures but I wasn't getting any faction missions over 1200 creds...now I'm able to get 4000-5000+ missions. Makes my life alot easier...and alot more enjoyable because I can finally take on some kind of challenge rather than one-shot-one-kill missions."

 

Okay. If things become too expensive though then you would have to start charging for services.

 

Drakonis,

 

"It kinda brings up another related issue, which is the importance for all artisans out there to keep a decent price on their products as well, to help the litte-guys get into the market and keep the artisan profession profitable enough for people to choose it.

So all artisans readying this thread :

 

DONT UNDERPRICE YOUR PRODUCTS!!!

you`ll just shoot yourself in the foot.

 

here`s why.

 

lets say that u take a look at the selling market in the bazaar, and notice that everybody keeps charging 3cr per unit / resource.

U think.."hmmm. lots of competition out there. i think i will sell my stuff cheaper, to boost my economy" so you sell each unit for 2cr instead...

the initial result is that you`re definetily gonna make some quick cash on this, but you force the other sellers to follow up on your example. they have to reduce their prices as well to get their products sold, and around and around we go.....

what we end up here is extremely underpriced products, which eventually will hit you in the face as well.....

so due to your own ingeneious sales tactics you`ve just managed to reduce your own income dramatically, as well as ruined the market for all other artisans.

So pleeease dont underprice and stick to the "3cr per unit-rule", exept of course if you get a repeat customer who frequently buys LARGE amounts of stuff from you personally . In these cases we have to make exeptions and prices should be open for haggling"

 

But wouldn't that help the litte guy? It would cause prices for goods to be less. Just remember Walmart!

 

I think though that I know your concern. You're worried that the market would end up becoming an oligopoly or even a monopoly, if that chain of events happens. For one thing, I'm not sure it necessarily could happen, especially if massive inflation occurs. That would actually force businesses to up credits per unit (c/u) for goods. You say that it is 3c/u right now? Has it always been that way? Is that for player-made goods, or for common goods? I have researched this problem more thoroughly after making last night's post, and there appears to a phenomenon called mudflation that hits these games. It's where prices for low-end goods plummet (because they are so common) and prices for high-end goods skyrocket (because of high demand and rarity). I have yet to play SWG, but I am having it delivered to me as we speak. Do merchants ever adjust their prices?

 

Thanks.

[impala]

I think your concepts of not under pricing products is flawed. If an artisan wants to make a name for himself/herself, he/she has to get recognized. Unfortantly he/she cannot advertise (plug for a new profession), so he/she has only to options.

 

1. Have extremly better products than any one else

 

2. Have the cheapest products.

 

 

The problem with the first is advertisement. If I had a FSGW that shot at .5 sec and did 1000 points of damage, who would know? I play on Wanderhome, no one sits in the cantina bosting about a great weaponsmith on Corellia. I can't even find a good weaponsmith that has a varity of products (must are only for BH and Commandos).

 

Price is the only way your going to get customers right now. I may be wrong, but I am speaking as a player who goes to the Bazzar and not shops because of the price.

[beneficii]

"I think your concepts of not under pricing products is flawed. If an artisan wants to make a name for himself/herself, he/she has to get recognized. Unfortantly he/she cannot advertise (plug for a new profession), so he/she has only to options.

 

1. Have extremly better products than any one else

 

2. Have the cheapest products.

 

 

The problem with the first is advertisement. If I had a FSGW that shot at .5 sec and did 1000 points of damage, who would know? I play on Wanderhome, no one sits in the cantina bosting about a great weaponsmith on Corellia. I can't even find a good weaponsmith that has a varity of products (must are only for BH and Commandos).

 

Price is the only way your going to get customers right now. I may be wrong, but I am speaking as a player who goes to the Bazzar and not shops because of the price."

 

If you are competing with others, then you should try to make your price as low as you can. If you have better features than another person, then you should try to emphasize those, and use those to justify its expense. If you can't "find a good weaponsmith that has a variety of products," then perhaps you, or someone that you encourage, should open up such a shop. Obviously, with your sentiment, that's long overdue and you should make some real ccc with it.

 

Here's a general rule of proportion that follows with setting prices:

 

Let's say you have a million (1,000,000) units of something, say blasters (1e6 bl), and you want to sell them all. Let's say you set the unit price to ten credits (10 c) and now you get 10,000,000 people (1e7 p) willing to put up that many to buy one each. Well you only got a million to sell. In that case, you can try to maximize your profits by getting just a million wanting to buy, so you raise your price to respond to this burst of demand. There are 10 people wanting a blaster for every blaster that you have, so in a general rule to get it to be even, your price is a tenth of what it should be. Here we are:

 

? = 10c (1e7p/1e6bl)

 

? = 100c

 

So as a general rule:

 

The general proper price equals the proposed price times the quantity of demand per the quantity of supply.

 

Ppg = Pp * Wq / Sq

 

Yeah, I know, we're delving into math a bit, but we need to understand that.

[LordBigJ]

i dont see how artisans make anything i am a master ch/commando but my alt is a master merchant and what i do is i buy like 20 million in supplies and artisans give me stuff so cheap example PA halls 250k sometimes even 230k ( i stock atleast 20) and i sell for 10k over buying price and i buy flamethrowers for like 12k - 15k and sell for 17k tops sometimes i sell for 15k (thats not a crappy one eatehr usualy 440 - 850 4.5 spd and such) yeah i dont make much off them but i can buy them for like 2-3 k over cost for artisans and sell for 2-3 over that and what i get is 5k total markup from cost to make and i sell a ****load.. that makes an artisans job hard unless they sell to major distributers... like myself.