Guild Wars 2

Wazabi.1439:

Not exactly…what I’m saying is that equilibrium is at the lowest possible price, which is cost. But since we have an artificial floor price which is for now higher than cost, thus it is the equilibrium.

The intrinsic cost of an item is just the materials it is made of in the game. If you can salvage a trash item for 10c worth of mats, then the cost of the it is 10c (slightly different for crafted items). Off course, it the finished goods are in higher demand than the supply, the clearing price will be higher. But if the supply is greater or that there’s simply no demand, it will converge to 10c. No one will sell it below 10c because they are better off salvaging and sell the mats. No one will pay more than 10c for it because there is little to no demand for the trash loot, and plenty of supply and substitution.

When the currency inflates, mat price will inflate. on a 10% inflation, say mat price inflates by that much, then so will the equilibrium price of the trash loot….to 11c.

In our case where there’s a price floor, the only reason the price of the trash will increase above the vendor price is when the cost of mats it is salvageable is more than vendor price. Remember, this is not a price ceiling, it’s a price floor. Another way for trash loot to increase above vendor price is that if there are people in the market willing to pay more than that, and there’s an insufficient supply. Excess supply will result in undercutting because it is more beneficial to sell at above vendor price, which will then depress the price to equilibrium.

People will be willing to pay more than the 10c required to make such an item:
-because they themselves haven’t leveled a certain profession
-the service
-convenience
-and then basic supply/demand since the value of a good is how we choose to value it, and how many utils they would personally gain versus the cost.

If prices for things were equal to the cost in the real world, no one would make any money to put food on the table for their family cause they’d keep breaking even. I paid $8 for say a meal, it cost them far less to make it, but i’m willing to pay more than it cost because i don’t have to gather the ingredients and cook it myself, plus i’m saving time.

I’m saying mat prices won’t inflate with the currency because of the supply backlog that is having an item up indifinetly, and will be pegged to the vendor price, which is the problem because it should inflate with gold prices to keep even but it’s not going to.

and yes it is technically a price floor. I called/compared it to a ceiling though since it’s more like it’ll be stuck at that price mainly and it’s below what the real equilibrium should be, since price ceilings are below equilibrium usually and price floors are usually above. so even though it’s a price floor since theres no point at selling below vednor price, i compared it to a ceiling cause it acts more like one in nature.

I just sold about 40 different items in the last hour and made around 6 gold… in the last hour.

The TP works, but like most MMOs the majority of loot is trash. The issue is not with the TP or how it functions, it is an issue that most crafted and generated items are useless.

People is willing to pay more than 10c an item they can’t make or get themselves, correct. For the trouble or what-so-ever. Lets start with trash loot. You didn’t pay anything to make it. Any amount you can sell it for is pure profit for your time. Someone might want that item, and might be willing to pay more than 10c for that. But at the rate things are dropping, and all the alternatives available, that item’s value diminishes. Why would I want to pay you 15c for the item when an alternate item cost less but fulfills a similar function, or when I know that many other sellers are willing to sell it for less? This will happen with or without any control mechanism. Only factor that will increase the price is a reduced drop rate, or a reduced amount of crafters that can craft similar items. In GW2 anyone can loot a corpse, this generate a huge amount of loots. Take that away, you’ll have a market that you’re familiar with.

Now move on to crafted goods. They are competing with trash loots. Same reason why their prices are low unless it’s something very rare (not the rare definition of the game).

Money supply inflates the cost of all item. If you earn 100 now, and you are willing to spend 10% on an item. When you earn 1000, you’ll be willing to spend more, not necessarily 10%, but lets say it is for ease of comparison. You’ll be willing to pay more than 10 for the item now if there are competition. Money supply won’t inflate cost of items IF AND ONLY IF player population increases proportionately.

On the supply backlog…if there’s a backlog on trash loot cluttering the market even at +1c, isn’t that enough evidence that no one wants it? If there’s really a demand for it, it would had cleared the market and there won’t be a backlog at the first place.

In real world, the cost of making an item say, food, is more complicated. In game, you only need to spend time to get an item (drop), and there’s a vendor with unlimited supply of money to buy your item at a fix price. That’s risk free…you’re guarenteed to be able to sell at that price. In real world, it takes time, learning how to cook, overhead on cookware and utilities, risk of not able to sell (that means zero revenue), advertisement and such. You could end up with a negative profit, since there’s a risk, it commands a premium above cost else no one would do it. That’s not the case in game.

illgot.1056:

I just sold about 40 different items in the last hour and made around 6 gold… in the last hour.

The TP works, but like most MMOs the majority of loot is trash. The issue is not with the TP or how it functions, it is an issue that most crafted and generated items are useless.

BINGO. I personally never find the need to buy items from anyone…leveling happens to fast…it’s just not efficient to keep replacing your gear…only crafted staffs since I’m an artificer.

Wazabi.1439:

Money supply won’t inflate cost of items IF AND ONLY IF player population increases proportionately.

Tell that to the Germans.

If money supply doubles, that money’s worth becomes halved. If a loaf of bread cost $1, then after the money supply doubled, it would now cost $2 because it would take twice as much to pay for it since the money value has been halved. Essentially you are still paying the same amount of money though, so it’s not making much of a difference. Another example would be how much goods cost back in the 50’s as compared to now.

The prices of goods need to match the rate of inflation. Otherwise, if the prices stays pegged to the vendor price, then in the future as money supply increases people will have tons and tons of gold, but everything will be the cheap cost of the vendor price. This is why the market price equilibrium should be determined by what a products value is currently worth in the market. If you can place things up in the TP forever, as it clutters those products prices will forever be stuck in the past, then if you want to post up an item you’ll have to compete with the prices of the past which are stuck in the future and thus you will put up that item for sale at the price that it is stuck at.

i say this because the player population will not increase proportionally. it will be a fast increase when a game releases, and will then flatten out from there.

It is good the way it is, and could be made better. I dont mind the 1 copper less garbage bin mechanism. Its simply amazing cause as Im getting farming supplies and I get something unexpected like a gem, I can pawn out my sword for 1 copper less and continue farming rather than having to head to a vendor. Or events that drop loads of items, I can just send it to the blt. What I dislike is the junk crap that drops from kills that cant be used and sold at towns for few coppers. Perhaps its items that will eventually be craft-able but currently is crap and waste space because who really individually picks up items from a drop in a event like a fight. Its press g and get all.

Selling for 1 copper less and someone drops it down 2 coppers, newer players end up getting cheaper better items. I dont mind that. Who really counts their coppers? With each level doing that then it would lead to the level Im at also getting cheaper master items. We help each other a little bit.

Ziggy.7319:

Wazabi.1439:

Money supply won’t inflate cost of items IF AND ONLY IF player population increases proportionately.

Tell that to the Germans.

If money supply doubles, that money’s worth becomes halved. If a loaf of bread cost $1, then after the money supply doubled, it would now cost $2 because it would take twice as much to pay for it since the money value has been halved. Essentially you are still paying the same amount of money though, so it’s not making much of a difference. Another example would be how much goods cost back in the 50’s as compared to now.

The prices of goods need to match the rate of inflation. Otherwise, if the prices stays pegged to the vendor price, then in the future as money supply increases people will have tons and tons of gold, but everything will be the cheap cost of the vendor price. This is why the market price equilibrium should be determined by what a products value is currently worth in the market. If you can place things up in the TP forever, as it clutters those products prices will forever be stuck in the past, then if you want to post up an item you’ll have to compete with the prices of the past which are stuck in the future and thus you will put up that item for sale at the price that it is stuck at.

i say this because the player population will not increase proportionally. it will be a fast increase when a game releases, and will then flatten out from there.

Zig, you need to think deeper. Things you read from news paper or some other sources overly simplifies a lot of things, that might be why you’re getting incomplete idea. Many of the things you say is not unfounded or wrong…just incomplete. You often look at how 1 variable (Y) changes by changing another variable (X1) assuming the other variables (X2) affecting it stays constant. In that sense, you’re correct…but often changes in X1 affects X2 as well, and you didn’t take that into consideration.

Inflation is a complex mechanism, people spend years just to learn and understand all the factors. If money increase by 10%, but population increase by 10%, production increases as well. Assuming production increases proportionately by 10% in a simple economy, then there won’t be an inflation.

The cost of an item is not pegged to anything. If an item is pegged at +1c, and cluttering, it means the item is not selling fast enough…that means not enough people demands it even at +1c. If there isn’t any vendor price (vendor don’t buy it), it would go even lower. Using whatever mechanism to remove them from the market or even encourage them to sell it at vendor (to remove the clutter) won’t change things much. If anyone is willing to buy the item above vendor price, then they are going to realize it and start selling in the TP again to push the price down.

I’m gonna have to ask you to trust me on this, this is what I do. If you’re still in college and have access to an economics professor, run it through with him, I believe he can provide with a better explanation in person.

Wazabi.1439:

Zig, you need to think deeper. Things you read from news paper or some other sources overly simplifies a lot of things

those “things” were real life effects of inflation, unless you’re trying to insinuate they never happen.

that might be why you’re getting incomplete idea. Many of the things you say is not unfounded or wrong…just incomplete. You often look at how 1 variable (Y) changes by changing another variable (X1) assuming the other variables (X2) affecting it stays constant. In that sense, you’re correct…but often changes in X1 affects X2 as well, and you didn’t take that into consideration.

I’m assuming you’re talking about the increase in population. This is true if and only if the population keeps increasing and at the proper rate to make up for inflation. After a game’s release the population of new people joining increases, but over time that increase begins to flatten as the people who would’ve bought they game have already. even with people joining it won’t stop inflation as it’s inevitable, you can slow it down, but not stop it.

Inflation is a complex mechanism, people spend years just to learn and understand all the factors. If money increase by 10%, but population increase by 10%, production increases as well. Assuming production increases proportionately by 10% in a simple economy, then there won’t be an inflation.

you’re forgetting that those new people will also become contributing factors to inflation as well. the new people join will be selling their trash drops in the TP at the current market price to other players than from the past when prices were lower. but more gold will still be constantly generated through drops.

The cost of an item is not pegged to anything. If an item is pegged at +1c, and cluttering, it means the item is not selling fast enough…that means not enough people demands it even at +1c. If there isn’t any vendor price (vendor don’t buy it), it would go even lower. Using whatever mechanism to remove them from the market or even encourage them to sell it at vendor (to remove the clutter) won’t change things much. If anyone is willing to buy the item above vendor price, then they are going to realize it and start selling in the TP again to push the price down.

the item is not selling enough not because the demand isn’t great enough, but because supply is too great (though it’s essentially the same thing but reworded, I’m wording it this way because the supply is mainly where the issue stems from). the cost of an item begins to be pegged to the vendor price as the supply becomes way too much, driving prices down. you are right though in that if there was no vendor, it would go even lower, luckily the vendor does set a price floor (but it’s below the equilibrium), since prices keep dropping but there’s no point in selling below the vendor price, prices become equal to vendor or +1c above the vendor. If items are able to stay up forever and clog the market, prices will continue to fall, that’s the problem.

I’m gonna have to ask you to trust me on this, this is what I do. If you’re still in college and have access to an economics professor, run it through with him, I believe he can provide with a better explanation in person.

Trying to attack credibility here for a game’s economic system which is much simpler than real world isn’t going to help you here so long as I’m providing a proper analysis. Nice try though.

Lets try to bring our arguments back to the point without deviating too much.

You’re assuming that if the clog is cleared via timed posting, people that can’t sell will not repost to TP (coz of listing fee), and would be more profitable to sell to vendor, hence they will sell to vendor, thus reducing supply? Yes you are correct. The reduced supply will increase the price of the item (magnitude of increase is debatable depending on how far apart are the deviation on supply and demand, and elasticity)? You are correct. This is what will happen. What about after that?

Will these people (after the clutter is cleared) still sell at vendor when they realize they can sell for a higher profit at TP now that the price has increased? If that’s a yes, then what will happen to the price? As long as the drop rate/easyness of getting these items in the game remains the same, nothing changes. The clutter could be cleared, but the rate at which the item is generated is still greater than the rate the demand is increasing (if at all). That doesn’t change anything. You’ve cleared the stock, but not the rate at which the item is being supplied to the world, which is the root of the problem.

Look at the recent butter market…Price increase due to a sudden demand surge from the new recipe. The only way for a price of an item to increase (not factoring inflation) is for supply source to decrease, or demand to increase. Tweaking of mechanism is only going to create temporary shocks/adjustments in the short-run.

A game who’s economy have 10000 players and one who has 2 million player is very very different. GW2 is simpler than the real world, but probably more complex than you think.

There needs to be an expiration time limit on anything placed on the Trading Post since it is definitely an issue with folks tossing things on there just to empty their bags. The glut would disappear considerably if there was an expiration time limit on those items.

Why so much “trash” on the TP? This is really odd because there are several ways of disposing of “trash” items (except unsellable trophy items not used) and that is to scavenge it. I scavenge almost everything except Blues and Greens, which I do sell on the Trading Post if I can’t use them.

Once I got into the rhythm of just vending everything except high end items, and scavenging the rest for materials, my bags are rarely full (and I have 8 slot bags). But I think that having an expiration time on items posted for sale is definitely a must.

Let me just ask you this Wazabi,

It seems you want the prices to become equal to the vendor price. explain to me why that is a good thing. As of right now, every item i see listed on the TP is equal or 1c above the vendor price. even worse, those people are losing money from the listing fee as opposed to just vendoring them item instead. If this trend (of everything being equal to the vendor price) continues, how do you think it would effect the future a year from now, when more gold exists floating around the market?

What I use the TP for..
Selling Gathering material’s.. that’s it..
all trash I vendor at a town merchant or any merchant.
And I typically wait a long time to vendor my Gather mats, so I press deposit gathering material’s alot or what it’s called..

One pretty simple fix would be to make it ACCESSABLE.
Yeah, you can buy and sell anywhere… but you have to run all over Hell’s Hundred Acres trying to find a trading post to pick items up.

Pretty crap poor approach to a player market, that.

@Ziggy
I did not want the price to become anything. I’m merely stating how the price will evolve base on economic theory and fundamentals. You argued that clearing the clutter will make the price higher, I’m clarifying that it will not. If you think I’m wrong, justify it by providing an alternative explanation to what I’ve said on the previous post. Argue on my point…not my intentions….back it with economics theory, and show it with an example.

You earn lower profit selling +1c, you don’t lose money. From that transaction, 15% of the money gets sinked. I can sell all my trash on TP at +1c and assuming it all sells, my wealth will still increase…just not as much as those that sells it to vendor. If it doesn’t sell, they lose the 5% listing fee…but the item can still be taken down to be vendored. How would this affect the future? Weather the clutter clears or not does not determine the supply and demand in the long run…only the actual drop rate and usefulness of the item does.

Wazabi.1439:

I did not want the price to become anything. I’m merely stating how the price will evolve base on economic theory and fundamentals. You argued that clearing the clutter will make the price higher, I’m clarifying that it will not. If you think I’m wrong, justify it by providing an alternative explanation to what I’ve said on the previous post. Argue on my point…not my intentions….back it with economics theory, and show it with an example.

If say posting something up expires after 3 days instead of being able to leave something up there forever it forces people to stay on track with their own inventories. If an item is allowed to stay up forever, people can and will leave it there out of laziness, forgetfulness, or not wanting to pay another listing. If it expires after a while and gets sent back to you, if you want to repost it you’ll have to pay another listing fee and consider a change in price to list it for which would keep the market competitive and discourage a lot of the clutter when faced with paying another listing fee.

As such a lot of the space is now cleaned out, this means less supply of said item up on the TP, which means supply will shift left on the graph and therefore raising the price.

Wazabi.1439:

You earn lower profit selling +1c, you don’t lose money. From that transaction, 15% of the money gets sinked. I can sell all my trash on TP at +1c and assuming it all sells, my wealth will still increase…just not as much as those that sells it to vendor. If it doesn’t sell, they lose the 5% listing fee…but the item can still be taken down to be vendored.

of course your wealth will still increase from a sale, even if you only get 1 copper for it .

you even said yourself in this quote that you would get more money from selling to a vendor instead of a player due to the TP’s money sink. if an item sold for 100 copper to the vendor and the TP, you’d want to sell to the vendor instead because you’d get your 100 copper. in the TP you’ll recieve less from listing price/tax

How would this affect the future? Weather the clutter clears or not does not determine the supply and demand in the long run…only the actual drop rate and usefulness of the item does.

Supply is the amount of product in the market that people are willing to sell. Just because an item exists does not mean it is necessarily a part of the market supply, unless that player has a willingness to sell that specific item. As such, in order to determine the “market supply” of which people are willing to sell to others and not keep for themselves which would not be part of the market, the best and universal way is to look at the TP since that is when an item becomes visible to the rest of the population and becomes added to markets supply.

If all of the clutter is reduced from an expiration time, you are correct in that the item doesn’t go away. it does indeed still exist. However, that item may or may not go back and be reposted on the TP. If it’s repost, it becomes part of the supply again, if not then it is not because that player has decided to withdraw it from the market for now and is not willing to sell.

“Because there’s a feature and automatically selected ‘match the lowest seller’, the prices stay low even for non-trash items”

Wait, WHY IS THIS A BAD THING???? I like to buy. I am NOT spending 20 gold for an undead mini pet chicken. I will wait until people undercut it to the point that I think is a reasonable price, and THEN I will buy it. Abyss dye is almost 5 gold. I refuse to buy it until it gets down to around 1-2 gold.

Who cares if people list up trash items? There’s a search tool for a reason you know. It’s not keeping me from finding what I am searching for, and it shouldn’t be keeping others from finding what they are looking for, so why is this an issue?

A 7 day expiration? NO! I like selling items too. If I am paying 15% of my hard earned gold to list an item, why should it expire, only to list it again? It’s just a waste of money to constantly keep putting the item up for sale. In other games, I usually end up vendoring things that people want because it’s too much of a hassle to keep re posting everything on the trade broker.

As such a lot of the space is now cleaned out, this means less supply of said item up on the TP, which means supply will shift left on the graph and therefore raising the price.

Correct. This here is the key. We both agree on this point. What we differ is that, you believe it will stay there, where I say it will not. Clearing the clutter of existing stock is a shock to the supply, that’s why the supply curve shifts left. Now, 2 thing here I like to point out:
1. Demand curve for trash item is very flat…and supply curve for trash item is steep. Draw it out, and shift supply left. Price doesn’t goes up very much did it?
2. Introducing the dynamics of economics. We’ve only cleared the stock, but not the source of the supply, which is drop. Granted, supply is reduced, people start selling to vendor to clear the clutter. Now, price raise. People will react to this price raise as well. A rational being will sell it through TP now because it is more than vendor…and since the supply rate (how easy the game spawns trash loot) is still the same, and because demand curve is very flat (hence insensitive to price change, low elasticity), price will get push down again, towards the equilibrium price (mat cost price or vendor, whichever higher).

Thus, in the Short Run, you are correct…but when you look at it on the Long Run, it doesn’t change.

Wazabi.1439:

1. Demand curve for trash item is very flat…and supply curve for trash item is steep. Draw it out, and shift supply left. Price doesn’t goes up very much did it?
2. Introducing the dynamics of economics. We’ve only cleared the stock, but not the source of the supply, which is drop. Granted, supply is reduced, people start selling to vendor to clear the clutter. Now, price raise. People will react to this price raise as well. A rational being will sell it through TP now because it is more than vendor…and since the supply rate (how easy the game spawns trash loot) is still the same, and because demand curve is very flat (hence insensitive to price change, low elasticity), price will get push down again, towards the equilibrium price (mat cost price or vendor, whichever higher).

Thus, in the Short Run, you are correct…but when you look at it on the Long Run, it doesn’t change.

Those slopes (as of now) are indeed inelastic. but as the clutter is cleared out, it would also be changing their elasticity when getting rid of the saturation of supply.
This is because the market is saturated, at this point the market is no longer generating demand. This can be due to a decreased need, due to competition, or any other factors. In this case it’s the competition from the forgotten items causing the saturation. One of the effects of saturation is altering the elasticity of supply, get rid of the saturation and the elasticity goes back to normal. Remember, there is a difference between a lot of supply and a saturated supply, you seem to think it’s just a lot in which case you’d be right.

Honestly though, I think we’re both on the right track, and there really is no way to tell how effective or ineffective it would be to clear out the clutter by adding an expiration date until it happens.

Though I can say this, it would definitely make it easier for those who’s prices end up being in the middle/higher due to undercutters and people who dont care what price they sell for, since there is less people in line the line will catch up to them faster and they’ll actually be able to finally sell some things.

You may not agree on my methods to get the price to be at least higher than the vendor price and that’s fine with me. But, do you at least agree that it should be higher than the vendor price? (due to future inflation while the prices stay stuck at the vendor price forever.) As of right now, there is no logical reason to sell on the TP while prices are equal to the vendor price as you have to pay a listing fee and tax and wait for the sell, when you don’t need to pay any of that and you get your money instantly at a vendor (yet people still are selling them for less money up there, i guess for convenience while leveling).

The TP works fine as it is. I would hate to have to give up selling from anywhere or having a time limit. Those I some of the things I love about GW2.

If there are items in the TP that are in excess supply – SO WHAT? That just happens to be the equilibrium given the drop rate and demand for that item. Anet should be the one fixing that by adjusting drop rate.

There is a filter and search for you to look for the items you want.

I still say you should not be able to utilize the trading post without being at a trading post agent. Whether that is in a town or with the gem purchased express.

Would reduce the use of the trading post as a low cost convenience bank, encourage perhaps some more gem shop usage, and give a reason to that gem shop item.

Kumu Honua.2751:

I still say you should not be able to utilize the trading post without being at a trading post agent. Whether that is in a town or with the gem purchased express.

Would reduce the use of the trading post as a low cost convenience bank, encourage perhaps some more gem shop usage, and give a reason to that gem shop item.

this would also be quite helpful to reduce the supply a bit.

@Ziggy
We’re making progress here. I’m not so much interested in the changes in mechanism. Rather, I’m more interested in the underlying theory. I’ve spoken to a fellow classmate earlier about our debate, and he pointed out a good point that I’ve overlooked: The way the curves shifts.

Supply and Demand is a function of price. Through the function, you draw the curve. However, price is an endogenous factor…thus changes in price doesn’t shift the curve…instead the point just moves along the curve. Can’t believe I overlooked this…would had made explanations easier. Now, you were talking about stock. Changes in stock changes the price…reducing stock raises the price…raising the price result in a point that moves along the demand curve, and another point that moves along the supply curve to the now higher price. At this higher price, the demanded quantity reduces, but supply quantity increases, and the 2 points will eventually converges to the intersect of the curve, which is equilibrium.

Question now is what determines the equilibrium? That depends on what will cause the curve to shift. These are exogenous factors. Introduction of a new recipe that requires the item will shift the demand curve to the right, more demand at any given price. Reducing the drop rate will shift the supply curve to the left.

Note that there is a small difference in MMO and real world. In real world, supply will adjust accordingly to the price (hence moving along the supply line)…but in MMO…it is semi-independent of the price…in that weather an item sells for 10 or 100, the supply is still the same because the loot generation doesn’t change. Only changes is if price is low, more will be vendor-ed or salvaged (depending on how low)…which moves the point along the supply curve.

Can you understand the dynamics I’ve described? That is the reason no changes whatsoever will affect the price unless the changes are exogenous factors.

*a small caveat to that: removing transaction price theoretically reduces the cost of selling, hence we should see prices being 15% cheaper…but it introduces a lot of variation to the market, not necessarily a good thing
*I like how this is going…it is a good mental exercise to test my own understanding of economics theory.

Wazabi.1439:

@Ziggy
We’re making progress here. I’m not so much interested in the changes in mechanism. Rather, I’m more interested in the underlying theory. I’ve spoken to a fellow classmate earlier about our debate, and he pointed out a good point that I’ve overlooked: The way the curves shifts.

Supply and Demand is a function of price. Through the function, you draw the curve. However, price is an endogenous factor…thus changes in price doesn’t shift the curve…instead the point just moves along the curve. Can’t believe I overlooked this…would had made explanations easier. Now, you were talking about stock. Changes in stock changes the price…reducing stock raises the price…raising the price result in a point that moves along the demand curve, and another point that moves along the supply curve to the now higher price. At this higher price, the demanded quantity reduces, but supply quantity increases, and the 2 points will eventually converges to the intersect of the curve, which is equilibrium.

Question now is what determines the equilibrium? That depends on what will cause the curve to shift. These are exogenous factors. Introduction of a new recipe that requires the item will shift the demand curve to the right, more demand at any given price. Reducing the drop rate will shift the supply curve to the left.

Note that there is a small difference in MMO and real world. In real world, supply will adjust accordingly to the price (hence moving along the supply line)…but in MMO…it is semi-independent of the price…in that weather an item sells for 10 or 100, the supply is still the same because the loot generation doesn’t change. Only changes is if price is low, more will be vendor-ed or salvaged (depending on how low)…which moves the point along the supply curve.

Can you understand the dynamics I’ve described? That is the reason no changes whatsoever will affect the price unless the changes are exogenous factors.

*a small caveat to that: removing transaction price theoretically reduces the cost of selling, hence we should see prices being 15% cheaper…but it introduces a lot of variation to the market, not necessarily a good thing
*I like how this is going…it is a good mental exercise to test my own understanding of economics theory.

I follow you completely.

I just wish there’s something we can do so the price wasn’t equal to the vendor price. So far every item i’ve checked on the TP is equal to vendor price, thus i end up vendoring the item instead because i’d gain more money selling to an npc rather than to trade it with players at the cost of a listing fee and tax.

Any artificially designed market/mechanism will have its constrains and imperfection. Just need to find the most efficient way to make the most out of it…that’s the key to everything.

Wazabi.1439:

Any artificially designed market/mechanism will have its constrains and imperfection. Just need to find the most efficient way to make the most out of it…that’s the key to everything.

that’s the key……..

…….to my heart!

(sorry, I had to)

I love the current trading system.

I love the current trading system.

if there was one : , (

Simply solution is to have tell the players what there profit will be for the price they wish to list it at.

EXAMPLE:

item to vendor gives you 25 copper
someone lists if for 26 copper
the game now tells them they will make a -3 copper profit
26 × 15% = 3.9 (4)
26-4=22
25-22=3

How it should appear if done correctly

25 copper to vendor
player lists for 50 copper

50 × 15% = 7.5 (8)
50-8 = 42
42-25 = 17 copper profit

Also make a removal fee that would really hurt the players pocket book for those that are using it as a trash bin

if an item is listed for 20 days. have it removed from the TP for the vendor cost of the item.

EXAMPLE:

25 copper to vendor
player lists for 26 copper
after 20 days have the 25 copper removed from the players bank/backpack where ever they have their money.

So instead of getting 25 copper from the vendor they will loss the 25 copper for every item that had in the TP for 20 days. (give them a warning saying they are getting close to 20 days on items they have listed in the TP.)

You are just used to TP like in other games (I will say WoW, because that is what you are aiming for).
Trash in BL? Why on earth is that bothering you? It is not like you see every single little item on there and you have to scroll thru every one of it to find what you want. You have “Searh” option, you have “Filters”, etc etc.

All of you must see this is not an MMO like any other, it is different, everything is different. Ppl will soon complain that there are no quest givers and stuff like that.

Wazabi.1439:

illgot.1056:

I just sold about 40 different items in the last hour and made around 6 gold… in the last hour.

The TP works, but like most MMOs the majority of loot is trash. The issue is not with the TP or how it functions, it is an issue that most crafted and generated items are useless.

BINGO. I personally never find the need to buy items from anyone…leveling happens to fast…it’s just not efficient to keep replacing your gear…only crafted staffs since I’m an artificer.

not everyone levels quickly. My highest toon is 26 and I have been playing since launch. I wish people would not assume everyone levels “quickly”

all you do is make a kitten outta U and me kitten u me)

I actually need the TP to start to work correctly. I am 75 to 85% behind on the amount of cash I planned I should have made by now. And yes I actually mapped out on excel how much money I should be bringing in a day via game play, selling to vendors and the TP. All based on my BWE experience with the entire game system, including a TP working like it did during the BWEs.

First due to the TP being down for the first week and a half to now items being massively under prices.

I am just now getting to drops that are level 20s due to just now getting my toons to the 20s. The way the system is now has hurt my game pocket book very much.

Masively under prices? Fine crafting materials for low lvls are 1 silver each, and you need a ton of them. Orichalcum ore and ancient wood are are sold for 1 silver A PIECE.

I haven’t found 1 single item that is under priced so far. Well, maybe it is underpriced for you, because you want to sell it for 200% more, but it isn’t how it works.

@Wazabi:

I was thinking about the effects of moving down the supply curve, changing the quantity, and thus seeing how it changes the demand price at that quantity.

It will end up raising the price above the vendor price (by how much though is arbitrary/subjective though, which is what we’ve been debating about). However, it causes a deadweight loss, this is because of the clutter which would’ve been up for sale, isn’t, so the graph is like “where’d some of my supplies go?” so it’s not really a bad thing because the unnatural equilibrium price was caused by that clutter in the first place.

So it will definitely go up. by how much though is another story where we’d need to gather actual numbers which maybe i shall do one day when i’m bored.

I’m thinking that the difference in price goes up by the amount of the tax, since when when you move down the supply curve and up the demand curve, not only are you causing a dead weight loss, but you get the rectangular box which is the tax revenue (in this case the game’s listing/tax fee to repost an item again). so the difference in price is the amount of tax. So what I’m thinking is that if an expiration date were placed, the rise in price will be equal to the percent of the tax for item X. However i’m not sure if it would be equal to the change from the tax or half of the tax due to the price floor if it cuts off the lower half or not. however, i think time of expiration might also be a factor as well, as opposed to 1 day, 3 days, a week, or what it is now which is forever.

http://cfacuecards.files.wordpress.com/2012/06/deadweightlossduetorentceiling.jpg
for a visual, i’m talking about the pink rectangle and the vertical difference in price if my words weren’t making enough sense.

So if an item went for 1g (or 100 s), then 15% tax would mean price would go up to 115 s or 107.5 s, if it’s full tax or half tax (due to price floor/ceiling since the vendor price kind of acts as both right now). though i’m not sure how to incorporate time in this case which i’m sure it is a factor. But I think i’m onto something, maybe you’ll be able to figure it out?

CarP.3401:

You are just used to TP like in other games (I will say WoW, because that is what you are aiming for).
Trash in BL? Why on earth is that bothering you? It is not like you see every single little item on there and you have to scroll thru every one of it to find what you want. You have “Searh” option, you have “Filters”, etc etc.

All of you must see this is not an MMO like any other, it is different, everything is different. Ppl will soon complain that there are no quest givers and stuff like that.

It’s not that all of that extra trash is visually unappealing. it’s that it’s literally warping the quantity supplied and the equilibrium price.

Simply solution is to have tell the players what there profit will be for the price they wish to list it at.

EXAMPLE:

item to vendor gives you 25 copper
someone lists if for 26 copper
the game now tells them they will make a -3 copper profit
26 × 15% = 3.9 (4)
26-4=22
25-22=3

How it should appear if done correctly

25 copper to vendor
player lists for 50 copper

50 × 15% = 7.5 (8)
50-8 = 42
42-25 = 17 copper profit

Also make a removal fee that would really hurt the players pocket book for those that are using it as a trash bin

if an item is listed for 20 days. have it removed from the TP for the vendor cost of the item.

EXAMPLE:

25 copper to vendor
player lists for 26 copper
after 20 days have the 25 copper removed from the players bank/backpack where ever they have their money.

So instead of getting 25 copper from the vendor they will loss the 25 copper for every item that had in the TP for 20 days. (give them a warning saying they are getting close to 20 days on items they have listed in the TP.)

this is pretty much what i’m trying to strive for. because right now, anyone selling on the TP is actually losing money. (at least for most listed prices, there might be a few items i havent seen that are above vendor price)

While the trading post is far from perfect, I do believe some things to be worth keeping. The auto send to lowest price for the item, IMHO, stops the rip off merchants from overinflating the worth of some item they have decided to craft irrespective of its actual worth.

I do agree with the original idea that allowing items to be posted for sale from anywhere is bad, as has been said it appears to make it a way of keeping your bags free of junk, although it would be nice to be able to pick up from anywhere, rather than needing to wait till in town to do so. What is the point, surely it wouldbe better to get that stuff gone ASAP?

These bloody economic thing is always better illustrated with a graph. Since you’ve posted the deadweight picture, lets just use that. For now, ignore the deadweight and price ceiling…I’ll get on to that later.

Lets say the intersection is the equilibrium price (Call it point E), which in this case happens to be the vendor price (or vendor +1), @ 20. In this equilibrium, demand is 72. Say some stock disappears for some reason…the supply of the item in the market is reduced, and hence the demand should rise, and so should the price. But since as the price rises, demand reduces as well (that’s why price is endogeneous), then imagine a point at E that “jumps” to point A on the demand curve where the price=24, qty demand=44. The supply curve is also affected. Rise in price also increases the amount that people wants to sell (since it’s above vendor, they will sell it to the market, that’s where the increase comes from), so another point jumps from E to B on supply curve where price = 24, supply qty = 100. All this happens the instance the stock disappears.

Now push the play button. We have a situation where supply is higher than demand…sellers will undercut each other to get their item to sell first…given time, both point A and B will move towards point E at equilibrium. The higher than vendor price will not persist. The only way for it to be at higher vendor price is a shift of either curve…through new recipes or changes in drop probability.

Now, on to deadweight. You’ve misinterpreted the graph. The graph shows a price ceiling…we have a price floor. If the price floor is below point E, there’s no difference since it’s below equilibrium price…so it’s effect won’t kick in. Now lets examine if it is above equilibrium.

Imagine now that the equilibrium point E is no longer the vendor price..but rather it is the real equilibrium price of an item. Draw a price floor above point E, at the price of 21, the vendor price. Because of the price floor above equilibrium price, the demand is reduced. Also, consumer surplus is also not as much as without the price floor. There’s also a deadweight loss similar to your graph.

Tax should not be interpreted in the context of consumer/producer surplus as the cost of bearing the tax is actually split between buyer and seller (too mathematical to be discussed here), where as a price ceiling/floor is absolute. But suffice to say, tax will reduce the utility (an abstract of happiness if you would) of both parties. However, tax also reduces variation from speculation, which will increase the utility of both parties…so if the net effect is positive, then tax do more good than harm.

This game is still really new, you should give the trading post a good bit of time for inflation to kick in in my opinion. I don’t think asking for a major change like this is warranted just yet. I think we’ll see major change between now and a couple months from now.

Would using the price of gems be a useful relative indicator of how much gold is currently in the system which, in turn, would indicate the possible growth of coming inflation?

I’m not here to discuss economics.

Facts to why the TP is a piece of crap atm:

1 – Everyone clogs it with every piece of kitten they pick up even if that means losing money (which means it’s being used to fulfill a different purposed than the original or at least goes against your “economic” standards)

2 – That causes TP lag cause the database access gets heavier loads.

3 – People undercut on almost every item in the TP , valuable or not. And they undercut to levels that it isn’t worth selling it there anymore (unless you don’t have problems farming like a madman so you can afford to cheapen out your items and still make good profits).

$ – Of course some high end items escape this situation cause they´re end game items and people watch them as permanent instead of temporary and also because they dont ’t have the same supply.

What I want most of all is that they stop people from lagging the TP.

This post seems to have been started by a gold farmer who is frustrated they cant gut the trading system and has turned into a pretty good troll.

Agenteusa.6380:

I’m not here to discuss economics.

Facts to why the TP is a piece of crap atm:

1 – Everyone clogs it with every piece of kitten they pick up even if that means losing money (which means it’s being used to fulfill a different purposed than the original or at least goes against your “economic” standards)

2 – That causes TP lag cause the database access gets heavier loads.

3 – People undercut on almost every item in the TP , valuable or not. And they undercut to levels that it isn’t worth selling it there anymore (unless you don’t have problems farming like a madman so you can afford to cheapen out your items and still make good profits).

$ – Of course some high end items escape this situation cause they´re end game items and people watch them as permanent instead of temporary and also because they dont ’t have the same supply.

What I want most of all is that they stop people from lagging the TP.

Don’t see any factual information here.

Being able to sell from anywhere is one of my favorite features in this game. I don’t want it taken away.

Also, even if we couldn’t, we can deposit collectibles from anywhere. It just means instead of posting those venom sacs 2 at a time, I wait til I’m in town then sell them 20 at a time. Doesn’t affect anything, just adds extra inconvenience for no payoff.

I would venture to say that I abuse the current TP a bit in a couple ways. None of which I would say were intended in its creation. MIght be helpful in gauging it’s status.

1. Buying greens at 1 c above vendor sell price and then being able to sell a full set of equips at a 10 c loss to vendor everytime I level to the next tier (this is lolzy, also I never repair because I can always just replace equips for a 1 c loss).

2. Buying base mats on the TP and then being able to refine and sell for more despite the 15% fee. (this is slowly becoming less viable as the market stabilizes though).

3. Speculation using the offer feature. This usually allows you to dodge the 15% fee because the offer is almost always at least 15% below the instant price for commonly traded items.

4. Free leveling of crafting via refinement and sale to vendors. (the prime example of this is in artificing where you can buy dusts on TP for less then the sale price of the tuning crystals you make them into to merchants).

Minion of Vey.4398:

Being able to sell from anywhere is one of my favorite features in this game. I don’t want it taken away.

Also, even if we couldn’t, we can deposit collectibles from anywhere. It just means instead of posting those venom sacs 2 at a time, I wait til I’m in town then sell them 20 at a time. Doesn’t affect anything, just adds extra inconvenience for no payoff.

It won’t be taken away. It will however force you to purchase the item in the gem shop that is supposed to allow you to sell from anywhere. You will instead have to buy the black lion trader express.

New gold sink and now your convenience bank has even higher cost of use.

Zak.8274:

I would venture to say that I abuse the current TP a bit in a couple ways. None of which I would say were intended in its creation. MIght be helpful in gauging it’s status.

1. Buying greens at 1 c above vendor sell price and then being able to sell a full set of equips at a 10 c loss to vendor everytime I level to the next tier (this is lolzy, also I never repair because I can always just replace equips for a 1 c loss).

2. Buying base mats on the TP and then being able to refine and sell for more despite the 15% fee. (this is slowly becoming less viable as the market stabilizes though).

3. Speculation using the offer feature. This usually allows you to dodge the 15% fee because the offer is almost always at least 15% below the instant price for commonly traded items.

4. Free leveling of crafting via refinement and sale to vendors. (the prime example of this is in artificing where you can buy dusts on TP for less then the sale price of the tuning crystals you make them into to merchants).

That’s actually quite hilarious
Especially number 1.

(sorry for the double post, i cant get the edit button to show, one of the forum bugs)

Though to circumvent this, Anet could make it so that if you want to vendor an item it has to be fully repaired or something. Though I hope not, cause this is pretty funny.

I think the real problem is not read in the OP. It’s not that there is trash on the TP and that people may or may not be buying that trash. And it’s not that stuff is cheap. But that practically everything even items of significant enough value to others are all listed at 1c above vender value. Thus making selling the items to the vender instead of another player more profitable. The simple solution to this whole thing is to have the minimal price of the TP be 1c over vender price + 15% listing fee. That way trash is still trash but it shifts the more profit to be had from the TP than from the vender if indeed the trash sells to others. If the trash doesn’t sell to others then those that listed it are at a loss instead of everyone else who would actually like to make profit on items that actually are of value and others want to buy.

Example. Everyone in the game all uses jewelery and pretty much crafted is always better than any jewelery that can be obtained other ways for each level requirement. In other words take level 20 (just to pick a level) all the crafted jewelery is better than any other level 20 jewelery. Yet because of lazy listing (I see no other reason for it) it’s all listed at 1c over vender price even though it’s the best stuff everyone can wear. And thus has a demand of practically the whole player base. Logically I would want to sell the jewelery to other players since they want the items. But it is illogical for me to do so since I get more for selling them to the vender.

That should not be the case. We expect that anything of value to anyone else would be better than selling to the vender even if we just net as little as 1c more than vender price. By setting the minimum sell price to allow for a minimum of 1c profit it allows supply and demand to do it’s thing and also keep items of value from being worth more to be sold to the vender than to other players. And at the same time trash will still be trash. People will still be able to list the trash. But what changes is that the stuff that actually has value will properly be worth more selling to players instead of to the vender. After all even if you only make 1c more than selling the item to the vender it’s still profit. And those who can’t be bothered with such little profit can still sell to the vender. But at least those who want to supply players with the stuff they want to buy won’t be punished by getting less than they would by selling to the vender because the price floor is below the break even point because of the TP fee.

@Jia Shen.4217
Before you move on to proposing suggestion, answer the following question:
How much is a trash worth to you?
If it is priced at vendor +1 will you buy it?
What determines the value/price of an item?