Showing Posts For Siyeh.2407:
I demand an Earned Copper Tax Credit! I’m so poor BLTC should give me at least one more copper for every one I earn!
So the level you obtained them at determines their quality? They don’t level up with you?
ty for the info Ron
Really it comes from paying for the retirement benefits and health care of those old pigeons.
Of course a large portion goes to paying flood insurance compensation for citizens of Honor of the Wave, who SHOULD HAVE NEVER BUILT HOMES THERE!
I had the same experience. I saved some from low levels and was very disappointed to see they couldn’t even harvest gold…
I think you’d need to reposes more than just what was bought on credit. Have the borrower put up collateral when the loan is taken out. Maybe mystic coins, or otherwise soulbound items. If the borrower fails to pay back the loan the bank can sell the items purchased with credit and the collateral.
Of course we could have the entire market crash, so that the collateral is no longer worth enough to pay back the banks depositors. I’m sure ArenaNet will implement TIRP (Troubled Item Relief Program)
The TP translates to a dynamic vendor. That is ALL it is. There is no ‘playing the TP’, especially back when the ‘tax’ was 15%.
Those of us who’ve made profits playing the TP would beg to differ.
Sure, not many are playing it by buying materials and selling the finished product for huge profits, since that tends to work poorly. But buying something at a low price and then selling that same thing later at a higher price looks a lot like profit to me, anyway. I don’t have an economics degree, though, so I guess I could be mistaken.
I think he’s trying to talk about economic vs accounting profits. Economic profits are always zero in a competitive market, as they include both gold cost and time cost. The only way to get economic profits out of guild wars would be to lobby ArenaNet for a special recipe that only you can craft and is highly valuable, AND the value of that recipe must be greater than the effort you put into lobbying ArenaNet. Economists call this “rent seeking”. Perhaps there are a few other examples of rent seeking in game, but that’s the best one I can think of. You could even argue that people looking to change the TP are attempting to engage in rent seeking…
Accounting profits means the gold in your tab is going up. It doesn’t take into account the opportunity cost of your actions, and is probably the better measure in this case. Especially since we enjoy playing the game and don’t behave as if it is a job.
If I were you I’d not post what was most profitable if you’re planning on using the information yourself…
Other than that I like your ideas!
@Strill
After thinking for a few. You are correct. I wonder what would have happened if the price ceiling wasn’t in place. I suspect that D2 still wouldn’t have used gold as a currency. Or maybe Blizzard would have had to pull a North Korea and drop a few zeros off everyone’s bank account…
I’ve heard people repeat this over and over again and it’s complete nonsense. Diablo II did not move to an alternative currency because of inflation. It moved to an alternative currency because of price ceilings! The game limited the amount of money you could carry at one time, thus whenever anyone wanted to trade for something that was worth more than the money cap, they used stones of Jordan. It had absolutely nothing to do with inflation at all.
I did play the game only after LOD. I never traded anything for gold, nor ever saw a price quoted in gold. I don’t think you could have bought a chipped gem for gold… Was the situation different in hardcore?
CdrRogdan: any chance that you’re Chinese?
Quoting seems to be not working…
“I can see the point that Shannae made on the relationship of price ceiling and inflation. If the ceiling is lower than the price that player is willing to pay, that means they are paying less for an item which is more valuable, thus they have a surplus of money to be spend elsewhere (increase in purchasing power), and when that happen, price of other item that has yet to hit the ceiling will increase.”
But why would we expect there to be any for sale at that price? I suppose a few players might get lucky and happen to be searching at the same moment someone posts one. But wouldn’t enterprising players purchase the item from the TP the moment it went up and re sell it through another venue?
I still think we would see a mostly empty TP. The difference between equilibrium price and the ceiling price would be accounted for in another dimension. Usually through waiting time, in this case through increased search costs.
I’m unsure if the expected value of a fiat currency has to have large variance. Thinking of D2 as an example (apologies if you didn’t play), gold never had much value, so the expected value of gold was basically nill since the beginning of the game (although I did only start playing at LoD, someone please correct me if gold ever was valuable). There was no variation in the value of gold, it was always zero. But players still defined new currencies, and as you say these items had intrinsic value.
Shannae you discussion of the value of time is spot on.
we are talking about a true post scarcity market,
I disagree with this. Without scarcity the study of economics is pointless. All we have to do is come up with new things to be scarce. Reputation, or relative wealth are some of the easier “goods” to think about. I would suggest you can build your reputation by purchasing siege engines in WvW and showing off how wealthy you are to the rest of your server. There will also always be someone who is the richest, many people find value in being at the top of the stack, no matter how high it gets. In that sense somethings will always be “scarce”
I also think your discussion of a price ceiling is a little off. Consider a binding price ceiling (one where the price is arbitrarily set below what the equilibrium price would be). Most econ 101 classes say that there will be shortage, as quantity supplied is less than quantity demanded at the price ceiling. I propose that no one would use the trading post in this case. We would see trading move away from the TP and into forums or general chat. Those who want Item X of Awesomeness wouldn’t be able to find it on the TP and would be forced to go searching for it somewhere else. Those who wanted to sell Item X of Awesomeness would have to spam or spend their time in a forum to sell the item at the equilibrium price. If someone did sell Item X on the TP then an enterprising individual would come along and purchase it and re-sell through spam or a forum for a profit. Again we would have to consider how much players value money now vs money in the future, the taxes on the TP and how much time/effort it takes to sell an item in chat or a forum. So rather than an “item shop” we would have an empty TP. Doesn’t sound great to me.
Considering your discussion of price ceiling and inflation. I’m a little unsure about how accurate you are. You may be totally correct in a “Post Scarcity Market”. Although in the real world price ceilings are often put in place as an (futile) attempt to stop inflation.
Anyway if gold suffered inflation then I suggest we would see players moving to a barter economy, or defining a new currency. This has happened in many other games, from personal experience Diablo II used Stones of Jordan and then rare runes as a form of currency, and it sounds like extos became currency in GW1. All this does is increase transaction costs and encourage a “black market” (one not explicitly controlled by ArenaNet) to develop. Also it would encourage duping of whatever the currency becomes, although this isn’t much different than the problem of gold farming.
Also from reading Wazabi’s posts is sounds like he has an economics education to me at least…
Good discussion Shannae, thanks for taking the time to think intelligently about economics!
Really? try www.gw2spidy.com
I use chrome and it works fine for me…
i love you
on a related note, I’ve messed about selling Jute scraps, Copper Ore etc but I have to agree with Xfury, I’ve only ever really made about 2s from it (from buying ore at 16c and selling it at 20c) and it’s not really worth the time investment.
And that is why the gap exists!
I love you for grasping basic economics!
perhaps the spidy should get stickied?
This is why im so angry, isn’t explained BUT I MUST PAY IT! If it is real life it could be a court though
Have you tried taking the IRS to court?
Well what I wanted already exits.
Don’t get screwed! Use your spidy senses!
2. Buy Orders are Time Consuming
Placing tens or hundreds of buy orders is very time consuming. For high-volume traders, maintaining buy orders is the primary limiting factor. Simply refreshing one’s buy orders over and over again is the most reliable way to increase one’s rate of filled buy orders, and not increasing one’s offered price as it would be in a real-world economy.
Very true, moving to a First in First out system would fix most if not all of the problems on the TP currently. I believe ANET is working on this.
Check out http://www.gw2spidy.com
There is historical price data for most goods, with more coming everyday! Study the charts, see if there are times that you could have bought and sold the same item and made money. This could be over a day/week or whatever. See if those time are consistent, you maybe able to on Wed and sell on Sat evening and make great money, but look at real data to see if that pattern holds up.
I’m of the opinion that farming items that are currently in high demand would be a better way to get some extra cash than trading. ie find an item that is trading for more than it’s historical trend, go out and get a ton of them, and profit! Although I don’t have personal experience. It also sounds like more fun to me…
Time is not a true limiting factor on resources, as you will never actually run out. And as new players can enter the market they provide a greater quantity of those same resources, something that wouldn’t be possible if those resources were limited.
I’m happy that you will never die. Perhaps you can share your secret with the rest of us?
Also I quit. I just hope you don’t vote in whatever country you live in. Obviously you took an econ 101 class and missed most of the important content, and now think you understand how all markets work. Or you’re a political scientist.
Also I am not getting richer from the custom bidding system. Sometimes I sell yellows on the TP (and guess what I undercut by 5ish silver because I want money NOW!) and I’ve never bought anything. That could change once I hit 80. I have 2 gold to my name in game and it doesn’t really bother me much. I’m not very good at combat and I get much more pleasure by improving my fighting skills than getting richer.
Edit: Having ANET put in a infinite buy order at vendor price +15% would be great, and would keep those who don’t know from loosing money.
The TP using a Last in First out system is broken, and should be fixed. As far as I know ANET is working on that.
(edited by Siyeh.2407)
@Siyeh.2407
I personally don’t think equilibrium will ever be reached given that the supply and demand is not static. I see it more as a theoretical nirvana, a center of gravity if you would where price would converge and fluctuate around.
Very true, but we will get closer to that nirvana as the game gets older. Assuming nothing else changes, ie no new crafting recipes, no new legendary and drop rates don’t change. Now is probably the worst time to mess with the system, before we have a good idea of where it will settle.
For that matter you claim that goods are based on supply and demand. Really? Are onions really worth 9 copper based on supply and demand, or are they worth 9 copper because 200,000 people have bids up for them and sell them for 12 and 13, turning capital into incredibly easy money. Chances are there will not be any market adjustments up or down in this regard because people are inherently greedy. Why fix something to some arbritrary ‘supply and demand’ value when you’ve already got a trade that earns you buttloads of money.
Undercutting by 1 copper is an issue because it creates an excessive risk for factors that have nothing to do with your pricing. Though I already proposed a range system that automatically adjusts to account for people undercutting you, that will illiminate this problem.
I don’t even know how to respond. You have lots of vocabulary but it is used very badly. Please explain your compound interest statement.
If somebody is undercutting your price, perhaps you priced it badly in the first place?
And yes the price of onions is at 9 because of supply and demand. If there is a gap between buy and sell orders it is because people value their time, or because they value money now, more than in the future.
If you’re trying to talk about “large” players in the market (those who affect the price when they buy/sell large quantities), that is a legitimate concern. However price ceilings and floors will not solve the problem. They will create new ones. May I direct you to the US Agricultural programs.
As for the gem store, to call something a price ceiling or floor when it is based on mutually agreed exchanges is simply wrong.
I would like to point out that simple supply and demand models are equilibrium models. There is very little reason to expect that the GW2 economy has reached anything like equilibrium one month after release.
Also people motivations are the same in the game as in the real world. They just face different constraints and opportunities. Perhaps I’m getting a bit semantic, but if peoples’ tastes and preferences changed, we’d have to throw all of neo-classical economics out the window.
The price of a good could be continuously increasing, even with adequate supply, without violating the Laws of Supply and Demand. People could be demanding more Vanilla beans every day and the people producing them (by farming?) are simply responding to their demand by producing more of them.
You could be observing inflation, as the total amount of currency in a economy increases the prices of all goods increase.
If Vanilla Beans are a Giffen good (as the price of a good increases people buy more of it), this would violate the simple Law of Supply and Demand, but is not theoretically impossible. Giffen goods are very uncommon (even non-existent in the real world), usually for such things as staple food and for people with very low income. IE if the price of bread rises so much that you can no longer afford meat, you will likely buy more bread to maintain you caloric intake.
If the drop rate was increased, supply would increase, moving the price down. All else held equal.
To answer your final question. Increasing demand or inflation.
That help?
Just a couple of things I would add. You’re last paragraph is correct, but only to a certain degree inside a game. There is much more examples in the game, than in real life, of people deciding not to maximize profit, or to have odd trade offs for personal preference inside the game that people don’t usually have in real life. People are still people in a sense, but people’s character in games often have very different preferences than the person in real life. This is a larger issue than I want to discuss here. I would argue that we have to be careful to remember that motivations in the game aren’t necessarily the same as motivations in real life.
Ohhh, very interesting. I would suggest that players are maximizing their utility rather than profits! Of course your in game wealth impacts the pleasure you get from playing, but obtaining wealth is not free. Nothing in the game is free, they all cost you time!
We could even go one level higher and say that the real person’s utility depends on the enjoyment they get out of the game (along with all the other stuff in the real world people like). Then we would have to consider their ability to spend real $ on ingame currencies, the relative benefit that playing GW2 has to other leisure activities (which is very large!), and a myriad of other things. If there is interest perhaps we could determine the functional form of a players utility function!
The basic problem would be:
Maximize U(X) subject to T=X*t
Where X is a vector of activities you can do in game, t is a vector of how much time each activity takes, and T is the total amount of time you have to spend in game.
Ok I’ll stop now….
I think they prefer to change the sink side of the equation. Witness the temporary recipes for the mystic forge. Creating a new sink would be much simpler than creating new sources of items, and is easier to fine tune as needed.
Provide more information to players. If ArenaNet was able to provide historical prices and quantities traded for each item listed in the TP there would be no more issues.
Those who wished to arbitrage would still be able to. Those who were trying to buy (or sell) at the “true” price would be able to determine if the current price was close to the true price. It would be easy to tell if someone was exerting market power over a specific commodity. Inflation (deflation) would be easy to identify (and maybe even quantify!)
There is little difference between how the real economy works and how the in game economy works. More information or lower transaction costs are always the solution to market failures (Here I mean the transaction costs of obtaining more info, you could put together historic data for yourself, but it would be very time intensive).
Getting rid of buy/sell orders is a terrible idea. If anything options and derivatives should be introduced.
I understand that it is costly for John Smith to provide us with this info, but perhaps some day.
Thank you for putting this together. I’m new to the Mesmer, new to Guild Wars and new to mmos, your videos made me much better and made it much more fun! I can’t wait to see your builds, but I feel that I’ve now got enough knowledge to make my own!
Again, much appreciated! More pvp footage please!
I am a new member in this guild, and am new to MMOs in general. I decided to join after I saw Coolbreez recruiting in chat, and then he showed up to rez me! Everyone is very friendly and helpful, I can’t wait till we get some large scale WvW going on!