No it isn’t. “Printing cash” does not mean physically printing money. The analogy is bad. I could also point out reserve requirements impact inflation. And a bigger money supply can lead to higher output of production which can drive down prices as well, if that capital is implemented that way.
You fail to account for the fact that only items vendored creates coins, and omnomberry bars and other coin boosters with coin drops.
The majority of wealth players bring to their accounts from farming is crafting materials, ectos from salvaging, selling rares and exotics on the TP all are taxed. Which all would have a downward drive on prices, as more supply at higher prices would create surplus.
You have to measure how much new wealth they create vs. the wealth they deplete. And how many times they make transactions with other players. V(elocity) is an important part of the equation as well.
I was not attempting to be exhaustive when I said gold generation was like printing money; I could have been more precise and said that farming generating gold is like increasing the money supply, the point should’ve been clear though. And while you can indeed situationally increase the money supply in a way that does not generate inflation in the real world, that does require specific non-normal conditions to be met. Again, I was not attempting to be exhaustive in the analogy.
I have a suspicion that you actually have a hidden assumption that I wasn’t making, and that we actually agree about this though, so let me be clearer about where I was coming from:
For an MMO economy, in general, farming is the only source of gold, this is true even in GW2. The amount of gold generated by farming (plus other stuff, but farming generates the most “stuff” regardless of what the stuff is) is the money supply for the economy as a whole. Items in aggregate cannot be traded for more than the sum total of gold harvested by players (and in the case of GW2, minus the transaction fee of trading them). If people do not farm lots of gold, prices in the aggregate, assuming we don’t move to a barter economy (which would be hard since we can’t safely trade without using the TP), cannot increase; without gold generation in excess of gold sinks, you cannot have inflation. In fact, if gold isn’t being pumped into the economy enough so that the transaction fees from multiple TP listings eats it all up, we’d be seeing rampant deflation and the entire market would be in the process of grinding to a halt.
Now there are a number of factors to GW2’s economy that mitigate the inflationary effect of gold generation. The sinks seem really well balanced, especially relative to other mmos, and the TP tax likely does a good job of soaking up excess supply. But farming has to be the primary source of gold in the game, there has to be some amount of positive growth in the gold supply, or the economy would be seeing other significant problems. Gold generation is “wages”, and you can’t have a wage-price spiral without wages going up. Even if demand massively outstripped supply, that wouldn’t matter much if players had insufficient gold to spend.
But those are considerations, in principle. They’re obviously not actually happening in game; we’re not really seeing serious signs of inflation in the economy, gold is clearly being supplied sufficiently that things aren’t being ground to a halt, and the sinks seem balanced enough that there are many goods that have had stable prices for months. So it does seem that Anet’s so far been managing the size of the gold supply very well. So in practice, it may be that farming won’t cause inflation, in GW2, because of how Anet has mitigated against it. But farming in the abstract most definitely does cause inflation.