08-13-2012, 01:11 PM
ATTENTION: Due in part to the extreme controversy of this subject, and the impending server update. The current Economy will remain in effect (transferred) with capped interest rates. The interest rates are broken and don't reflect the original author's intent (clownfish).
ATTENTION: Our server will run test economies on the test server, starting first with "Reactive Supply and Demand" (Server Run Shop with Personally owned shops.)
Furthermore, I am going to elaborate what an economy is, its' functions and its' usages in a fluid, cash flow system. But before I do that, I feel it largely necessary to explain the fundamentals of an Economy. It seems a large majority of people here view Economy in a very simplistic sense (nothing wrong with that). But it is creating a lot of confusion with what others are saying to each other. And how each economy will actually influence the server.
DEFINITIONS:
Supply & Demand: In a competitive market, supply and demand determine the prices of items, which will vary until it settles at a point where the quantity demanded by consumers (at current price) will equal the quantity supplied by producers (at current price), resulting in an economic equilibrium of price and quantity.
Four laws of supply and demand:
1: If demand increases and supply remains unchanged, then it leads to higher equilibrium price and higher quantity
2: If demand decreases and supply remains unchanged, then it leads to lower equilibrium price and lower quantity.
3: If supply increases and demand remains unchanged, then it leads to lower equilibrium price and higher quantity.
4: If supply decreases and demand remains unchanged, then it leads to higher equilibrium price and lower quantity.
Graph to Clarify how supply and demand works:
http://upload.wikimedia.org/wikipedia/co...nd.svg.png
MARKET:Market is the structure of individual people or units which comprise the economy. The Market and Microeconomics deal with irreducible base unit, private, public and domestic players.
Monopoly:A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity
Monopsony: (opposite of monopoly) is a market form in which one buyer faces many sellers. It is an example of imperfect competition, similar to a monopoly, in which only one seller faces many buyers. As the only purchaser of a good or service, the monopsonist may dictate terms to its suppliers in the same manner that a monopolist controls the market for its buyers.
(SOURCE: WIKIPEDIA)
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ARGUMENT PART 1:
Theory: Our server is being run as a dual Monopsony (mostly) and partial Monopoly (certain items).
Here is a list of examples to support my theory:
-Diamond demand is high, supply is low. According to the laws, the equilibrium price should be high with the lower quantity. So Diamond prices should be HIGH, with the unchanging demand and lack of supply. It is VERY LOW.
-Gold demand is unchanged. (might have changed recently with economy talk) Supply is high. According to the laws, the price of gold should steadily decrease, because the demand is consistent (unchanged) but still desired. Yet, it remains at about $2-$3 per ingot. Gold is not lowering, but fluctuating wildly, in either direction.
-There is no seemingly irreducible value of any item on the market. Diamonds have gone as low as $10 per diamond, some even $8 (rare). Dirt is sold at $1 per stack, $0.5 per stack, and some as low as $0.2 per stack.
-Stone is at $3 universally, per stack. I have seen lower in some areas.
-Cobblestone is at $1 per stack, universally.
-There are countless other shops with absurdly low prices on dozens of goods.
-Wool prices in minemall are at an all time high, with no one but this shop owner being able to keep up with the supply, or willing to keep up.
P.S. I have NEVER seen an Economy that has an average $20 for the price of diamond. This price is absurdly low and unrealistic. I have also never seen the price of gold in any economy being so low. How low gold is, is absurdly unrealistic. This is partially because of the great golden planetoid mining expedition. But also due to other varying factors.
CONCLUSION: Our server is running on a Monopsony with most supplies, and a Monopoly on other supplies. Monopsony with every basic good, dirt, stone, glass. Monopoly with other supplies: Wool, Potions.
With Gold Standard run economy, the user base would have more money to spend, and the shop owners would not feel the need to cater to every buyer who comes to their store.
This means we have an IMPERFECT economy on both scales. Every shop owner is competing like Wal-Mart, trying to brand themselves as Wal-mart, or "complete" shops which sell everything. Because the buyers of the economy feel they can simply go to another shop to get what they want. I suggested the Gold Standard Economy because it would greatly influence people to specialise in certain products, rather than focus on everything. They would need to spend time and effort in obtaining goods, and could procure their own cash.
THIS IS WHY I DISAGREE WITH A SERVER RUN SHOP!
NOTES:
This post here is to address WHY we want to change the Economy, for those who think it shouldn't change. So as to keep my posts short and as simple as possible. I will be posting my second and third argument breakdowns for other parts of Economic function at a later time.
ATTENTION: Our server will run test economies on the test server, starting first with "Reactive Supply and Demand" (Server Run Shop with Personally owned shops.)
Furthermore, I am going to elaborate what an economy is, its' functions and its' usages in a fluid, cash flow system. But before I do that, I feel it largely necessary to explain the fundamentals of an Economy. It seems a large majority of people here view Economy in a very simplistic sense (nothing wrong with that). But it is creating a lot of confusion with what others are saying to each other. And how each economy will actually influence the server.
DEFINITIONS:
Supply & Demand: In a competitive market, supply and demand determine the prices of items, which will vary until it settles at a point where the quantity demanded by consumers (at current price) will equal the quantity supplied by producers (at current price), resulting in an economic equilibrium of price and quantity.
Four laws of supply and demand:
1: If demand increases and supply remains unchanged, then it leads to higher equilibrium price and higher quantity
2: If demand decreases and supply remains unchanged, then it leads to lower equilibrium price and lower quantity.
3: If supply increases and demand remains unchanged, then it leads to lower equilibrium price and higher quantity.
4: If supply decreases and demand remains unchanged, then it leads to higher equilibrium price and lower quantity.
Graph to Clarify how supply and demand works:
http://upload.wikimedia.org/wikipedia/co...nd.svg.png
MARKET:Market is the structure of individual people or units which comprise the economy. The Market and Microeconomics deal with irreducible base unit, private, public and domestic players.
Monopoly:A monopoly exists when a specific person or enterprise is the only supplier of a particular commodity
Monopsony: (opposite of monopoly) is a market form in which one buyer faces many sellers. It is an example of imperfect competition, similar to a monopoly, in which only one seller faces many buyers. As the only purchaser of a good or service, the monopsonist may dictate terms to its suppliers in the same manner that a monopolist controls the market for its buyers.
(SOURCE: WIKIPEDIA)
——————————————————————————————————————————————————————
ARGUMENT PART 1:
Theory: Our server is being run as a dual Monopsony (mostly) and partial Monopoly (certain items).
Here is a list of examples to support my theory:
-Diamond demand is high, supply is low. According to the laws, the equilibrium price should be high with the lower quantity. So Diamond prices should be HIGH, with the unchanging demand and lack of supply. It is VERY LOW.
-Gold demand is unchanged. (might have changed recently with economy talk) Supply is high. According to the laws, the price of gold should steadily decrease, because the demand is consistent (unchanged) but still desired. Yet, it remains at about $2-$3 per ingot. Gold is not lowering, but fluctuating wildly, in either direction.
-There is no seemingly irreducible value of any item on the market. Diamonds have gone as low as $10 per diamond, some even $8 (rare). Dirt is sold at $1 per stack, $0.5 per stack, and some as low as $0.2 per stack.
-Stone is at $3 universally, per stack. I have seen lower in some areas.
-Cobblestone is at $1 per stack, universally.
-There are countless other shops with absurdly low prices on dozens of goods.
-Wool prices in minemall are at an all time high, with no one but this shop owner being able to keep up with the supply, or willing to keep up.
P.S. I have NEVER seen an Economy that has an average $20 for the price of diamond. This price is absurdly low and unrealistic. I have also never seen the price of gold in any economy being so low. How low gold is, is absurdly unrealistic. This is partially because of the great golden planetoid mining expedition. But also due to other varying factors.
CONCLUSION: Our server is running on a Monopsony with most supplies, and a Monopoly on other supplies. Monopsony with every basic good, dirt, stone, glass. Monopoly with other supplies: Wool, Potions.
With Gold Standard run economy, the user base would have more money to spend, and the shop owners would not feel the need to cater to every buyer who comes to their store.
This means we have an IMPERFECT economy on both scales. Every shop owner is competing like Wal-Mart, trying to brand themselves as Wal-mart, or "complete" shops which sell everything. Because the buyers of the economy feel they can simply go to another shop to get what they want. I suggested the Gold Standard Economy because it would greatly influence people to specialise in certain products, rather than focus on everything. They would need to spend time and effort in obtaining goods, and could procure their own cash.
THIS IS WHY I DISAGREE WITH A SERVER RUN SHOP!
NOTES:
This post here is to address WHY we want to change the Economy, for those who think it shouldn't change. So as to keep my posts short and as simple as possible. I will be posting my second and third argument breakdowns for other parts of Economic function at a later time.