How will new players perceive this game? (A pessimistic outlook)

[Azurymber]

in regards to purchasing from vendors:

that is true. but at the same time that ruins gathering jobs for a fairly long period by making them unprofitable. And from what i gathered, gathering jobs are meant to be a "main" job in the game. Further vendor items for crafting and use only create an inflationary cap. Like once the prices of goods exceeds the price at NPCs people will buy from NPC vendors, some money will exit the economy, and it will be viable for players to sell goods just under the NPC prices once again, in which case money will stop exiting. As a result the economy would average out at that point.
Put another way, 1 week you would be buying stuff from NPCs, then the next week from the wards, then the next week from NPCs, then the next week from wards, etc. NPC prices will determine the "limits" of monetary expansion, but it will not fix an inflated currency.

And that will still make it very difficult for new players to catch up because NPC items are overpriced on purpose.

One solution i can think of would be to release really good items that are sold by vendors, or have a dynamis-weapon type thing and sell the currency at vendors. But the problem still remains that a lot of people who got like 10-20 mil at the start and quit temporarily will come back and constantly cause inflationary spikes.

Also on a note: I think SE attempted to drain gil from FFXI via NPCs in CoP for end game gear. It didn't seem to work well and again, the economy didn't fix itself until there were mass bans. Doesn't mean its impossible to do, just probably difficult.

in regards to taxes:
10% per sale tax still doesn't drain massive amounts of money out of the economy. FFXI is the proof behind this, since it experienced hyperinflation and the AH tax did nothing to correct for it. Possibly a 40% tax on sales would work, or some kind of incentive to sell things -A LOT- more than currently. But right now people don't buy enough for taxes to be a gil sink. I rarely buy anything from the wards, and for high priced items i trade to avoid the tax. Now if they taxed trading as well, thats another story.

[darkstarpoet1]

that is true. but at the same time that ruins gathering jobs for a fairly long period by making them unprofitable. And from what i gathered, gathering jobs are meant to be a "main" job in the game. Further vendor items for crafting and use only create an inflationary cap. Like once the prices of goods exceeds the price at NPCs people will buy from NPC vendors, some money will exit the economy, and it will be viable for players to sell goods just under the NPC prices once again, in which case money will stop exiting. As a result the economy would average out at that point.
Put another way, 1 week you would be buying stuff from NPCs, then the next week from the wards, then the next week from NPCs, then the next week from wards, etc. NPC prices will determine the "limits" of monetary expansion, but it will not fix an inflated currency.

And that will still make it very difficult for new players to catch up because NPC items are overpriced on purpose.

One solution i can think of would be to release really good items that are sold by vendors, or have a dynamis-weapon type thing and sell the currency at vendors. But the problem still remains that a lot of people who got like 10-20 mil at the start and quit temporarily will come back and constantly cause inflationary spikes.

Also on a note: I think SE attempted to drain gil from FFXI via NPCs in CoP for end game gear. It didn't seem to work well and again, the economy didn't fix itself until there were mass bans. Doesn't mean its impossible to do, just probably difficult.

i do see what you mean by it will not fix inflation, but it would level it out. i'll use the cost of buffalo skins on my server for example.

a few months ago a buffalo skin you could purchase in wards for 8k. by the time you bought the dye and chips you could make sell them for 8k each for dyed buffalo leather. you would make a decent profit and the next crafter would make a decent profit off it when they resold the next item in wards.

now the same skin sells for 20k. that increased 12k per skin or 3k per leather however you want to look at it now has the cost of what was 8k for a buffalo leather gone up to around 12k. this also turns around to an increase for the crafter that was buying the skin to make the next item.

if the npc has the skin for a reasonable price say 8-10k which is what the skin was and it is an easy item to get then it would cut the cost of that item in wards by half. we mention the gathering classes, but in most cases alot of the inflation and price gouging has came from the gathering class and as long as raw materials continue to increase the crafting classes will have to continue to raise prices to match.

[Teroril]

i do see what you mean by it will not fix inflation, but it would level it out. i'll use the cost of buffalo skins on my server for example.

a few months ago a buffalo skin you could purchase in wards for 8k. by the time you bought the dye and chips you could make sell them for 8k each for dyed buffalo leather. you would make a decent profit and the next crafter would make a decent profit off it when they resold the next item in wards.

now the same skin sells for 20k. that increased 12k per skin or 3k per leather however you want to look at it now has the cost of what was 8k for a buffalo leather gone up to around 12k. this also turns around to an increase for the crafter that was buying the skin to make the next item.

if the npc has the skin for a reasonable price say 8-10k which is what the skin was and it is an easy item to get then it would cut the cost of that item in wards by half. we mention the gathering classes, but in most cases alot of the inflation and price gouging has came from the gathering class and as long as raw materials continue to increase the crafting classes will have to continue to raise prices to match.

The reason economies in online games don't work in the same way as in the real world, is because exploitation doesn't exist. There is no world system in which you can underpay some demographic to process whatever good you're selling. So profits are pretty slim. Also, everyone are on the same terms when it comes to production (aside from getting the skill level), so there is no economy of scale. Basically. Most of the incentives that drive competition aren't present in most mmorpgs (besides EVE Online).

And without competition, optimization of markets won't exist, so there is no "invisible hand" to direct the market. This is why making an in-game economy work seems almost impossible.

Maybe, what we need is some reverse Keynesian ingenuity from the developers. Creating incentives to buy from NPCs, when prices are high. But, the main dilemma we're facing in any MMORPG is the paradox of printing money, to create growth. In the mid-term, it creates inflation, because there are too many bills in circulation. So maybe what we need is regulation of gil coming into the market (in this case, the players' hands) through flexible monetary rewards and NPC prices.

Edit: Speaking of Keynes. What we really need, is incentives to spend money within the game, one way or the other, so players don't hoard cash, effectively creating the higher prices.

One suggestion could be to make NPC prices be dependant on how many gil a player has. The more gil the player has, the more expensive the items from the NPC will be. This will create an incentive for players to not hoard. The level of price increase will determine the equivalence of money in each players' hands on average. Of course, players might just start trading... But why not make a flexible tax rate, depending on the amount of money an item sells for? This might require a more advanced algorithm depending on the quality and level of the item sold (so high level rare items aren't sold for less than they are worth).

[Azurymber]

The reason economies in online games don't work in the same way as in the real world, is because exploitation doesn't exist. There is no world system in which you can underpay some demographic to process whatever good you're selling. So profits are pretty slim. Also, everyone are on the same terms when it comes to production (aside from getting the skill level), so there is no economy of scale. Basically. Most of the incentives that drive competition aren't present in most mmorpgs (besides EVE Online).

And without competition, optimization of markets won't exist, so there is no "invisible hand" to direct the market. This is why making an in-game economy work seems almost impossible.

Maybe, what we need is some reverse Keynesian ingenuity from the developers. Creating incentives to buy from NPCs, when prices are high. But, the main dilemma we're facing in any MMORPG is the paradox of printing money, to create growth. In the mid-term, it creates inflation, because there are too many bills in circulation. So maybe what we need is regulation of gil coming into the market (in this case, the players' hands) through flexible monetary rewards and NPC prices.

Edit: Speaking of Keynes. What we really need, is incentives to spend money within the game, one way or the other, so players don't hoard cash, effectively creating the higher prices.

One suggestion could be to make NPC prices be dependant on how many gil a player has. The more gil the player has, the more expensive the items from the NPC will be. This will create an incentive for players to not hoard. The level of price increase will determine the equivalence of money in each players' hands on average. Of course, players might just start trading... But why not make a flexible tax rate, depending on the amount of money an item sells for? This might require a more advanced algorithm depending on the quality and level of the item sold (so high level rare items aren't sold for less than they are worth).

great post.

Only thing i see wrong with scaled npc prices is that people would transfer gil to another character and just buy stuff on that character.

I think incentives are the key though. This could be accomplished with the company system. Ex.
Each company has 20 really good items which you can buy with company points
Every day the company requests one piece of equipment from the game, which is random and different for every person. You can find what this item is via a npc linkpearl.
If you return it you get x points.

This would create a market for the 100s of current goods that are lacking in demand. It would force people to trade more, which would increase the gil depletion via taxation. And if coupled with NPC's that sell mats at a much better price than currently, it would provide a gil sink through purchases from NPC;s.

Then again there are 100 different possible ways to fix the problem. It just doesn't seem like SE is capable of it or has any clue what they are doing economy-wise.