Help with game economy

Whilst I actually intend to give you a more detailed post in an hour or so - I am interested in the following aspect:

What consideration have you given to managing your economy in an environment where the professional gold sellers intrude into your game?


Also a recent thread discussion in Game Economics:

http://www.gamedev.net/topic/622510-game-economics/

I am not sure what you mean by "gold sellers", or what you mean by "intrude". If you mean vendors, like NPC types who you buy and sell things from that are the main requirement of having currency in the first place... their place in the game will be fairly paramount from an economic standpoint just like most RPGs.

I just had a short e-mail correspondence with our head of character development and asked if certain character classes would be more married to particular vendors based on the types of things they would buy and sell, and the response I got basically said that she is slowly guiding the design more towards the idea that all vendors entrenched in main areas will likely be all around "buy anything, sell everything" types, so they won't have much specific impact on the game other than being obvious lynchpins of the economy.

My apologies -- by gold sellers I mean the practice of organisations and individuals external to your organisation to farm "gold" and then sell it to other players for real life money ref: http://en.wikipedia.org/wiki/Gold_farming

Given that this practice can have quite a dramatic effect on a game economy and you hadn't made mention of it in your initial post I thought it a relevant question to ask esp. as you mentioned the possibility of launching your game as an MMORPG.

Gold farming actually has been discussed a few times. We basically decided that it is not 100% preventable were the game to be an MMORPG. The best we can do is have monitoring elements in place to detect things like code that makes characters able to earn currency while the real world player is not actually at the computer, and limit daily player to player currency transfer (such as set a cap on how much currency can be given to you from other characters in a 24 hour period) this would have to include items as well, so they can't circumvent the gold transfer cap by being given several items to sell to vendors.

After reading the thread you linked me, I was very ...I guess I should say "titilated" at the idea of a pseudo stock type system where certain resources rise and fall in supply and demand which can thereby sway the activity of players. I will bring this up to the rest of our team. Are there any games known to do this already? (like RPGs and the like, not games that would be specifically geared toward economic strategy as a primary focus).

Three ways to hinder "gold selling," but not gold farming:

1. There are to be no direct exchange or vendor market.
   
2. All transaction must go through an exchange system, not an auction system.
   
3. Use Diablo III's Real Money Auction House.
   

1) Direct exchange is what allows gold sellers to sell gold. They do a direct transaction to players in a price ratio that is unfair to market price. Thus, we have to prevent this from occuring.

2) An exchange system takes both ask and bid prices. This allows the market to say near the running equilibrium that changes base upon the condition of the market. This allow the market to adjust at all times to the demand and supply. With an auction system, the gold seller will farm items and form a cartel with a huge price tag of their items causing players to buy gold in order to buy items on the auction house. Get the trend? That's how the gold sellers make their money. They sell items on an auction house at a ridiculous price, and sell those gold right back to the players.

3) Diablo III's Real Money Auction House seems to help hinder the gold sellers by making all players become gold sellers.
http://tobolds.blogspot.com/2012/06/workification.html
http://www.alexc.me/why-diablo-3-is-less-addictive-blizzard-responds/441/
These two links explain why hindering gold farmers is not the best thing to do. Players like gold farmers even though they say otherwise. It's the game companies that hate gold farmers, not the casual players. The game companies want to maximize profit, and they will do so by hindering third party from making profits off of their game. Diablo III does not have as much fun as Diablo II by players who define themselves as somewhat more core than casual players, yet not as core as the hard core players.

After reading the thread you linked me, I was very ...I guess I should say "titilated" at the idea of a pseudo stock type system where certain resources rise and fall in supply and demand which can thereby sway the activity of players. I will bring this up to the rest of our team. Are there any games known to do this already? (like RPGs and the like, not games that would be specifically geared toward economic strategy as a primary focus).

None that I am aware of though I would not be surprised if there is some such system in amongst this list or more likely within the realms of indi-built games

http://www.giantbomb...demand/92-2905/
http://en.wikipedia.org/wiki/M.U.L.E.

The problem with trying to develop a meaningful economy in a game comes down to one factor and one factor alone: infinite resources. For example: in an MMO that has mining as a profession, the respawning of mining nodes never stops....ever! The respawning of herbs never stops! The respawning of mobs never stops! etc etc. It is an inevitable consequence that players will end up with more ingame currency than get consumed by gold sinks. In real life this does not really happen - an infinite (relatively speaking) resource such as the air we breathe is essentially free and as a resource become more scarce so the price for that resource increases (there are exceptions to this rule but it falls outside the scope of this conversation).

One way in which you might constrain an economywould be creating an environment where the infinite resources you allow a player to access are essentially free and the resources you wish to generate a stable economy with should spawn as they are processed out of usefulness for example a piece of manaufactured armour which cost 5 (raw) iron to manufacture is sold to a vendor - an equivalent spawn is created in the game world. Determining the needs of a player for certain levels of materials could then be balanced against the server population to provide "silent caps" of available resources in the game. Combining this with gold sinks for "novelty" or costs in travel, taxes etc would help erode over excessiveness...this is not a perfect system by any means...but that's the problem with artificial economies - they are constrained by rule sets created for that artificial world.

Efficiency and Resources:
As players are higher level, they are able to loot low level monsters at a quicker rate, thus leading to inflation. The only way to counter this effect is to either 1) nerf the capacity of high level characters killing low level monsters, or 2) make the game realistic where the amount of resources is throttle similar to how internet service providers could throttle bandwidth of their users. Make the game throttle the resource rate such that there is a cap based on the level of the character. The more the character level is away from the optimal range, the less they could loot.

Summary:
Make resources throttled based upon the character level that should get that particular resource. If they are higher or lower level, then they will loot less resources. Or like Blizzard's WoW, have low level monsters one-shot high level players.

We are not so much concerned with the creation and maintenance of a perfect virtual economy. The trouble we are trying to overcome at this point is how to balance the acquisition of currency with the acquisition of experience points, skill level, and game progression. We are worried that if we don't get the balance right, as you progress through the game the imbalance will build upon itself to the point where the gameplay is ruined.

The trouble we are trying to overcome at this point is how to balance the acquisition of currency with the acquisition of experience points, skill level, and game progression. We are worried that if we don't get the balance right, as you progress through the game the imbalance will build upon itself to the point where the gameplay is ruined.

If you do this game as an MMO a player's first alt (assuming same faction, server etc) will pretty much collapse this philosophy unless you constrain the player from being able to outfit his alt with money or gear or making deals with other players to do the same for their alt. Also with real life relationnships between players you often find that one player being more advanced in the game might outfit his/her mate who has just joined the game.

I must apologise that I can't continue on atm - sleep beckons. Will endeavour to address your point sometime later todayish.

Higher level tools should be expensive to maintain, and they should only increase the damage by a little amount, but make it possible to "penetrate the skin" of higher level monsters.

You might be able to kill a rabbit in 1 second with your magic wand of doom, compared to the 20 seconds it took from a noob using his bare hands, but you still need to spend time finding the next rabbit, and all the extra resources you get due to being faster go to loading more magic or resting to keep your wand powerful.

I have been mildy curious, whether it is theoretically possible to devalue currency at higher levels in an MMORPG.

One of our economy team mentioned during casual discussion last week how he remembered in Diablo II where players would reach a point in the progression of their character, where gold no longer mattered because the things you could do with it were useless to powerful characters. I vaguely remember this as I have not played the game in over a decade. It was something to the effect that anything that was sold, was useless compared to what was offered from fallen enemy looting and spells.

I reaaaally doubt we would consider anything of that sort, but it is interesting to contemplate a system where low level users utilize currency and vendors, and you eventually progress to a point where you must rely on a barter system between other players.

We are not so much concerned with the creation and maintenance of a perfect virtual economy....We are worried that if we don't get the balance right

perfect virtual economy = balance economy
You're contradicting yourself! In a perspective, a perfect virtual economy is a balance economy. It does not have to simulate the real world economy. It only has to have its own demand, supply and equilibrium based upon demand and supply.

devalue currency at higher levels in an MMORPG

devalue currency = Inflation
It is always possible to devalue currency through inflation!

The goal of currency is to prevent the old system of bartering. If you have to barter, then don't use currency in the first place. After all, that's the ultimate goal of currency. In the past, gold for royal, silver for noble & gentleman, and copper for the commoner. Each level of the population use a different currency. The problem with games is that everyone is as rich as Bill Gates once they reach a high enough level. If you want to prevent that from happening, then that is called a "Balance Economy."

Summary

1. Gold for Royalty
   
2. Silver for Noblity & Gentleman
   
3. Copper for Commoner
   

So you would suggest having currency in different tiers?

So you would suggest having currency in different tiers?

It is feasible to do it this way -- by simply setting value thresholds that make materials at hugely different price ratios - for example skill level 1- 10 you would buy materials that are cheap and nasty for coppers. For your skill level 11 - 20 you would price your materials at silver and so on. By then implementing a value of something like 1000 copper = 1 silver instead of the generic 100 to 1 -- you could establish a prohibitive threshold tied to the level of the character's own level i.e. when they reach level 10 warrior for example they would access the silver economy via quests etc.

So basically your character's access into different tiers of economy access tied to progression is a viable way of doing it. For a single player this can work quite well - for a multiplayer this however can fail for reasons as covered by

If you do this game as an MMO a player's first alt (assuming same faction, server etc) will pretty much collapse this philosophy unless you constrain the player from being able to outfit his alt with money or gear or making deals with other players to do the same for their alt. Also with real life relationnships between players you often find that one player being more advanced in the game might outfit his/her mate who has just joined the game.

If you do an MMO:
If you really want to have a balance of currency, experience, skill level, and game progression, then you have to make the game so hard that only the best players could even progress to the next level, and combine this with item degrading. That way, if the best posible players trade his item with the second best players as the only way for the second best players to progress. The difficulty has to be formiddable, and if you cannot maintain this level of difficulty, then the economy will run wild. Even the third best of players cannot use the items from the best of players to progress to the next level. And with item degrading, it is even harder for the third tier of players. Thus, they have to wait until the first tier of players progress to a certain level ahead of them as well as the second tier of players. The point is to make it difficult for players to farm the item in any way. Only the best players have to capacity of using the current items they have to fight.

• Top Tier Players - Use Level 1 Items to fight Level 2 Monsters
  
• Second Tier Players - Use Level 2 Items (farmed by Top Tier) to fight Level 2 Monsters
  
• Third Tier Players - Use Level 3 Items (farmed by Top Tier) to fight Level 2 Monsters
  
• Fourth Tier Players - Use Level 4 Items to fight Level 2 Monsters
  
• Fifth Tier Players - Use Level 5 Items to fight Level 2 Monsters
  
  Basically, without these higher level items, lower tier players cannot fight against the monsters. If you make a game too difficult, then players would not play your game, but if you make the game too easy, then the economy will run rampant. Thus, the difficulty of the game, as well as the balance of the economy needs to exist. The reason for item degradation is that players weak players will end up spending higher level items, and the demand for high level items will always be there. These weaker players cannot provide a supply of items for themselves. Only stronger players could maintain a supply of items for the weaker players, causing a bottleneck to leveling up.
  
  Having a bottleneck to leveling up would not be casual friendly, and business is about being casual friendly. That's why casual games have a harder time with balancing their economy. The more casual friendly an MMO becomes, the harder it is to balance the economy.
  
  Single, Multi, or LAN games
  It is much easier to balance an economic system that is for a small number of players. However, any game that would allow the masses to come will be much more difficult.
  
  I would say that EVE Online fails when they use a closed economy system. They also have a shift towards being a more casual game than when they first started.

EVE Online is one of the few MMORPGs that we are going to be getting multiple user subscriptions to for our team to work on over the winter. We do wish to have more of a casual game than what you have proposed with high difficulty and strict level requirements on items. We are all just deathly afraid of making one or more things to difficult (too hard to make money, too hard to find decent items, too hard to level up, etc) which would make the game frustrating and not appealing to consumers. The other worry is that one or more things is too easy which makes that aspect of the game boring, or a joke, or pointless.

The balance doesn't have to be so incredibly strict to maintain 100% balance all of the time, our goal is to just keep one or more aspects from being out of balance enough to have one of those major problems I listed above.

**By the way I am Maximum99 from the development team and I'm fresh out of character development and now getting on board with the social/economy part of the team. The person who had been posting on here for our team was Kammerjaeger and he knows a lot more of the gritty details thus far.

Just start with high difficulty and restriction, and then loosen this restriction through pre-alpha testing. You have to start from a structured approach, and use that approach. That's the major thing about all of programming and designing. Once the core of a game is finish, then the core loses some flexibility. Of course, the difficulty and restriction just needs to tone down to a ceratin extent that casual players may still play. If the game is too easy, even the casual players find it boring. Difficulty and restrictions are one of the method to control the economy. There may be other ways, but not one that is on top of my mind. But as all of the others have said on this forum, it is not possible to balance any mmo economy. Only for limited multiplayer and single player could have a balance economy. Even real market like EVE Online needs changes overtime.

Let's compare to the real world for just a moment. Mainstream Economists in the real world likes to have as low of an inflation as possible, but it must be an inflation that is enough so that market changes does not bring the it down to deflation. However, we understand that the best economy is a "deflationary growth." However, deflationary growth is much harder to control than an inflationary growth, and that's why the Mainstream Economists wants to have inflationary growth. They take the easy route.

Now, you have a game economy. Inflationary growth or deflationary growth which do you prefer. In an inflationary growth, the monetary system will always expand, in deflationary growth, the monetary system is fixed. A closed economy runs on deflationary growth. An open economy runs on inflationary growth. EVE Online fails the deflationary growth (equivalent to gold standard), and chose to take the inflationary growth (equivalent to fiat currency). All MMO ends up moving towards the fiat (open) system economy that runs upon inflation. The inflation needs to be tame only with the creation of endless higher levels and stronger items through grinding.

Since you're going casual, having strict restrictions is not the goal. Instead, loosen the restriction just enough for a balance. The amount of players leaving the game because they reach skill cap and gets bored vs the amount of casual players that play your game needs to balance out. If the game is too easy, then high skill players will leave the game, yet if the game is too hard, low skill players will leave the game. Set the game at such a bar where it is near the mode, or slightly lower than the median or mean. That way, players will not feel the game is too easy. Also game music influence the difficulty entirely. There was an indie game developer blog article that I've read, and he says that changing the music will change the perception of difficulty after several attempts to adjust the difficulty.

Why the tier currency system just seems to work? It works better if the teir currency system is not fixed. In fact, having the currency system float is much better. In the old times, 10 copper = 1 silver, 1 pound silver = 1 ounce gold. Today, the 1 ounce of gold is over 50 ounce of silver. Of course, the ratio of conversion widening overtime is what happens in the real world. However, making it widen in the game world will just make the lower value currency obselete to high level characters.

The only way for strict 100% balance is to have a single global exchange system that players could access at anytime they want and it is also the only method of trading items.

You must always expect gold farmers in your game. Either they will be illegally gold selling, or they may be players that love to power level. Of course, when Diablo III develop their RMAH, they made every player [above average] become some sort of item farmer. Items always move from the high skill players to the low skill players, making the game easier to make more game income as the game progress. That's because players have access to items above their own level. Item level requirement could offset and help out the economy. Binding items is another way to help the economy. However, those two methods and their variations are what's expected by any developer as many discontent players keep accusing that other MMOs are UO clone, EQ clone, or WoW clone. Features of any earlier MMOs are not worth mentioning.

Minimize the income difference between players of different levels, or limit the overall amount of levels will both help to keep the economy in balance.

No lootable equipment; boss drops materials to craft higher quality items for that level bracket.
Crafting with increase in low level materials. [Tiered Items]
Always require low level materials for crafting [Material Sink]
Make all crafting done by NPC if you need [Money Sink]

On behalf of the whole team I want to thank all of you for your amazing advice. We have a long, detailed plan written up that we think is understandable to anyone who comes in off the street who has played these types of games before.

We have decided on level (experience) requirements for items to help level the field, a somewhat tiered form of currency, NPC money spending requirements for many things, and a few other more intricate details that tie everything together with the world we are making for this game.

I am also happy to say that we just got our loan out and put 5 programmers on contract for the game, so we'll actually start seeing all this talk, writing, and story-boarding slowly transform into something tangible in the months to come.

Thank you all again for your help!


-Kammerjäger

Good luck with your game. If you run into more issues you know where we hide. Might I also suggest you give consideration to opening up a development journal on the Game Dev website to document your experiences as you move on in the development of your team's game. One way to pre-publicise yourself as well enabling other developers/future developers to gain insights valuable to their own personal development as game makers. Again all the best.