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DevBlog: From Barter to Market Economy

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(Posted Thursday 4th of December 2014 on the DevBlog)

 

exchange-market.jpg

 

In-game economy is a crucial aspect of any good MMO game. Very few games however take on the challenge of providing a very realistic, dynamic economy within the game, mostly because it is considered a bit too complicated. The traditional approach is to have a centralized auction system, accessible from various places, allowing people to sell their items to the best bidder. This is an oversimplification of the type of economic exchanges that can take place in a real world economy. Let's look at how this is going to be handled in Dual Universe, and why it matters.
 
Fundamentally, economy is about exchanging things for other things. Goods or services, against other goods and services. It initially starts with barter, and then some reference good is chosen as a common reference, which becomes what we call “money?? and makes it possible to quantify the process (more about the history of money here). In Dual, we will assume there is one single currency across the whole universe to keep things simple.
 
(NB: we will discuss the question of faucets and sinks in balancing the amount of available in-game money in another post. For the moment, let's keep our discussion on the question of pricing and goods exchange)
 
So, at this stage, you have the concept of money and you can start to sell your goods, but you need to set a price. The simplest method is… to set a price. If it's too high, no one will buy. If it's reasonable or down cheap, you'll find a buyer. The core problem here is to figure out a way to assess the price correctly, without too much guessing work.
 
The simplest way to deal with pricing estimation is auctioning: assuming there would be potentially several buyers, let them compete for a time for who is willing to pay the most. This is a bit better than guessing, but not quite perfect: you can always get unlucky and have your good sold for half the price, because you ran out of time or you ran out of wealthy buyers, etc. However imperfect, this is often the only method available if your good is a “one of a kind?? good, for which no other price estimation ever occurred, and no recurring auctioning could be organized. That's why there will still be auctioning in Dual Universe, but that won't be the only method available. Unlike in other MMOs your auction won't be seen from anywhere in the game but only locally (in the “region?? you set it up).
 
The second way to set a price has been invented with market economy: if you are trading goods that are similar in nature and in large quantities, you can set up a market exchange for it. On this market, people who own that particular good can make selling offers. They are listed in increasing order of value: the cheapest offers first, and then the more expensive. Symmetrically, if you want to buy that particular good, you can make buying offers, that are listed in decreasing order: the highest price first, and then the cheapest. Whenever the two lists collide (you have a guy ready to buy at a price higher than the lowest of the seller's prices), you have a deal and the corresponding orders will be then removed from the list.
 
The relative pressure on one side or the other (buyers or sellers) will tend to empty the respective order lists either towards higher prices or lower prices. This is the well known mechanism of supply and demand equilibrium.

 

 

buy-sell-orders.png?w=661&h=372

 

In Dual Universe, creating a market will require nothing more than setting up a Market Unit, a particular Element that you can craft and install in any construct of yours. The Market Unit requires an energy supply and a container to store the traded goods. It can be as small as a front door market in your little farm, where travelers can buy your local production, to an orbital station sized market where interstellar megaships are traded.
 
Importantly, you will access market information (the current list of buy/sell orders for any given good) from a distance, using Information Units to analyze prices on different markets, and compare. This mechanism will naturally establish competition between markets and tend to aggregate them based on geographical or specialization efficiency criteria. When you'll buy a good on a market 1.000km away from where you stand, it will show up in a local inventory physically attached to that particular market container. So, you have to factor in the cost (in time) to get there and collect your good. This is extremely important as it will give birth to local markets in remote areas, which only purpose will be to save you the efforts of organizing the logistics of acquiring goods from afar. This service will translate into higher prices, as those who take the risk of convoying these goods for you have to maintain a sound logistic chain, protect the area, etc.
 
The way markets will work is exactly as I just explained: you can deposit a good in the market container and set a sell order with a given price for it (you will be able to check existing orders to make sure you are competitive). Symmetrically, you can set a buy order where you indicate at what price you would like to acquire a particular good. Now, if you are in a hurry, you can buy immediately by picking up the currently cheapest available price among the sell orders. Or you can sell immediately by picking up the currently highest offer in the buy orders. This difference between immediate and deferred transaction is at the heart of the “time is money?? paradigm: making an instantaneous transaction by taking what is available right now will almost always get you a worst deal than if you had been patient with a buy/sell order listing. For many players, the way to interact with markets will be through instantaneous orders (it's very simple, and you don't need to understand more to play the game). But for some people more into economics, there will be profit to be made, in exchange of time.
 
To sum up, the market exchange model will be a key mechanic because it allows to:
- have a realistic value of any good in game based on supply and demand.
- let the players set their markets anywhere they want, making the geopolitical/strategic aspect of this a core element of the emergent gameplay
- witness market specialization according to what actually happens in the game (not some predefined assumption that will bias the equilibrium)
- allow for lots of specialized activities in game: market owner and manager, trader, broker, exporter/importer, logistic, etc.
 
JC Baillie,
Project Lead

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Joshua:

(Posted Friday 13th of February 2015 on the DevBlog)

 

I think there should be a town or so that had shops that npcs ran them. Mainly like armour,weapons,etc.., but these are only the low grade stuff. To get the higher grade stuff we as players can use an auction or just set up shop to sell them. Or go mine them are selves.

 

Novaquark Team:

(Posted Monday 16th of March 2015 on the DevBlog)

 

The starting zone (the secure area around the Arkship) should have this role (as well as being a “Newbie Zone” to learn the game mechanics):

To bootstrap the economy at the beginning, it will be necessary to have at least a few NPC vendors selling basic equipment.

And from this, the players should have all they need to develop the in-game economy :)

 




 

Estevan:

(Posted Saturday 28th of February 2015 on the DevBlog)

 

would there be npcs to sell things? because i can’t imagine too many people wanting to be in a game where all they do is own a shop. perhaps npcs for the small stuff that people would want to do?

 

Novaquark Team:

(Posted Wednesday 4th of March 2015 on the DevBlog)

 

Yes, for “Economy Bootstrapping” purpose, there will be NPCs to sell basic items.

However, on the long term, the economy will be player-driven: You would be surprised to see how, in some games (EvE we look at you), a fair amount of players have voluntarily taken the role of being trader, industrialist and/or miner. This is all the charm of a sandbox game: a player will stick to the activity(ties) he likes (or he’s more accustomed to). And all players should naturally spread between the different roles the game can offer.

 




 

PetdCat:

(Posted Friday 20th of February 2015 on the DevBlog)

 

Will the market allow for the export of statistics so traders/investors review market trends and place orders? I am a huge fan of the EVE market, but it only works due to the fact that combat is so brutal there is always a demand for not only raw materials, but manufactured goods. Is the plan that combat will be the material sink to keep markets alive, or are you planning on a different mechanism?

 

Novaquark Team:

(Posted Monday 23th of March 2015 on the Devblog)

 

Exporting statistics from the Market has been discussed in the team. This idea will be put in the idea box to be kept in mind, but this won't a development priority. And yes, we expect spaceships and outposts to be destroyed during battles to control territories, in order to be an efficient material sink, as in EvE Online :)

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I understand you've decided on a single currency, but I'm curious. Did you ever consider having no default currency and giving players and organisations the ability to create their own currencies? This could add a great deal of depth to the economies of the game and to diplomatic relationships. Admittedly it would complicate the market interface. Buyers and sellers would have to declare which currencies they can pay in / accept.

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I understand you've decided on a single currency, but I'm curious. Did you ever consider having no default currency and giving players and organisations the ability to create their own currencies? This could add a great deal of depth to the economies of the game and to diplomatic relationships. Admittedly it would complicate the market interface. Buyers and sellers would have to declare which currencies they can pay in / accept.

 

The idea of a single currency is less complicated. If players had the ability to create their own currencies, we'd have conversion issues.

I think it's better to start off with one default currency to get things rolling steadily.

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The idea of a single currency is less complicated. If players had the ability to create their own currencies, we'd have conversion issues.

I think it's better to start off with one default currency to get things rolling steadily.

This idea was greatly implemented into the Star Trek Franchise even tho in the lore, money was not "relevant," for lack of better word, the Federation had "Federation Credits" as its means of trade, but not all species used the same currency or accepted that currency, thus leaning into the comment from KlatuSatori.

 

The way I see this, a universal currency would be more beneficial if you take the current lore Dual Universe has, to mind. Earth is gone, one must start over. Maybe commodities can be used as an initial "currency" to trade between initial planets, and then expanding into that "universal currency."? Who knows!

 

But, well have to wait and see, right now I lean towards both multiple and single types of economic currencies.

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I don't think the complexity lies in the conversion. To simplify things, on the trading market, make buyers and sellers select a single currency that they will trade their good/goods in. When browsing the market you select a currency and item and you can see all the buy and sell orders for that item in that currency. There'll be a drop down menu to switch to a different currency to see if anyone is buying/selling the item in other currencies.

 

In addition to that you have a currency exchange market. It is exactly the same interface as the normal market with buy and sell orders, except here people trade in currencies. In fact it wouldn't even need to be a separate market. Currencies would simply be other items that you can search for on the market and buy and sell.

 

What would happen is local markets would see a small number of currencies become dominant and most people on a localised area will trade in one of two or three currencies.

 

The complexity comes in deciding how players and organisations set up a new currency. For currency to mean anything there needs to be a finite amount of each currency in circulation. A player or organisation, when setting up a new currency would need to standardise it against some particular item and then distribute their new currency in exchange for quantities of that item.

 

As comrademoco says, it makes sense to have a default currency that players start with and might be the only currency allowed in the arkship protected areas. But it also makes sense for large organisations to want to create their own currencies as this brings control and wealth.

 

Anyway, it was just an idea I had. I realise it complicates the economy and would require more detailed thought put into it than I have done so far. But it would also allow for more diverse trading opportunities, niches and potential career paths for players, complex economic warfare between player organisations, hyperinflation, etc.

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Multiple currencies would make the game more realistic. But, creating a currency should be limited to big organizations. It's easier for them to spread their currency through trades and make it a custom. Newer organizations will not have such a wide spread currency, initially. I'm thinking of starting with a single, universal currency, or a commodity (as comrademoco mentioned) and introduce more later when an organization is powerful enough to do so.

 

Also, should conversion rates be disregarded completely? It'll be simpler, but less realistic.

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Well the conversion rates will be player-led, dictated by the best buy and sell rates on the market. The only thing missing is allowing traders to accept/offer different currencies for the same item on the market but that could easily be added. What isn't clear is the exact process by which a new currency can be created and how more of an existing currency can be introduced into circulation. I would say allow the creation of new currency to standardised against one or more market items at a set rate and percentage - or against absolutely nothing at all (kind of like how it is in the real world...).

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Currently, there is no plan to enable players to create their own currency, for several reasons:

- Risk of imbalance: If there is something that needs to be stable for a sandbox game, this is the in-game economy. 

- Development priority: Many features are quite long to develop (even the basic ones). And as this type of game mechanics implies a complex game design behind it in order to work well, it would cost a lot of development time. And for now, it's far from being in priorities

- Fun to play: We are not entirely convinced that enabling players to create their own money would be fun on the long run, nor really very easy to understand and master for most of the players (look how the economy in real life is complexified just by that). While we don't want to go "mainstream" in the game design of Dual Universe, we don't want either to go for a game that will only appeal to a very small population of players. We also need numbers to create a MMORPG full of player-driven stories! ;)

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You keep reminding me of the good things about Star Wars Galaxies, that is a very good thing.

 

You just bumped a thread from a year ago with nothing relevant to the topic ?... 

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You just bumped a thread from a year ago with nothing relevant to the topic ?... 

 

That is fine. Live and let live. I've heard excellent things about SWG, so those who wish to relive those moments from a long past game can freely do so. I'm assuming SWG had quite the in-game economy, so there's no harm in drawing a comparison. DU can take elements from that and improve on them. The process of evolution, isn't that exciting.

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Im curious about when they will give us more information on what they are thinking for natural faucits and sinks for the currency since it wont be player controlled. 

 

This also, I mean what natural sink could there be when the only NPC we know of is most likely a AI in the starting Arkships..... wait a tick.... what if we mine the currency such as 'gold' for a example and we have to use this gold to build some of our machines and such. That would give us both the way to get currency and the sink that it will go into. Also would give us a reason to build big-ass machines to dig into the earth looking for more of it all the time. Purpose to leave a planet when it's run dry and not just stay in one place..

 

I still wonder what the currency is thought and what connection it has to what the players plan on doing.

 

nora,

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This also, I mean what natural sink could there be when the only NPC we know of is most likely a AI in the starting Arkships..... wait a tick.... what if we mine the currency such as 'gold' for a example and we have to use this gold to build some of our machines and such. That would give us both the way to get currency and the sink that it will go into. Also would give us a reason to build big-ass machines to dig into the earth looking for more of it all the time. Purpose to leave a planet when it's run dry and not just stay in one place..

 

I still wonder what the currency is thought and what connection it has to what the players plan on doing.

 

nora,

 

My goal is to become a big-time trader from early start in the game by building and selling useful (scripted) tool and transport constructs. To help with this, I am mulling over the idea of creating a small "Resource Token" construct (the size and shape of a coin) that players will be able to trade with me at any time for product.

 

For example, I might not have a lot of money available at game launch, so I would give out these "resource tokens" to other players instead of money for the resources they give me. Later, once I have built items for sale, I would allow players to trade the resource tokens for finished products instead of game currency..

 

In essence, my resource tokens are suddenly an alternate form of currency that players can trade on the game Markets for game currency if they so desire.

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With multiple currencies, it is just an issue of supply and demand, anyone could create their own currency and just say that they own some amount of it, but unless it can actually facilitate the purpose of trade, i.e. someone else will accept it in exchange for goods then you wouldn't sell your own goods in that currency. Multiple currencies are exchanged just like other commodities, so if there were multiple currencies you could chain a transaction with the exchange rate to quote in any currency you want. The exchange rate depends on the relative value of the currency, and the bid-offer spread will depend on how many people actively use it, so if no one else used you wouldn't be able to exchange it anyway.

 

While multiple currencies would be interesting and probably lead to some interesting gameplay I would be far more interested in market exchanges that offer futures, options and swap contracts on commodities as well as bond and equity markets. This seems to be the point where most game economies stop, since there is no explicit support for it there is the issue of credit risk, but it sounds even without explicit support some scripting could be done to lock away funds in margin accounts. 

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It would be awesome to have a set of tools - or to allow players to design a set of tools - that automate buying/selling. In the real world it's not that hard since it's usually just a conditional trigger on the price. If price = x then buy/sell an amount at price x (or even price y). Then you could have a "real" market, and "real" trading. And of course stockpiles of the article being traded. Stockpiles that could be raided, perhaps...

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