Excerpt: Economies [merged]

[Counterspin]

Given that WOTC has revealed the math, I don't see what the problem is, or what medieval economics has to do with it. If you want to maintain balance that WOTC is trying to produce, but dislike the sale/vale ratio, just lower the value of the magic items you hand out by the difference. If you prefer realism and don't give a flip about balance, hand them out however you like.

 

[JohnSnow]

For most of European history, markups were disdained on principle (although obviously a tradesman had to make a living) and "easy financing" was called usury and illegal.

Nice theory. Care to provide actual evidence?

Things were marked up all the time. Nutmeg, for example, was sold in Europe at a 63,000 percent markup. That's 630x it's original price. Which is a little bit of a markup...

As I understand it, "usury" is defined as "charging interest on a loan of money." It wasn't illegal - it was just considered sinful for Christians to charge one another interest.

Which is why, for centuries, all the moneylenders were Jewish.

However, you are right, in a sense. In England (and some other places), "usury" was actually illegal. However, since they still needed moneylenders, to skirt that issue, all jews were property of the crown. Now there's no problem...because the crown (largely) gets to decide what the law is.

Sorry, I just don't buy the "nobody would get away with buying something at one price and selling it at 5 times that" argument. And no matter how much you protest that it's unfair, you, and others, have yet to show that it's actually unrealistic.

 

[Family]

And "easy financing" was called usury.

Paladins to ARMS the sinful usurers have once again breached the borders of our lands with their low low interest rates under their veil of "secure" storage of wealth!

But first I want to order this Holy Avenger from the Hudson's Bay Trading Company, anyone here have Yon PayPal?

 

[JohnSnow]

You mean every fighter of 3rd level and above would have a captured merchant vessel? I don't think the 1:5 rule is confined to just items worth as much as a ship (in fact, it's not if you look at the published table). Given the amount of magic goodies possessed by a typical NPC, based on level and demographics and such, magic items are fairly common and I think the merchant vessel analogy doesn't seem appropriate to me. The market for a +1 sword IMO is far more extensive than just the queen and the richest merchant guilds.

And let's say it's not. Then the next point of weirdness for me is that all of the arguments for a lack of sellers are used *against the PCs*. Wouldn't the supposed difficulties of selling a 100,000 gp apply to NPC merchants as well? And in this case, why aren't rich PCs able to pick up expensive magic items cheaply, so as to spare all these poor merchants the misfortune of owning 100,000 gp items?

Using the 3.5 PHB, and knowing a little something about the middle ages, by medieval (or even renaissance) standards of living, anything over about 1,000 gp is the province of the rich or very rich. Moreover, anything costing over about 20 gp is the province of the well-off.

A simple sword cost the equivalent of a car back then. (By the way, that means swords are grotesquely underpriced in D&D). Sword, lance, plate armor and a horse? Now you're talking about the medieval equivalent of a Ferrari - bare minimum. That means anything over about 1000 gp is out of reach of all but the very rich. And even a breastplate (200 gp) should be considered a truly "luxury" item.

In other words, any item over 200 gp probably can't be sold to 90% of the population. And any item worth 1000 gp or more probably can't be sold to 99% of the population. And so on. And that's being generous.

But sure, a +1 magic sword (assuming it's a "level 1" item; cost: 360 gp) probably has the same market as a heavy warhorse (cost: 400 gp). Or a bit larger than that of a carriage (cost: 100 gp) and its team of two heavy horses (cost: 200 gp each).

For comparison, a cart costs 15 gp. A wagon costs 35. These things are the prize possessions of the average peasant. That light horse costing 75 gold? He's the prize possession of a pretty well-to-do person.

In other words, comparable to a warhorse, the only market for magic items is the rich and the very rich (or, in some cases, the government).

 

[gizmo33]

then you're assuming that the merchant is dead certain he can sell that sword for 10K without paying anything out of pocket.

No, I'm assuming (based on labor and goods prices for 3E since I haven't seen those in 4E yet) that the costs of such transactions would be reasonable. 5,000 gp of bribes, security, etc. is not reasonable IMO. I'm not aware of any DM that has ever charged a 50% luxury tax on all magic items that PCs brought with them into a city - though I'm sure there is some insane example of that somewhere.

As you request, a brief extract from Charles D'Avenant's "An Essay on the East-India Trade", 1697.

Exactly - thank you. Now I'm starting to read your example on the spice trade and right way I'm suspecting I'm going to see something on long-distance shipping, and monopolies, etc. No one is arguing that the adventurer is in India, and the market for the +1 sword is in England. So the analogy seems to me to be based on the situation of the adventurer who is already sitting in the city in which he wishes to sell his sword - and now somehow the involvement of a single merchant turns it into a 1:5 transaction. What your analogy would need to demonstrated was that someone calling himself an "adventurer" in Holland was forced to sell pepper for the price of dirt.

Note too - the part about "is of such general use". This is talking about supply and demand. This means that an adventurer with a pound of pepper in a sack could sell the product for a good profit because of high demand. But somehow this exact logic gets turned on it's head and is used to justify why the adventurer would have a *difficult* time selling his +1 sword. If you're arguing that the demand for a +1 sword is comparable to what you're describing for pepper, then it's a whole new argument.

The profit on one pound of pepper after transportation? About fourteen and a half times what it cost to bring it.

Well the merchant better not call himself an "adventurer" or then he'd be forced by the DM to sell the pepper for 1/5 of it's market price. Again, the market price difference between India and Holland/England whatever is not relevant to the core transaction we're talking about. None of the demand forces that are driving up the cost of pepper does anything to keep the PC adventurer from being ripped off and finding himself in the world where one lone greedy merchant seems to be his only customer.

for it is against the inclusion of a sumptuary law that would prohibit the export of many luxury goods to India,

As has been pointed out earlier in the thread, a +1 sword is probably not a luxury good and there is no indication that PCs are being taxed at 50% on magic items that they bring into a city.

But in a larger sense, it's certainly true that the grain merchant wasn't usually making 3:1 on wheat- albeit in the fourteenth century, English grain prices varied by up to a factor of four- but PCs don't sell magic swords to commodity brokers. They sell them to gentleman adventurers like those of the East India Company.

But again, a well timed purchase of grain during a time of plenty and a sale during a time of famine can reasonably get you 3:1 or whatever. However, at what point is this analogy relevant to the sale of the +1 sword by an adventurer? And if there was suddenly some extreme shortage of +1 swords, and a high demand for them, why in the world would the average (with decent Diplomacy skill) adventurer be completely incapable of getting a reasonable price for his goods?

I really appreciate the facts that you've provided for me to consider. However, I think the next step is to draw the appropriate correspondances, and the conditions that your facts describe IMO do not completely enlighten me on the nature of an adventurer selling a +1 sword in a city.

 

[Tervin]

Am I missing something here?

Isn't all of this a discussion of the economy of magic items in a fantasy world, of the DM's making, choosing or tweaking? How trade of such commodities is handled in the parts of the world where the PCs travel is basically the DM's decision, as long as it is acceptable to the players. Whether magic items are easy to buy and sell at certain prices depends on culture, which is clearly something the DM can choose. A 500% markup is unacceptable only if the world is made in a way that makes it so.

I have DMed a few hundred players, and I can't remember a single one who thought I didn't have the right to decide how the system of economy worked in the game world. Which to me makes the whole issue be about what the DM prefers. This system is in my opinion clearly superior to 3.x, as it should be much easier to keep the players at a reasonable power level.

(That I myself dislike the whole concept of buying and selling magic items through merchants is another matter - a personal preference that I will have to make a work around for or simply give up, depending on the type of game I want to run.)

 

[Counterspin]

Tervin - The disenchanting rules are being included just for people like you, so that you can do away with the buying and selling of magic items.

Everyone else - And I will repeat myself. We know the numbers. The numbers are important to balance. If you care about balance, you can shuffle your numbers to fit any standard model and maintain this balance. Arguing about where the bar is "realistically" is asinine, because we already have the tools to compensate for any rate. Which is good because clearly no two of us think the same rate is "realistic."

 

[JohnSnow]

As has been pointed out earlier in the thread, a +1 sword is probably not a luxury good and there is no indication that PCs are being taxed at 50% on magic items that they bring into a city.

Not a "luxury good" in what sense? It's useful? So's a warhorse.

But it most definitely is a luxury good by the metric that really matters: price.

A +1 magic sword (assuming it's a 1st-level item) retails at 360 gp. If we assume nothing has changed in equipment pricing (a big assumption, I know, but bear with me), then it's almost the price of a heavy warhorse. Which means it should be purchasable by about the same percentage of the population.

That means "royals, nobles, and well-to-do members of the middle class (including adventurers)." That's what....1 percent of the population? Less? And that's a 1st-level magic item. As you go up in levels, it only gets worse.

And you misread the article. It says the PC can easily unload the item for 20% of its price to a passing merchant in any village. They could go through the effort of finding a buyer themselves, but that takes both time and effort. And in the process, they earn every copper of that extra gold by the hoops they have to jump through.

The point is you just can't sell a magic sword by putting it on eBay.

 

[gizmo33]

A simple sword cost the equivalent of a car back then. Sword, lance, plate armor and a horse? Now you're talking about the medieval equivalent of a Ferrari - bare minimum. That means anything over about 1000 gp is out of reach of all but the very rich. And a breastplate (200 gp) should be considered a "luxury" item.

A book I have called "Western Warfare in the Age of the Crusades" paints a somewhat less grim picture than what you have here. Chainmail in 14th c. England was worth about 2 oxen. Swords seem to me to actually be fairly cheap, there's an internet resource that handles this - though there are quality differences that don't exist in DnD to consider.

DnD armor and weapon prices though, are much higher AFAICT compared to "trade goods" (wheat, oxen, etc.) than their historical counterparts. I'll grant you that rich people would be your market for armor and such, but I would also suggest that there are a lot more rich people in DnD than you're imagining. Just look at the typical equipment list of a mid-level NPC and consider what the usual number of these persons are in any given settlement.

In other words, any item over 200 gp probably can't be sold to 90% of the population. And any item worth 1000 gp or more probably can't be sold to 99% of the population. And so on.

As I've said though, your considerations for supply and demand would work against the merchant as well, meaning that my PC should be able to buy magic swords for less than the market price seeing as that they are so darn hard to get rid of and that my PC is in such a priviledged position as far as his wealth.

But sure, a +1 magic sword (assuming it's a "level 1" item; cost: 360 gp) probably has the same market as a heavy warhorse (cost: 400 gp). Or a bit larger than that of a carriage (cost: 100 gp) and its team of two heavy horses (cost: 200 gp each).

For comparison, a cart costs 15 gp. A wagon costs 35.

In other words, like a horse, it's a tool for the rich and the reasonably well-to-do.

Not sure what this is worth, by a scribbled note I'm looking at says: "Frankish Ripuarian law valued warhorse at 12 solidi, about six times value of an ox and four times that of good mare." Now I've seen very high prices for warhorses in the books from the late Middle Ages, but these are specially bred creatures that you would not hitch to a wagon. And speaking of carts/wagons, 35 gp seems a lot for wood and iron costs based on the 3E numbers, but oh well. (10 gp = 100 lbs of iron IIRC)

I think a somewhat easier perspective to take on this is cost of living. You have a number of NPCs walking around with +1 weapons and it presents a certain picture in my mind of suppply and demand that doesn't look to me anything like "Queen and a few elite merchants". I also think of a typical merchant as someone pulling in earnings of far less than thousands of gp's per transaction.

I know my statements ere are all over the place in terms of subject, but none of these facts so far are painting a clear picture to me that supports this 1:5 rule.

 

[gizmo33]

Not a "luxury good" in what sense? It's useful? So's a warhorse.

The comparison is made to a wedding ring. The custom, in the US at least, is that people don't look for bargains on wedding rings. Someone earlier in the thread talked about "conspicuous consumption" and added some details. These circumstances don't seem to be a good fit for a +1 sword.

But it most definitely is a luxury good by the metric that really matters: price.

Actually the factors that contribute to the price of a wedding ring in the US "really matter" and aren't comparable to those that would apply to a +1 sword in a typical fantasy world.

A +1 magic sword (assuming it's a 1st-level item) retails at 360 gp.

(I think it's a 5th level item, but that doesn't impact your reasoning AFAICT)

As you go up in levels, it only gets worse.

Well only worse for the PC and not for the NPC merchant it would seem. I'm sure if I were to use your reasoning to argue why my PC should be able to buy a vorpal blade for a few cp I would not be successful.

And you misread the article. It says the PC can easily unload the item for 20% of its price to a passing merchant in any village. They could go through the effort of finding a buyer themselves, but that takes both time and effort. And in the process, they earn every copper of that extra gold by the hoops they have to jump through.

Well if my thoughts are based on a misreading then why the argument? Why are there so many posts in this thread that are trying to make the case that 1:5 is generally reasonable? If the 1:5 is based on a certain set of conditions that I would think it more productive to have stated those conditions from the start - instead of a list of anecdotes about spices and captured ships, et. al. that seem to clearly illustrate no particular consistent set of conditions. (Though I am very grateful for some specifics as opposed to the otherwise unsupported generalizations that I was getting prior to that.)

The point is you just can't sell a magic sword by putting it on eBay.

Oh, well then I take back having said that. Oh wait, I didn't. I roll for initiative against the straw golem.