D&D Economics

[SWBaxter]

This happens all the time today. Farmers have a bumper crop, and suddenly what they were selling for $25 a bushel now only sells for $12. Their crops are growing better than ever, but they're making less money, because everyone's crops are growing more. This is why the government pays farmers to NOT plant crops.

Sure, but this happens in modern times because our ability to produce food far exceeds the demand in first world nations, and in poorer (and hungrier) areas there isn't enough wealth to make it profitable to sell food to them. Quasi-medieval economies are unlikely to have those characteristics, even in the comparitively small area in which food can be transported before it spoils. More fully magical economies might, though.

 

[S'mon]

I remember that there were some articles about econmics in D&D in White Dwarf many years back (1980-something) which tried to make sense of things a bit. I think it is hard to talk about realistic economics in D&D and looking at a real world model without taking into account the unrealistic amounts of coinage in the game world and the effects of magic.

I use those "Designing a Pseudo-Medieval Society" and "The Town Planner" in my own Ea game. They explain why labourers need 5 sp/day (not 1sp). By and large I haven't found it hard to get a rough semblance of logic from D&D economics. Listed magic item prices are internally well balanced, most PHB equipment isn't too bad (though bows are very expensive). The only thing I recall being an order of magnitude wrong was the building prices in my 3.0 DMG; eg a mundane tower costs far more than a Drawmij's Instant Fortress (or whatever - Daern's?). IMC roughly quadrupling mundane NPC wages & reducing building costs by a factor of 10 has produced something workable.

 

[Kid Charlemagne]

Sure, but this happens in modern times because our ability to produce food far exceeds the demand in first world nations, and in poorer (and hungrier) areas there isn't enough wealth to make it profitable to sell food to them. Quasi-medieval economies are unlikely to have those characteristics, even in the comparitively small area in which food can be transported before it spoils. More fully magical economies might, though.

My point was in regards to the Plant Growth spell increasing production by 33%. That kind of increase would cause prices to drop. I'm sure that price fluctuations like those that happpen today happened just as often in medieval times. Good years and bad years for crops are nothing new.

 

[Azgulor]

Due to a recent thread, I've been looking at economics as presented in D&D. It's already well established that they don't make sense, and that they're broken and stupid in general. Some products make this even worse, by pricing things in entirely unreasonable fashions.

Is there any sourcebook that makes a reasonable attempt at fixing this mess, by providing realistic wealth guidelines per level and making the prices of goods and services make consistent sense? Is there any way to adjust the magic level of a campaign by comparing the price of magical items to big-ticket mundane items?

The more I look at this issue, the more it's driving me absolutely insane.

Yeah, it drives me nuts too. Unless you're interested in doing the research yourself, I'll suggest the following (although it involves obtaining books you may not have an interest in if you only play D&D):
Option A: Conan OGL uses a silver standard. Also, swords are much more expensive than, say axes, which makes sense due to the amount of metal and the level of skill required. Obviously, if you're only interested in the prices, go for the Pocket Conan version, a 2nd-hand book, etc.

Option B: As someone mentioned, MMS: WE tries to make sense with the nonsensical and within the D&D framework, succeeds.

Option C: Also regarding MMS: WE, on the publisher's boards, the author cited a rough approximation of 115 gp / English pound. So if you want to convert to a cash-poorer model that uses silver pennies and copper farthings, you've got a starting point. Better yet, however, both GURPS and Harn essentially duplicate the pound-penny-farthing model, so you could take price lists straight from those materials.

Azgulor

 

[fusangite]

Given that everything else is being rehashed, I'll chime in with my usual refrain that the best way to cope with D&D economics problems is to apply 12th century Christian Aristotelian thought to the subject.

To summarize, for Aristotelian thinkers, value was objective not subjective. Unlike modern theories of economics, value inhered not in the vendor or purchaser but in the physical object itself. An object was not assigned a monetary value by a transaction; the value already inhered in the object itself. Thus, a bushel of wheat was always worth the same amount of gold, irrespective of the supply and demand for both gold and wheat.

That's not to say that supply and demand didn't affect medieval prices; what they did affect was how people thought about prices. If one were paying more for an object than its intrinsic and unchangeable worth, one of two things must be true:
(a) the vendor was overcharging
(b) the purchaser was paying for services in addition to the object itself (e.g. transportation or storage)

By the same token, if a person paid less for an object that its intrinsic worth, he must be exploiting the vendor.

Both under- and over-charging were viewed as technically illegal and judicial processes did exist to assess the intrinsic value of goods and punish people who did not abide by these values.

One can see how money lending would be impossible in such a scheme because money now has precisely the same value as money later in this framework. Therefore, people who wanted to borrow and lend were required to make transactions with non-Christians who were not bound by these rules or they were required to break the law/sin.

While this does not fix the problems with the D&D monetary system, it does provide an framework for coping with the disparity between the intrinsic value of a good or service and the price for which this good or service can be exchanged. It also solves the problem of the mechanic assigning a fixed ratio of xp to gp in item creation and other mechanics.

 

[John Morrow]

That's not to say that supply and demand didn't affect medieval prices; what they did affect was how people thought about prices. If one were paying more for an object than its intrinsic and unchangeable worth, one of two things must be true:
(a) the vendor was overcharging
(b) the purchaser was paying for services in addition to the object itself (e.g. transportation or storage)

Actually, not understanding the function of middle-men or why they take a percentage out of transactions is fairly common throughout human history and it's not uncommon to find different ethnic groups around the globe that specialize in being middle-men in their little corner of the world being persecuted as evil because of it. Translated into a fantasy setting, if the Halflings dominate the money-lending business or Elven merchants make a nice profit marking up that silk they are importing from other elves back in the elven woods, you can be sure that it would trigger a predictable racist reaction from various groups outside of those cultures claiming that they are stealing from other people.

Both under- and over-charging were viewed as technically illegal and judicial processes did exist to assess the intrinsic value of goods and punish people who did not abide by these values.

You'll actually find fixed prices for various goods in several ancient law codes going back thousands of years. In fact, I've found that the exact same problems with middle-man service fees, floating prices, debt, and interest rates come up again and again as various groups try to demonize and stop them, producing results that are often not quite what they intended.

 

[DMH]

There's a great thread that I have bookmarked somewhere on the economy of magic items, as per the DMG guidelines, which was really neat. It showed that for a standard magic world there really isn't a problem with the magic side of things. I'll have to look for it when I get home, otherwise someone can do a search for Economy of Magic Items or something like that.

http://groups-beta.google.com/group...0d7a53e1a90/7e058b523663d1d2#7e058b523663d1d2

You have to read the whole thread to get a more realistic handle on the problem, as the original poster made a major mistake (not that it matters since the system is busted).

 

[fusangite]

Actually, not understanding the function of middle-men or why they take a percentage out of transactions is fairly common throughout human history and it's not uncommon to find different ethnic groups around the globe that specialize in being middle-men in their little corner of the world being persecuted as evil because of it...

You'll actually find fixed prices for various goods in several ancient law codes going back thousands of years. In fact, I've found that the exact same problems with middle-man service fees, floating prices, debt, and interest rates come up again and again as various groups try to demonize and stop them, producing results that are often not quite what they intended.

Agreed. However, the Scholastic Renaissance of the 12th century produced a much more coherent and well-documented economic theory for these views, and one compatible with D&D's physics as represented in the Appraise, falling damage and element mechanics. So, yes, government price controls are sufficiently common throughout human history to make it into the Book of Revelations as Famine but none of these schemes were pegged to a coherent and well-explained theory parts of which have already been imported into D&D.

My statement was not intended to illustrate any unique feature of the 12th century's public discourse on pricing mechanisms but rather to offer people a way of dealing with a D&D problem from a perspective amenable to D&D.

 

[Wilphe]

Ignore gold pieces, ignore letters of credit:

The very best way to store and transport wealth in a more or less standard D&D world is treat Magic Items as money. They have a much higher ratio of value-to-weight than any normal good are easily transportable, they are hard to make and are universally in demand. They also don't depreciate - unless they have charges and you set out to use them; but that's your option. A 100 year old wand of CLW is as good as it was 100 years ago.

Suddenly "Ye Olde Magic Shoppes" make much more sense (for people who are worried about such things) as they don't just exist to equip adventurers, but they are the banks, mints and moneychangers of the setting.

The only change from standard RAW would be that sold items would go for full price, not 50%, which might affect power levels. Otherwise you make it as simple or complex as you need

Option 1:
Really simple: Assume that mints (aka: Item Creating NPCs) create what is in most demand so that relative prices stay fixed.

Option 2:
Track different classes of Magic Items as various foreign currencies, with variable exchange rates between them. So, Staves might be worth 10% more than their nominal value and Wonderous Items 8% less.

Option 3:
Treat each unique type of item in the same way as a stock or share with it's own, unique, fluctuating value. This requires much more work - or not, depending how often you change the values. If there is enough trade and variation then you would have full-blown Magic Exchanges (In the FR these would be in places like Waterdeep and Eltabbar) with as much Square Mile or Wall Street flavour as you like…)
This is where tavern tales and bardic announcments go like "Cure Light Wounds Wands rose 68% on rumours of war; this pushed the "Cure Wands" index up 53% and contributed to a net rise of 10% in the wands index as a whole. Arms and Armour rose an average of 12% during the day"

If you are going to go with 2 or 3, you'd need to decide what to do Creation costs and XP expenditure. Personally I would always base XP cost on the RAW as a measure of the power of the item, but base manufacturing cost as half the market value (if an item isn't in demand it seems reasonable to assume that the materials you need to make it aren't either)

There is also communication lag to consider, modern financial transactions take place in a near perfect market; if swift global communications aren't an option then markets will adjust slowly and characters will be less and less likely to get 100% of the value of sold items as buyers have to take on more risk.

Mind you, you can make a world equivalent of Bloomberg or Reuters which has people with Permanent versions of "Rary's Telepathic Bond" cast on them whose job it is to communicate this information. I'm sure there are other magical ways to do this.


This might a realistc logcial consequence; but it isn't authentic medieval economics (see Fusangites post above for that).

 

[Wilphe]

Telepathic bond:

5 th level spell, cast by a Wizard costs (CL 9 x 50 gp) 450 gp

Costs 2500 XP to make Permanent.
An extra 12500.

Total: 12,950 gp - that's not cheap - but you get a working, perment two person link for the privilige.

Then, if you are employing humans - and it makes much more sense to employ longer lived races, you'll get 40 years of work out of them; provided you pay them enough to stay healthy and ensure that they stay out of trouble.