D&D Economics

[reanjr]

I'm not so concerned about the effects of magic on an economy or the realities of varying coinage, etc.

What boggles me is the role of dungeon loot and the impact adventurers would have on a local economy.

My group is playing the Dungeon mag Adventure Path series right now, and it seems like we are constantly unloading hoards of crap onto the Cauldron populace. The amount of jewels, artwork, armor, weapons and other goodies we've been hauling out and trying to sell couldn't possibly be absorbed by the locals.

Our DM has been pretty good about adjusting prices to supply, but I can't help thinking local demand would been satiated on our first haul. For the sake of the game, he has -- probably wisely -- glossed over that nuance.

Likewise, I wonder where all this loot come from in the first place, how come nobody really noticed it missing, and how its removal from local circulation and into a cave failed to produce even a blip on the local economic radar.

Although some suggest ignoring these paradoxes, I find these kinds of issues to be a fascinating part of games' efforts to model imaginary worlds. For me, grappling with the problems only leads to richer campaign settings and spawns adventure ideas.

Carl

Can't answer where the loot came from, but as for what happens to it, I would imagine the town has had a huge boom in exports and a large swath of its citizens have moved into moneychanging and shipping. The merchant class would boom, while the lower class would find that with so many leaving their field they can charge more for their crops. Overall, the entire town has become wealthy. Over time, because of this, people will begin to move to the area hoping to find their own riches (a bit like the gold rush). Unfortunately, once the PCs move on, the entire economy will collapse and most of the town will be left poor and destitute. The farmers would probably be able to recover, especially if they bought up land from those who left their positions. Some of these farmers might become almost like local land barons, holding huge tracts of land and leasing off portions of it for others to farm. The merchant class, especially those who recently moved to the area, would be the worst off, not only because they are out of work, but because they probably got used to a most lavish lifestyle. Some craftsman in the area probably received a surgance in work from the PCs themselves. While this wouldn't be such a great boon as the merchants, the craftsman may well have honed their craft to an astounding degree, making their wares sought for miles around. Just some ideas...

 

[reanjr]

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.

I call this subsidy farming. As in, these people harvest subsidies from the rich soil that is the government.

 

[fusangite]

Now, let's say fighter's used up all of his score, but after a recent dungeon raid, has a few items that are unclaimed by the party. He gives one or two as gifts to the king as he makes his audience, and asks "Magesty, I was hoping that you could help me. My family has been displaced, and I need your favor to find them a new home." The king is so impressed that he sets them up with as good of a household as those items' worth tranferred into gold can buy.

The downside of all of this assumes that there are some large, powerful entities (guilds, kings, churches, Wizrds, planar creatures) that the party is willing to work with, accept gifts, and can give stuff back.

The campaign in which I am currently a player runs very much like this. I think it is an excellent, very workable solution for the problems this thread poses. Your handle is well-deserved.

For people who want to get a sense of what happens when gold flows into an economy that cannot really handle it, I recommend looking at 16th century Spain and 10th and 11th century Scandinavia.

 

[reanjr]

How about it wasn't hand waved, it was all talked out? Determined? Over pages and pages of debate? That the spells in the PHB are focused on individuals and that there simply aren't enough spellcasters, even with wands to keep keep disease down.

That's an absurd conclusion. A town of 500 could be nearly wiped out by plague without a cleric and spread the plague to 7 nearby towns. A cleric could stop it at less than a dozen deaths, if that.

 

[reanjr]

Magic items may have some of the qualities of money, but they lack others. In fact, they're a bit like jewelry or art -- they're valuable, and they retain that value, but they're not easily divisible, they're exact value isn't obvious, etc.

The major problem I see is that you have to spend 100gp just to find out how much it's worth. It's not even worth identifying potions as a vast number of them are cheaper than the identify. This cost of determining value would seriously hamper the exchange of wands, which are worth it (if fully charged) but its personal value to you would decrease by 100. Then when you sell it, you'd have to recoup this, but the buyer would want to decrease it because he has to identify to figure out if its worth it.

This CAN be fixed in the following way (which has its own problems).

Writ of Authenticity
This small piece of parchment has a coal drawing of a magical item on it. Each Writ of Authenticity is keyed to a particular magic item and a particular owner. The owner, by speaking the command word and touching the parchment with its keyed item, causes text to appear on the parchment. It is not in any normal language, but anyone reading the parchment will intuitively understand the properties of the keyed magic item as if they had cast identify upon it. The owner may key the parchment to a new owner by speaking a different command word and having the new owner sign the parchment. The signature of all owners of the parchment can be read when activated.

Minor Divination; CL 5th; Craft Wondrous Item, identify, arcane mark; Price 150 gp; Weight 1lb.

 

[reanjr]

Speaking of economics, I've found a curious thing in my games.

Players won't hesitate to spend large quantities of money on magic items, when they are available for purchase, but they'll totally balk if I charge more than 2gp for a room at a classy inn. I've tried charging like 10gp for a room before and the players are like "that's crazy!" Despite them having thousands of gold coins to their name.

Anyone else seen this?

In a game I played in, yes. The inns in my games don't ever cost that much (unless they are really nice).

 

[reanjr]

Tell them that the 10GP room comes with a Changeling hooker.

That's a steal!!

 

[Dr. Strangemonkey]

From a purely practical and gamist perspective, there is one major obstacle to the creation of a 'rational' DnD economy.

Namely that the entire magic item side of the economy functions as an essential point-buy system layered on top of the normal class and level structure.

GPs and nearly everything valued in GP really have almost no economic function whatsoever, what they really are are a neat term for said point system. Gold pieces are a very concrete and contextualized way of naming points. Mind you, they become extremely complicated as a result, but it's made up for by the fact that finding gold pieces is, in many ways, far cooler than simply being awarded hero or power points.

So the first thing you would need to do to 'fix' the DnD economy is create a new means of evaluating and tracking magical items as part of player power. One that was/is entirely without exterior economic value, because the bottom line is that none of these things would be as valuable to anyone as they would be to adventurers and that would likely reduce the cost which would in turn entirely destroy game balance.

Once that is done, then you can go ahead and simulate away with whatever economic model or theory makes you comfortable, though you would still have the rather sticky and difficult issue of magic to deal with. Not to mention that levels and high level usages are going to represent a rather odd economy in their own right regardless.

 

[Viktyr Gehrig]

Tell them that the 10GP room comes with a Changeling hooker.

And the conversation comes full circle...

 

[Kid Charlemagne]

So the first thing you would need to do to 'fix' the DnD economy is create a new means of evaluating and tracking magical items as part of player power. One that was/is entirely without exterior economic value, because the bottom line is that none of these things would be as valuable to anyone as they would be to adventurers and that would likely reduce the cost which would in turn entirely destroy game balance.

I don't see why that has to be the case. You seem to be saying that if there is low demand, prices will drop; but my assumption is that if there is low demand, production will drop, achieving the same result. Now, clearly there are pre-existing magic items, but unless a large hoard of them is found, that won't affect the market. And the market is so small and specialized that it can be dealt with almost entirely seperately from the "normal" market. It's like the market for $50,000 watches today. Hardly anyone needs them, but they're still out there to be bought.