[MUD-Dev] Broken Economies (was RE: Learning about MUDs)

Timothy Dang tdang at U.Arizona.EDU
Wed Apr 4 08:48:01 New Zealand Standard Time 2001

Dang! All this juicy econ talk and I've been too busy  to even read it
all, much less pipe in. Maybe this weekend. But here's one bit I can't

> Geoffrey said:
>> Actually, if my memories of Econ 101 serve, closed economies don't
>> even work on paper.

Econ 101 (or 697 for that matter) is mute on "closed economies" as
we're speaking of them here, because they don't exist IRL. When
economists talk about closed versus open economies, they're generally
talking about the degree of good, service and currency exchange. The
closed economy of early UO was a feature of it being a MUD, not
correlating to anything in the real world.

On Tue, 3 Apr 2001, Koster, Raph wrote:

> IMHO, the fundamental flaw in it in retrospect wasn't its closed
> nature per se, but which elements were closed and which were
> not. For example, organic matter, including mobiles, was in a closed
> loop and should not have been.

While I'm sure it's possible to design a closed system which will
work, there's things beyond the no-more-monsters problem in the
way. My main question is, why would one want to design a closed
system, besides to show that it could be done?

There are essential difficulties with a closed system. Ignoring
whether (and what type) of economic growth is necessary, the tragedy
of the commons will kick in unless there's some way to avoid it. If
people enjoy looting rings, and enjoy keeping rings, and there's a
finite number of ppossible rings in the universe, these two things are
going to be in conflict. Unless one can decentralize the incentives to
divest of rings, the tragedy predicts (I believe rightly) that people
will just hold on to the rings they've got.

There could be lots of ways to decentralize the incentives. Some kind
of big public kudos could be given to those who divest ("This week of
monster bashing brought to you by Soldiers of Light, who finally
cleaned out the garage!"). Alternatively, you could give people the
ability to destroy other people's stuff. Or there could be some system
to make sure that only those who divest actually get loot when they
hunt. Lots of possible solutions.

Or you can rely on standard source-and-sink incentive design, hoping
that that will keep things balanced. But that begs the question. Which
is, where is the gain? From what I gather, the hoped-for advantage of
a closed system is that it keeps the wealth, clutter, and databases to
a reasonable level.

But if you're capable of balancing the source and sink, then what's
the point of a closed system, since you've acheived it's goals anyway? 
And if you can't, are the drawbacks of the closed system worth the

I do think there are certain types of items which could be closed
without (too much) trouble. Certain unique or rare items could be
closed, because many folks will accept that they never get to loot/own
one. Currency could possibly be closed, depending on the involvement
of NPCs with the economy.

Timothy O'Neill Dang / Cretog8
One monkey don't stop no show.

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