[MUD-Dev] Economic Growth (Was: [STORY] Story and population size)

Timothy Dang tdang at U.Arizona.EDU
Thu Dec 6 14:43:22 New Zealand Daylight Time 2001

On Wed, 5 Dec 2001 Daniel.Harman at barclayscapital.com wrote:

> The next evolution in economies will require server based
> categorisation and valuation of all items. We need the npcs to
> compete in the economy on the same terms as the players, for this to
> work, they need to know supply+demand+value. Now I know this may
> seem difficult, but the trick is to set everything up in feedback
> loops so that errors are corrected not perpetuated. It doesn't
> matter if one npc buys a set of swords for the wrong value - players
> do that to. We just need to ensure that the npcs don't repeatedly
> make the same mistake. In this example, npc supply of swords has
> gone up, mean bid price goes down.

Ew! Yech!

I suppose I shouldn't rule out the possibility of this working. I've seen
robotic traders in experimental markets that do fairly well relative to
the real people in those markets, although the markets I've seen it work
for are both very simple and with very robust institutions (continuous
double auction).

But I still revolt at the idea. As I just said about "Respcting NPCs", I
think NPCs make good environment or institution, but I don't see much
value in making NPCs full-fledged economic participants. Players will
likely do a better job, and it's just a matter of giving them the
appropriate facilities.

If the goal is to provide an NPC outlet for easy PC buying and selling at
reasonable prices (and this is only one possible goal), then one should be
able to create an NPC-facilitated institution which serves this purpose.

For instance, have all NPC merchants wired together with a common
inventory. When I want to buy something, I check the inventory for the
kind of item I want, sorting for the lowest price. If I don't see what I
want, I enter a bid to buy it. Likewise, if I want to sell something, I
look for bids, sorting for highest price. If I don't see a good bid, I
enter an offer to sell.

There, without doing any fancy estimation, you could have a system which
allows players to empty (or fill) their bags for reasonable prices.
Thereafter, the challenge is tuning the costs for participating in the
system so that players still have the desired financial motivation for
face-to-face trade.

That's the NPCs acting as institution. There's also the NPCs acting as
environment. So, there may be some items which simply enter the economy
through the NPCs (could be the same merchants, acting in a different --
though largely indistinguishable to the players -- capacity). In this
instance, it's impossible to say except in an aesthetic way, whether the
price for something is right or wrong. That's the same kind of judgement
as "it takes too many arrows to kill an orc". The price an NPC charges
for something which is entering the economy (or pays for something which
is leaving the economy) is a law of nature, part of what *determines*
supply and demand for the item, not determined by supply or demand.

Not that I wouldn't like to see an effort to do this. It's possible that a
great deal could be learned (about econometric estimation in addition to
about the game). But it would take a lot to convince me that the estimates
could be part of a good control system.

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

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