Urgent Economy Flaws

[MasterEel]

To whomever it may concern,

There is a prominent flaw in the economy and it’s suggested pricing. A curry is currently charged at 650 per stack. Whereas a lower price berry stack (lansat) is charged at 83. It takes 10 stacks of berries to make 1 stack of curry. Why is there a deficit for the producer? The minimum charge minus effort and time to produce, should be about 830. Why does making berries into curry, depreciate the value of the individual berries?

On the surface of may seem like it’s just a simple mathematic issue, but it’s actually creating a very extreme and monopolistic economy. Too much depreciation, is cutting many relatively less ‘dedicated’ or newer players out of the economy. Unless these curry producers dedicate inefficient amounts of time to create something at a deficit to earn a depreciated amount of money, it is very likely that monopolies and money controlling will soon occur. There has to be a difference between ‘hardworking’, and ‘working a lot inefficiently’. Currently in this server, this logic is not present. This causes most undercuts to be near impossible and detrimental to the producers, as there is absolutely no systemic economic control or consequences on the supply and demand chain. I can help think of countless ways to set up a underlying system for the economy to improve in becoming infinitely sustainable, having a better balance between hardworking and efficiency, as well as luck. This will also provide a adequate safety net in order for players to all have a better time to enjoy the game to its full, and not have to worry about grinding in a time=loss trend for the sake of earning coins.

I have completed economics courses in university prior in the last few years so I am able to spot an unstable (not related to sustainable) economy when I see one. I have plenty more examples of this so please dm me on discord to discuss further suggestions.

Pls contact MasterEel on discord and MasterEel719 on Minecraft.

Thank you for your time and patience.

[TheDootApp]

Hi there, atm i am also part taking in an Economics course, but I too have been shown the process of making curry, It takes quite a numerous amount of hours and effort to produce quite a lot of curry.

The berries itself are really easy to get (You can literally farm them) When harvesting the berries, u always get more than 1 per harvest, so its realistically checking latest /cost or current market costings is just irrelevant, so if you are saying you've done economics, you'd know about the basics of Supply and Demand. over excess of supply (example, Lansat berries) = lower price to entice for higher demand. Businesses and in pixelmon terms, players; are profit maximisers, they want their money NOW, not 5 days later where it could be sold at a higher price

The Price tag of 650 is also able to entice costumers to buy it as its a reasonable price for both new and advanced players, whats the point in making curry almost inaccessible to newer players? lets take Celtic for example, frickin lad makes TONS of money from curry, why would he be running a business that is making profits? Clearly the businessmen are making profits from this.

i think for the value of 650 dollars for 200000 exp to be quite the bargain. I honestly do not think your accusation of curry being a monopolistic economy in itself is accurate, there have been quite the amount of different people selling curry each and its all at the same price because it is able to produce a profit. Celtic and Sygles currently are just the main ones selling it atm as other sellers such as nuboi and Nickymon do not have the production capacity to match that, therefore resulting in less being sold. The price of 650 for a stack also helps many other businesses, such as myself as i mainly create battle ready mons for the competitive scene, increasing this price would be ridiculous as it could affect pricings of battle ready's and or turn the process into a much longer effort as to keep price stable, do it manually.

One main important thing tho, Free economies exist for a reason, having money controlling for such an OP item is actually really balanced imo. Its "just" out of reach for new players and readily available for those with established businesses. So unless Jay adds protectionist policies upon the market, idk how this gonna be fixed

This is just my view tho
Thanks
From TheDootApp

[Celtic_Centurion]

I'm going to focus on the curry side of things for this matter, as its either a crappy example or your general perception of how the economy functions is incorrect. Please note that I am not inferring that the economy is flawless or even highly functional merely stating that your perception of how it operates is malformed.

I can reassure the matter that:

1) Your arithmetic is flawed beyond all hell, using the /cost of a stack of lansat berries is a flawed notion to use in calculations as generally anyone with any interest in making a presence in the curry market will farm there own berries. To think or do otherwise is simply inefficient entirely.

2) Its also flawed to assume that 10 stacks per 1 stack of curry is in any means a fixed rate considering I've had various methods utilizing ingredients and other unique berry combinations to achieve "charizard-class" curry.

Before I go any further, consider the 2 notions below:

How can the conversion of berries to curry depreciate the economic value, the simple answer is, it doesn't, as technically if I plant the berries and harvest them myself, where is the monetary loss in this instance?

Are the berries truly worth that much? Is /cost by any means reliable across the entire market? And what made the berries that price? I don't remember anywhere in economics where the berries actually sold to real players, unlike the curry which does sell.

3) The economy exists on the notion of supply and demand, its illogical to expect anything different. And in a supply and demand economy, desirability of a product is key, people are not going to buy a DIY Curry Shulker containing 10 stacks of lansat berries. They will buy the curry however, as one is useful, the other generally is far from useful.

4) No one ever stated that the curry marketeers were inefficient, if you are somehow that's your issue, however I can reassure that in my 10 months of making curry on the server, I am efficient and my colleagues (particularly Sygles) are also well-trained in the techniques I use to accelerate the efficiency of the overall process.

5) To suggest that curry is the core source of the disassociation of new players in the economy is a mildly moronic notion given that I refuse to sell for 650 or above. With the intention of not destroying the experience of new players.

So consider the following:

If a new player could buy a stack of curry for lets say 350, is it by any means rational for a new player join the server and within 5 minutes have a Pokemon as high as level 70?

After some calculations with other seasoned players on the server we estimated that up to 90k is injected into the servers economy every 24 hours (from completely renewable sources).

So with all respect, even if the economy experiences a large degree of fluctuation in value, would it really be any fun if it didn't?

[Bolt]

Hello, I'm Adam Smith (inventor of modern economics btw)

I am here to say I think the points you bringing up are not the core defunctioning part of the market. The market was/isn't built on the back of slightly selling a manufactured product for cheaper than the objective cost. Your argument of the effective cost vs actual selling cost is not sufficient enough to be considered an issue, on the scale you assume it is. Curry is widespread and has very little restrictions to selling abroad, its a widely used good and sells well within the current economy. Before curry was pioneered and optimized, rare candies were our only options and now that berries can get you 200k EXP for 650$ I don't see the reason for this argument. All you need is berries, it's not like curry is some ultra exclusive item and only certain people can produce it. In my opinion, if you wish to debate the economic state of the server adjust your attention to previously nerfed pickup loot tables, that provided a forefront to entry level goods with a high sale rate.

[MasterEel]

Hi TheDootApp.

Thank you for your input.

I understand your point to be completely valid from your opinion. However, I do find some fallacies in your argument.

1) My point is that the curry’s set price (the price it tells u when you type /cost) vs the lansat berry’s set price should be changed, as it does not make sense to sell berries at 80 when they are so easy to get and mainly useful for curry anyway.

2) I believe that the fact that a player like Celtic is gaining a monopolistic or at least oligopolistic control of the curry scene. Requirements for a Monopoly system from an economic point of view is a) it is very difficult for newcomers to enter the market of this similar product, and b) if the only few (or one) people selling it are making money and in control of the market in sales. In both these examples, a player aforementioned like Celtic or Sygles would fall easily under that category. If you reckon that other players have the ability to enter the scene for selling curries, then you may as well list the full requirements for people to understand. In a small addition, your statement and example ‘clearly the businessmen are gaining from this’ could very well act as an argument that supports a somewhat monopolistic system.

3) Looking from a different perspective down the lower buyer’s degree, if a new player were to enter the general market, how would they even survive? There are simply not enough variants in this economy on the whole, to be able to support a new player. Simply speaking, not every player is willing to spend hours fishing for super rods, BB grens, to make tens of thousands. And if there is a surplus of curry sellers like Celtic, who’s going to make the money to buy curry? A rough estimate of every hour from successful bounty hunts earnt, is only enough to buy 2 stacks of curries. And that’s serverwide every hour. Gold Amulets are disabled, so after battling trainers and refreshing every night, it’s probably about 200 dollar earning every night. Even after levelling your Pokémon up, defeating gyms don’t even pay a single cent (to my current understanding). So, who exactly are the lower end consumers? What do they do for a living? And what do they use the curry for?

4) There is absolutely no safety net to undercutting. In a real life economy, say for mine in Australia, there are hefty requirements for a severe undercut in sales of any produce. This stops people from selling things at 1 dollar and ‘getting their money now’.

5) I believe that your understanding of profit maximisation may be a little faulty when viewing this particular example of curries. Firstly, profit maximisation is the calculation in which businesses use to estimate the products value over time, in order to gain the highest profit. This doesn’t mean that the items will be instantly sold less than 5 days. Furthermore, profit maximisation does not mean time=money in a steady approach as you may suggest. For example I could sell my stack of curries for 300 and get instant money. But in a healthy economy, there has to be external consequences if I were to do that permanently, not including the natural production supply delay that may follow. There are many more variables to calculate the ideal point of how much curries should be sold. But my initial argument is that if lansats are sold (and they are all over the market atm) for 80 dollars and suggested at 83, then why are curries so cheap? This can very well cause indirect issues to the economy and the lower end buyer as I have previously mentioned. Secondly, there is no inflation in Pixelmon, or so much fluctuation in prices caused by nonexistent variables, therefore the price will not go up in 5 days time and nothing will be sold for ‘more money’ over time. The only way that something similar to that would happen, is when the supply of a pre-existing product has been depleted, and demand is still raising through the roof thus forcing buyers to accept the fact and buy at a higher price.

All in all, I’m not in any way saying that this economy is not sustainable as I clarified in the first article. My only point is that there could be a more defined balance and better market entrance levels, so that it would not become a fully oligopolistic or monopolistic economy. Supply and demand can only come so far if the equilibrium is not achieved and managed properly. A common misconception is that if something runs for a long time, it must be in equilibrium. Unfortunately in a relatively high RNG based economy like Pixelmon, it does not operate that way. The consequence over time is that its system can continue be in disequilibrium but still be ‘sustainable’. But that would be what I call an unstable economy. Now, wouldn’t reaching a equilibrium be more balanced and fun experience for all players?

If you have read to here the fruits of my effort, thank you very much for your time and I hope that even some tiny things can improve in this server for the better of the players.

[smok98055]

It looks like while writing this, the previous two people have had their way with you example of curry as a broken facet of the economy so I will be touching on the second half regarding the general server economics. To start with your premise that the server doesn't seem to have a reliable system of balancing the amount of work vs efficiency of the work, I'd like to point out that there already exists a difference in the efficiency of work. The existing gap between the amount of labor and the efficiency of labor can be described by a player's knowledge and their use of technology, both of which are both well known contributing factors when determining a player's economic productivity. To use the example of the curry market that you brought up, a massive reason Celtic is able to control the market and produce as much as he does is due to his intimate knowledge of the functions regarding the production of curry and the manufacturing infrastructure he possesses, which other competing firms do not possess to nearly the same degree.

On the topic of undercuts, yes, unless you can produce a good for a lower price than the preexisting means of producing a good (assuming that is it priced at a competitive market price), then undercutting the price will inherently result in lower profit margins and as competing firms lower their prices to remain economically viable, the prices will continue reducing to the point of being unsustainable. This is something that is natural in a free market economy and not really a problem as it keeps goods at a stable equilibrium price, and so the best way to undercut is not simply to lower the selling price, but it almost necessitates the increasing efficiency of manufacturing, which helps the server by creating a more efficient overall economy.

As it pertains to the server as of right now, I'd say that the labor supply/labor efficiency isn't exactly a large issue as many facets of the economy remain at a relatively low efficiency ceiling (ex. mining) which allows for newer and less established players to earn money (albeit at a less efficient rate than established players who partake in higher potential areas of the market), while still leaving much of the market up for optimization which allows for players to enter the aforementioned high potential markets and make it big while benefiting everyone else by driving down the price and increasing the overall supply of a limited resource.

If I had to point out a far larger issue in the economy as is, it would be the lack of the market as it stand, to manage the recessionary periods in the economy and stabilize massive fluctuations in the circulating money and asset supply in the event of a server update which would significantly alter the pool of available goods and services. Whether is be a influx due in part to decreases in the savings rate resulting in a surge to the pool of circulating money, of a change to the loot-pool of drops reducing the supply of an in demand product.

Seeing as you joined during one of the worst recessions in recent server history, I can see why you may see particular parts of the economy as flaws but I can assure you that for the most part, the economy is very strong and reliable on this server, especially in the areas which you pointed out.