This is an interesting lesson for all you economists out there – how to lift a stagnant economy!
Basically, the wurm economy is in severe deflation. Most people work for nickles and dimes, even our most skilled craftsmen are currently satisfied with an hourly salary of max 1 euro or so.
Obviously people are content doing this and think that it is fair pricing. After all they have pretty much fun doing it and Wurm is a game.
I honestly don’t think they should be satisfied though. In other games you can earn a lot more money by selling ingame stuff and I think our players deserve that as well.
The main reason for the low pricing is that there is a shortage of money. I am 99% certain about that.
So what I want to do is to introduce more money into the economy. This way you will earn a lot more when you work. We recently introduced a way of doing this by submitting information to websites using a “rewardtool” in our coin mine. 70% of our players think that it’s a great idea, the rest are more or less negative.
So does the new money mean pure inflation?
The web definition of inflation is: “a general and progressive increase in prices; ‘in inflation everything gets more valuable except money’”
Now, the thing is that since silver coins are tied to the Euro, every silver coin still is worth the same. Buying one euro via paypal will still cost the same. Selling it at Ebay should still cost about one euro (actually it sells for less). Eventually, one day, we may be able to let you withdraw your money for real money. Then every silver coin will still be worth 1 Euro.
So there is only price increase. No real inflation, just perceived inflation as prices go up. This is the same effect you get when your country is exporting goods – your country just gets richer.
Now, this is actually what I am aiming at with this whole post:
Currently everyone is working hard to pay their premium and deed upkeep because there is so little money in fluctuation. It’s a seventeenth century serf economy. A percentage leaves the system via tax every trip to the traders so unless more money is inserted into the system there is deflation which is the normal state of the game.
In deflation everyone is afraid of spending because next day you get more for your coins.
Now, I’ve realized that there is a limit somewhere where the system lifts and turns around.
Given that we pump in a lot of money into the system, people will earn more and more and don’t have to be so obsessive with their small earnings. As prices increase, more people will put smaller percentage into premium and upkeep and start trading instead, distributing the wealth.
Since prices are higher, more money will enter the economy as well via paypal or the rewardtool. To me this represents income from exporting goods and services.
So, basically the limit where the economy lifts is where a majority of people have a surplus of money after basic living costs are covered.
Now, shouldn’t I print money by simply increasing the number of silver at the traders in the database?
Maybe I should but it doesn’t feel right. That surely constitutes real inflation and makes all existing coins less valuable without strengthening the gold reserve value, which is the company economy.
It would probably have a positive effect and be worth it in the long run as the scenario I described above unfolds. A state probably should do it. But we’ll keep with the line where the players contribute to the economy themselves and provide silver via the web shop.
So there – my version of economy class grade A served on a silver coin!
