Gold Sinks don't work

UO had, for a time, an economy without gold sinks or faucets; it was a closed cycle economy, where for a mob to drop gold, that same gold had to first leave the game somehow. The same was true for other resources.

End result, it didn't work. Players are natural hoarders, specially if they sense that something is scarce, so in short order most of the resources became locked in hoards, in the hands of players. Attempts to increase the limit merely delayed the issue, and UO finally was forced to eschew its old inflation-proof closed cycle economy and implement a common, faucets and sinks economy.

The issue is really thorny. Since it's a game, it needs to be fun for every player, or else the player might be inclined to just leave the game — which means that even the worst players at obtaining gold need to be able to have fun, which in turn means that players should be able to, in a way, ignore gold to an extent that would be unfeasible in the real world. At the same time, there are some players that are absurdly better at earning gold than the common players. Balancing a single system for those extremes would be, I believe, like attempting to make a competitive game that is engaging and challenging for both the worldwide champion and his grandmother. I would not envy anyone tasked with attempting this, and to the best of my knowledge only one game ever managed to achieve this: EVE.

BTW, the bit of irony in linking that article is that Blizzard basically gave up on having a working economy in Diablo 3, so they closed the auction house and changed the game to actually prevent players from trading gold or any worthwhile item. They figured their attempt at having an economy was harming the game more than the complete removal of the economy would.

 

That's not the only reason it didn't work in UO. UO's limited resources were unrealistic. Natural resources are either renewable or virtually inexhaustable for all intensive purposes. In UO if you killed a rabbit and didn't use up the meat, a new rabbit never respawned to take its place. So hording limited the respawn of resources.

When we talk a finite economy we're talking currency rather than resources. There's only ever a certain amount of currency but resources are always being collected and processed.

In short I don't buy the UO arguement that a finite economy "doesn't work" in games. This isn't UO.. we're not duplicating UO's resource management. It's the same as saying because we can sell to vendors that vendors are therefore an unlimited faucet. That doesn't have to be true. One doesn't HAVE to mean the other.

 

seems to me that without gold sinks, the amount of gold in the economy will continue to rise and rise and rise... and rise. Gold is generated by killing monsters and completing quests. If nothing counter balances that, then prices will skyrocket. Gold sinks not only work but they are a must.

 

That is something else that doesn't need to be true. If the amount is currency is finite.. or at least with tightly controlled growth. You would cycle your currency through the loot system in the same way they plan to do with items. When you spend gold.. like say you pay your rent. That gold goes into a pool that loot tables can draw from. Yes but players will horde etc etc.. That is why I said earlier that you need to keep currency flowing in any economic model. You need things players WANT to spend money on.. not just things they HAVE to spend money on.

 

paying rent is a gold sink. However giving money to another player (without a tax) does not fight inflation, nor does it keep money finite. It just transfers gold from one person to another, but the gold in the economy continues to rise regardless if it changes hands. It only means that some people will be really rich, others will be rich, others in the middle, and then there will be new players who are very poor.

Costs will rise if there aren't sinks in place to stop that, and new players will be at the biggest disadvantage.

 

Changing hands has no correllation to gold increasing. Not sure where that comment comes from. Neither does money changing hands between players promote inflation.

Currency moving between players is neutral. It means nothing in of itself. Also, if gold is recycled that has the same effect on the outgoing ends as a gold sink. it's gold leaving the hands of the players. Either as a "sink" or going through the NPC economy or as a tax. Note I never implied no tax either.

In fact I'm failing to see how your arguement has anything to do with what I said.

 

Moving currency between players is neutral... meanwhile adventurers are still finding gold as loot. Therefore without gold sinks prices become inflated. Inflated because even though currency is moving between players, gold is still increasing in the population. So more and more gold is just trading hands = inflation.

If an iron helm costs 300GP at release, and after a few years people just keep harvesting gold without gold sinks, a person could still sell an iron helm for 300GP, but what if somebody sells it for 3000GP and people will buy it because people just have more money to spend. That is fine for somebody with 10mil gold in the bank, but for a newbie who is getting 100gp per goblin, that price is a bit steep.

 

Even if it's only applied to currency, leaving everything else to the faucets and sinks system, then, for all intents and purposes, shouldn't work. At best there will be deflation, as the amount of goods in the economy keeps increasing while the amount of gold in circulation remains constant; at worst, gold hoarding might make its use as a standard collapse, with players finding other kinds of currency, as happened in Diablo 2.

That assuming faucets and sinks don't work, of course. If you assume they work well enough to keep the goods market in check, they should work well enough to keep gold in check too, removing the need for this kind of hybrid closed+open system.

 

I wasn't aware of this. In fact, it was my understanding that in the early days of UO, gold came from monsters and shop keepers via a facet. The following link doesn't really make it clear where the gold originates, but the first flow chart shows that NPC shopkeepers and monsters have it, thus allowing the farming of such mechanics, which as I understand it was (in part) what eventually led to flowchart #2.

http://www.mine-control.com/zack/uoecon/uoecon.html

Yes, because of the hoarding problem.

Well said. Though I'll have to take your word for it on EVE.

I just liked the definition of "gold sink" in the link. Diablo 3 isn't a game that I would want to emulate in any way.

 

One of the things that also happen in the early days of UO was the the inflation was so high that players began to use alternative forms of currency (I believe it was some sort of semi uncommon sea shell) as opposed to gold. The gold market had effectively crashed a few months before the major economy changes described in the link above.

I have always believed that a type of organic barter system was the only thing that would truly balance an MMO economy.

 

That's assuming new gold is being generated rather than old gold being recycled.

 

It seems to me that for a gold sink to work it needs to remove the gold from the economy.
Moving the gold from one player to another via theft or players selling items does not do this. (Of course players selling items is critical for all the other reasons not related to gold sinks)

The trick seems to be to get players to spend a LOT of gold on things that do not give them any advantage in the game.
So if sword does x amount of damage and a new player can buy that sword for 100 gold, a great gold sink would be getting someone to buy a sword that does the exact same amount of damage but will pay 5000 gold for it.

One way I see for doing this is with NPC vendors. I have noticed in UO that people, in particular rich people, will spend a LOT of gold for Unique/Pretty items. So why not have NPC vendors randomly sell ridiculously expensive items with the only special quality is that it is Unique/Rare. If you put 1 of 3 in the description, that might be all it takes. Then if you make 1 of 100 for a particular style of armor and you need 5 different pieces to complete a set that would do it too.

I am sure there are many more examples, but that one seems the easiest to implement.

 

I have to go back to the problem of not having enough to spend your money on. Whether it's a finite currency or sinks and faucets. Assuming they're properly balanced. You still risk inflation and/or income desparity if spending is stagnant.

 

oh I got it before. I'm trying to make the point that we don't have to assume certain things have to be a certain way. Like if we wanted to try a 'finite economy' that it must work the way UO did which failed.

I think we're all pretty well familiar with the problems. It's how to solve those problems it seems few can really agree on.

 

Gold sinks absolutely do work as long as they are monitored and adjusted accordingly. Gold sinks that are 'set and forget' fail.


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As far as I could tell from interviews and such, gold, like other resources, was seeded in an amount that the devs thought would support a full, healthy server. The devs failed to consider human behavior, though.

The issue is what to do about it. You can't really change the players, attempting to make some resource even more scarce only makes players hoard it even more, and making it common enough to both account for the hoarders and let the market work will likely make hoarders stop valuing it, consequently dumping it in the market and making said resource more common than desired.

Faucets and sinks counter this both by being more resilient to such player tampering, and because, when the player recognizes that despite being rare a resource should be always available, their hoarding tendencies often subside. If access to the resource is guaranteed, after all, it's better to hoard the money required to purchase the resource instead of the resource itself.

I'm sincerely not sure if it's possible to make a game that both has a working, realistic economy and is fun, unless the central point of the game is the economy. But making the economy the central part of the game, if not handled very well, has the potential to drive away players that don't really enjoy interacting with the economy.

EVE is often mentioned as having the best MMO economy ever. There is a downside, though; that game is often nicknamed "spreadsheets in space," so tight the integration of the economy in all aspects of gameplay.

EVE uses tightly controlled faucets and sinks to control its economy. CCP has an economist on staff that monitors the economy and, if needed, fine-tunes it in real time, countering potential issues before they become problems. He even publishes reports (quarterly, I believe) about the state of the game's economy.

When you look carefully at it, money is just a fine grained, government-backed (and enforced) barter good. It's why it's very value varies (through inflation or, more rarely, deflation).

BTW, I do agree that, if there is a way to stabilize a game's economy, it necessarily involves allowing whichever chosen currency is used to fluctuate in value.

 

Yes. But that's not a reason not to try.

With the sink and facet economy we know what we're going to get. I think we can do much better and I don't think it's something the devs can manage. I think the nature of the game design has to be flexible and allow players to have success and failure without artificially pushing gold into the game.

It is a very complex subject, but one that should be explored more in SOTA than what the status quo and conventional wisdom of the past as allowed.

 

That's actually not true at all. In the US, and most economies, the official currency is that is the only accepted method of paying taxes. That is where the intrinsic value of the currency comes from. Technically one could barter for everything else they do, but taxes must be paid in federal currency.

 

Until we get an Economy Megapost, the best explanation we'll get is from Richard's interview with Let's Talk Bitcoin. Baron Drocis Fondorlatos, I'm sure you'll remember that thread. Even though the podcast is about Bitcoins, the interviewer covers some very good ground on virtual currencies in games, and Richard provides some very insightful answers that could show the direction for SotA. But we still need more specifics on what he intends to do in SotA in terms of money policy.

 

I'm anticipating an economy megapost in the future and want to set some baselines that I think are important.