How to have a free market economy that doesnt inflate out of control.

I think you guys missed the boat, the OPer said it in the first sentence, and the answer is quite clear to me.

Stop spawning "Gold" as loot...

Mr RG has already stated that "crafters" will be able to sell their wares to NPCs, and that these items will be channeled into the "loot" system, so instead of gold he is giving you a crafted item "made by Kooky" "Slayer of 156 Dragons", if you repair the item, it will fetch 40gp, if you don't it will fetch 30gp.

Or you may find a piece of Coal or Wax, and you can skin the animal for it's 1 hide, and butcher it for a rib or two. Provided you have the skills & tools. Humping your kill back to your butcher table will be more like it.

I hope "Gold" is the scarcest thing in the game... Or it should take alot of hard work to get...

 

I think everyone got it, but that wasn't the full extent of what the OP was suggesting. Limiting gold doesn't guarantee a free market but it would prevent inflation. His suggested price fixing mechanism wasn't an obvious winner IMO, that's not to say it couldn't work but rather I'd need to see more details.

 

When I left UO at the beginning of this year, the inflation problem was mostly caused by people buying UO gold with real money from the various real world UO stores online. People would buy millions of UO gold for only a few real world dollars. Meanwhile, 99% of player vendors couldn't make money in UO. The exorbitantly high weekly commissions on stuff that you hadn't even sold made it so that you would usually lose money on stuff being held for sale by your NPC vendor. This was especially true with high value items. You simply couldn't afford to have a high value item on a vendor unless you were in a super prime city location and that one (on Lake Austin shard) was dominated by a single vendor. I hope it isn't that way on SOTA. I knew a lot of crafters & tamers (like myself) who were very disappointed that their crafting, resource gathering and taming skills didn't make gold for them.

I agree with paying your player vendor a reasonably weekly fee. But as for the commissions, I don't think those should be paid unless your vendor actually makes a sale. Owing the game commissions on stuff that hadn't even been sold kept most people from being able to sell stuff on vendors unless they were selling very cheap high demand items that would turnover within a few weeks. The few remaining vendors with super prime retail locations had little competition to keep down their own prices which was an additional cause of inflation. Sticking with my Lake Austin shard example, it had one dominant billionaire merchant. Most of the other vendors went out of business and many of us left UO in frustration. Many of the rest stopped crafting and resource gathering except for our own personal needs.

 

A way to prevent inflation could simply to have free market currencies ingame. Allow players to make their own currencies whether that is items or custom coins that you could mint, the only way they could hold value is if someone is willing to accept it, so there's no way it could break the economy. Over time players would pick the best currencies to use, people are going to pick the currencies that best suit their needs and wishes, if there are currencies that don't inflate, people are likely to pick one and have it become widely used, then if people pick inflating currencies they only have themselves to blame for inflation.

A way it could be done is to have an item that allows you to create your own money (paper, coins, whatever) and you choose a name for your currency that is saved to your character with the ability to grant permission to players of your choice to also use the name, and thus the currency can only be created by yourself and whoever else you choose which should prevent counterfeiting. With this system over time the best currencies would become the most used, and it would allow people to create the currencies they wanted. People who wanted a deflationary currency could have one, people who wanted a currency backed by nothing but with a limited supply to prevent inflation would have one, and the people who would prefer to use a commodity backed currency could create one.

Everybody wins, and there would be no widespread inflation problem, with inflation being limited only to people who choose it.