May 04

Game World Economics

 

162x90genlogo Game World EconomicsEconomic stability in virtual worlds is a major factor in the long term viability of any game structure, and FML like many others has struggled to find a suitable degree of stability on the financial front. In a lot of ways virtual economies are run along similar lines to real world economic models, but in a few key areas they must depart from realism – and it is these areas which add complexity to the task of achieving economic stability.

Human decision making is the biggest area of financial management which cannot be coded for in a virtual environment. As much as people can be encouraged or educated about reasonable prices to pay, unfortunately for a variety of reasons people will always go beyond the sensible in their desire to acquire something for their own use. In FML this results in massive inflation and the distasteful practice of player trading, often a deliberate and calculated act designed to maximize profit at the expense of the inexperienced.

Throughout the Beta testing and continuing through the early stages of the soft launch of FML many have complained on the forums about the prices paid for players, predominantly in terms of wages offered in wage auctions, but also in terms of the transfer prices paid for players. The often overlooked factor in all of these complaint threads is the fact it is the buyer’s choice that determines these prices.

Market Value (MV) was introduced during the Beta process to provide a consistent guide to those who found it difficult to judge a player’s value. Essentially it was designed as a time saving tool that would approximate a player’s current worth based on similar transfers of similar player types. However, many have since ignored the intended principle of MV and use it as a minimum price guide, often asking (demanding) 2-3 times this valuation for a player transfer. This practice is then encouraged by those that agree to pay that price, and a useful tool in determining player valuations has become a driving force in the inflationary process.

Solutions

Because they are an escape from reality, virtual worlds need to provide a financial safety net for all users. Without it people will simply fail and end their participation. In terms of FML this comes in the form of a guaranteed minimum daily income, and this needs to be maintained at a level suitable for paying the minimum required debts of the users, along with a variable portion of gain. Essentially this means more money comes into a game world on a daily basis than what is removed.

By itself this would create a large degree of financial instability (and did in the early alpha worlds), so a number of adjustments are required to assist in the removal of cash from a world on a regular basis.

A lengthy period of the Beta process saw a large variety of solutions suggested for reigning in the economic inflation. The multitude of opinions for and against the proposals often created some very lengthy and ultimately constructive threads on what needed to be implemented to slow down the rapid depreciation of currency in game worlds and for individual teams.

Due to a number of issues surrounding initial soft launch, some of the priority changes were left out of the initial 1.0.0 launch worlds. But the recent 1.0.1 update saw an effective adjustment to equalize the discrepancy between wages paid and income received, more in keeping with the reputation driven income model that is the base of the game’s economy. It also saw a number of restrictions being introduced in terms of competition set up and prize money levels.

This work has been extended in the 1.1 update. The arrival of a raft of taxes and fees into the economic structure will see 1.1 becoming the key element behind the game’s future chances of success. With a variety of separate elements designed to draw money from a game world, the ability to adjust the economy in selected areas will give greater control over any future economic adjustments.

Contentious Issue

A number of the coded rules introduced in the 1.1 update will limit the freedoms previously given to users over player trading. They were met with some skepticism in the discussion threads and will no doubt create controversy on release, but they fill a very important role in the future stability and health of the market place. The equation used to produce MV has been tightened and stabilized for 1.1, and will now be used as a fluctuating limitation on private sales and player swaps. A lot of discussion around using it to create a maximum cap for private transfer saw continuing disagreement and was subsequently left out, but the use of MV in determining a minimum price for private transactions and swaps will prevent much of the destabilizing “mates rates” trading that has infiltrated FML at times. Players sold at very low prices must now be done through auctions with a minimum setting of 24 hours, giving the entire game world an opportunity to purchase them.

As mentioned at the start of this article, human decision making is the most difficult area to code against. The changes to private transfer rules are an example of this and will not please all, but as there are alternative trading methods it is deemed as an acceptable level of control over user freedom.

“Money Sinks”

The introduction of Stadium Building in FML will see the first of the long awaited “money sinks” into game worlds. With the added costs of continual upgrading and repair of stadium facilities, the overall economic structure will have an additional outlet for monetary spending. Stadiums are the first in a list of planned infrastructure additions to your club, and they will have a major effect on both spending and earning capabilities. Whilst overall maximum income will continue to be governed by your team’s reputation and on-field success, it is the effective planning of your stadium that will allow you to capitalize on that earning potential.

Future updates which introduce Youth Academies (planned for 1.2) and Medical Centers will further increase the potential for clubs to spend their wealth in alternate directions, reducing inflation and stabilizing the overall economic structure.

Future Controls

Will there be further need to modify the economy in FML? Probably. To put it simply, it is impossible to guard against the decisions individuals will make in dealing within such a liberal economic atmosphere, and, short of fixing prices for everything, there is no way to prevent fluctuations in the economic health of game worlds. But one of the benefits from the latest introductions is the way different areas of the economy have been split, enabling modifications to tax rates, interest rates, fees, etc. as separate entities rather than overhauling the economy as a whole. The future will likely see modifications to various aspects of the economy, but the current package is designed around flexibility so a stable set of rules will apply. One area already under discussion is the ability to divert funds collected via a current tax or fee back into the game world as increased FA funding, so there is now greater control between money in and money out of a game world and the ability to manage that on a more detailed level.

Will it work?

From experience throughout the Beta and early launch worlds the answer is “it already has”. Every game world will have differing economic experiences; because the economy in each world will be a driven by the way the members in that world choose to play. The main effect from the current model and future updates will be to stabilize the base economic structure of each world, but as long as there are choices there will be differences.

Will it stop “silly” bids ?

Personally I disagree with the forum threads that complain about “silly” (high-priced) bids on players. Simply put, if you want a player and have the cash then you are free to waste as much as you want. What will have a dramatic effect on these bids, however, is the early sales tax/automatic sell on clauses introduced in 1.1, which prevent profiteering through the quick sell-on of players, which in turn will generally force people to shoulder the full value of their bids for the majority of a season.

The full effectiveness of the economic structures within FML will not be seen in worlds where a majority of users are focused on short term domination plans – but as worlds evolve and the long term community structures and ideals develop, the stability of the current range of economic measures will begin to have a valuable effect for both those who have been “in-world” since the beginning, as well as for those who may wish to join a world evolving beyond the initial fascination of “name” players and world domination.

Mark Burton

Written By Mark Burton
A moderator since May 2008 in a number of beta worlds and now GW Fowler, he strives to highlight the community aspects of FML and inform new & experienced users about future game development.
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  • It maybe a little out of date, like you said Mark, but it's a reminder of how far I believe the games economy has come.

    Because I'm in Keane, there was obviously the pretty uncomfortable period when the stadium update was rolled out. Having planned for it though (I sold my best player for £4m despite being worth half of that :)) I was able to build a stadium worthy of my fans and my teams 3.5* rep.

    The economy in Keane is now just about where it should be and it feels a much more balanced place.

  • Spinsaweb

    Looks a little dated now :(
    Yes that's how long ago GW1 was looking to be launched.

    Although apart from the now obvious fact that Academies, etc will not be in 1.2, i think the rest of it stands up.

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