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Question about inflation regarding the player driven market.

Author
Sander Lunenborg
State War Academy
Caldari State
#1 - 2012-11-29 17:09:40 UTC
Since the marketplace is supposedly almost entirely player driven, how come there is not a super huge inflation. I'm thinking about all these people doing lvl 4 missions to flll their wallets. Who is actually buying all this stuff? How come there is this constant high demand for almost everything you find. I'm also thinking about salvage components. There must be so much materials flooding the market. Who is making and selling all these rigs?

I'm not ranting. I'm just wondering how the market functions. I'm coming from WoW and they obviously needed to implement things like "soulbound" items to ensure a somewhat stable economy. Maybe CCP is secretly buying up stuff to keep the market stable? Or am I just underestimating how many ships get blown up in PvP?

Some insights about this would be welcome. :)
Xearal
Dead's Prostitutes
The Initiative.
#2 - 2012-11-29 17:24:05 UTC
Welcome to a game that actually requires intellingence. :)

As for your question, unlike WoW, where once you have an item, it's yours forever until you throw it away,
in Eve, when your ship goes kaboom, it's gone, you get an insurance payout to lessen the loss, but otherwise, poof. no more ship, and all rigs, and 50% of the mods/cargo are also gone.
Now add to this, that people love to kill eachother in this game, and blow up/take other people's stuff by any means legal to the Eula, and you get a neverendign cycle of creation, marketting and destruction. Thousands of ships are destroyed across new eden in silly, stupid and spectacular fashions of all stripes, so thousands of replacements for those lost ships, rigs, modules etc. are needed.

This is the beauty of Eve... almost everything you see for sale in the game has been made/aquired by a player. Every ship, module, bullet, missile, implant.. all of those on the market originate from other players, who make their living in Eve aquiring/manufacturing these goods.

CCP also has several economists on their staff who monitor the markets of Eve to see if there's imbalances in it, or bottlenecks etc, and when they arise, they alter the game to fix these.

A good example of this: a long time ago, shuttles were not made by players, but were sold by NPCs, these could be purchased and recycled into 2000 trit or somesuch amount, because of this, and the fixed NPC price, the ceiling of the price of trit was dependent on this. More demand for trit, thus higher prices, would be blocked by people buying shuttles and recycling them to obtain trit at a fixed price, so the price of trit would not rise above this. To counter this behaviour, shuttles were no longer available from NPCs but were made by players, removing this problem with trit.
A similar thing was done with 'Pax Amarria' and noxcium a while ago.

Also whenever the price of Plex spikes/rises too much in their opinion compared to other things, they tend to hold plex sales so people buy more and introduce them to the game.

Does railgun ammunition come in Hollow Point?

baltec1
Bat Country
Pandemic Horde
#3 - 2012-11-29 17:24:37 UTC
Unlike in WoW, in this game when something gets blown up it stays dead. As you have seen we blow up a lot of ships.
Tiberious Thessalonia
True Slave Foundations
#4 - 2012-11-29 17:24:46 UTC
Many, many ships get blown up in PvP.

In the case of rigs, whenever you fit a rig to a ship, those rigs are removed permanently from the market. 50% (on average) of everything else is destroyed as well, with a potential of everything being lost if no one manages to loot the wreck before it dissapears.
No More Heroes
Boomer Humor
Snuffed Out
#5 - 2012-11-29 17:28:21 UTC
Tens of billions of ships can be destroyed in a single battle, sometimes even hundreds of billions.

.

Simetraz
State War Academy
Caldari State
#6 - 2012-11-29 17:28:42 UTC
There is inflation of EVE.

But if the market is flooded the prices go down.
Until players with lots of ISK buy up the market and raise it back up again.

Some items like Trit have gone up.
2006 Trit = 1.98 isk
2012 Trit = 5.97 isk

Others have gone down.
Items with low demand tend to go down as the market get flooded.
High demand items go up and continue to go up.

There are tons of factors that effect prices and no easy fix.
But perhaps the main reason that EVE economy is a little better then other games is that everything is produced by the players and are needed.

Some other games the items crafted by players are never the best and hence as people don't really need or want them there is low demand and players charge whatever they want.
Also those others games have a vast majority of the items on a drop table that can't be produced by players which also does nasty things to a economy.

On and on it goes to many factors and reasons to put in a reply.


Silk daShocka
Greasy Hair Club
#7 - 2012-11-29 17:30:48 UTC  |  Edited by: Silk daShocka
There are things that remove isk from the economy as well, such as skillbooks, the lp store, taxes and other things i can't think of off the top of my head. These are by design to control inflation, and according to the last words from teh devs, eve is in a deflationary period.

Also, in regards to rigs, whenever a ship is repackaged rigs are lost, and it takes a whole lot of salvage to make some rigs.

In regards to "soulbound" or bind on pickup items, I dont think they are needed very much in Eve. I do believe that in some MMO"s items are made soulbound for reasons other than to control inflation. If items in Eve were made "soulbound" it would probably increase the items of comparable goods (ex: scout 200mm AC becomes soulbound, which would increase the prices of other 200mm AC's) due to a smaller supply line, theoretically.
Natsett Amuinn
Caldari Provisions
Caldari State
#8 - 2012-11-29 17:31:39 UTC
If I had to guess, I"d say that there is a rather large number of people playing EVE that are just like the OP. The fact that players don't just make what you buy, but also destroy it, is the very backbone of the game economy.

Other players blowing you up is the very heart of the game.
DarthNefarius
Minmatar Heavy Industries
#9 - 2012-11-29 19:07:30 UTC
While there are a few relatively small ISK sinks in the game there is another BIG 'ISK sink thats not truely an ISK sink because it can pop up again' that is not very easily quantifiable unless Dr E has the DEV tools for it: unsub'd characters' ISK
If every unsubbing player gave away all there'z stuff before they quit the economy would be in very bad shape I bet
An' then Chicken@little.com, he come scramblin outta the    Terminal room screaming "The system's crashing! The system's    crashing!" -Uncle RAMus, 'Tales for Cyberpsychotic Children'
Sander Lunenborg
State War Academy
Caldari State
#10 - 2012-12-03 17:53:58 UTC
Thanks for the replies. Very insightful. Forgot to like your replies so there ya go! :)
Othran
Route One
#11 - 2012-12-03 18:03:11 UTC  |  Edited by: Othran
There's around 10% inflation per year on stuff I look at.

Obviously there are spikes (both ways) driven by deliberate player actions on specific items but in general doing what I do costs me about 10% more a year since 2008.

One of the main reasons there isn't hyper-inflation is that most people tend to keep isk in their wallets rather than trade with it. Edit - you could view this as "savings" in a RL economics parallel.
Merouk Baas
#12 - 2012-12-03 18:34:57 UTC
People also like to pay for their subscription with ISK (via PLEX), so that takes 500 million ISK / month * thousands of players, out of the economy. Probably trillions of ISK each month.
Pyre leFay
Doomheim
#13 - 2012-12-03 18:41:06 UTC
Merouk Baas wrote:
People also like to pay for their subscription with ISK (via PLEX), so that takes 500 million ISK / month * thousands of players, out of the economy. Probably trillions of ISK each month.

Plex is not a sink. Its a transfer of wealth.
Bohoba
#14 - 2012-12-03 19:19:38 UTC
Pyre leFay wrote:
Merouk Baas wrote:
People also like to pay for their subscription with ISK (via PLEX), so that takes 500 million ISK / month * thousands of players, out of the economy. Probably trillions of ISK each month.

Plex is not a sink. Its a transfer of wealth.




ya and its 600-650 isk now :)

for a plex :(
Cass Lie
State War Academy
Caldari State
#15 - 2012-12-03 19:25:06 UTC
Merouk Baas wrote:
People also like to pay for their subscription with ISK (via PLEX), so that takes 500 million ISK / month * thousands of players, out of the economy. Probably trillions of ISK each month.


No it does not. We leave the proof to the interested reader as an instructive exercise.
LHA Tarawa
Pator Tech School
Minmatar Republic
#16 - 2012-12-03 19:35:41 UTC
The answer is simple. Players have the ability ot make choices on which activity they do, mine or mission.

For years, mass loot drop and drone harvesting was leading to massive mineral injection via means other than mining. The result was depressed mining rate of return. Why mine with 3 accounts for 20 million ISK an hour (2 hulks and an orca) when I can mission with 2 accounts (mach and noctis) for 50 million iSK an hour?

The result of the mineral injection via npc drop was lots of people running missions, and still depressed prices do to too much supply.

With the nerfing of loot and virtual removal of drone drops, the artificial supply was removed from market. Initially, this resulted in inflation. However, as mineral prices reached break even point with missioning, people switched from missioning to mining.

Now that I can make 50 million iSK an hour mining or missioning, we've reached a new level of market stability. If mineral prices (and everything manufactured from them) goes up, I mine. If mineral prices go down, I mission.

Cass Lie
State War Academy
Caldari State
#17 - 2012-12-03 19:41:53 UTC  |  Edited by: Cass Lie
DarthNefarius wrote:
While there are a few relatively small ISK sinks in the game there is another BIG 'ISK sink thats not truely an ISK sink because it can pop up again' that is not very easily quantifiable unless Dr E has the DEV tools for it: unsub'd characters' ISK
If every unsubbing player gave away all there'z stuff before they quit the economy would be in very bad shape I bet


Well, this is debatable. AFAIK we don't have solid numbers on this (the rest we have at least some idea about). I am not sure the isk sink related to this is that huge. After all, it presumes that the leaving player has acquired a significant amount of liquid isk, but then, assuming such player has invested his time quite heavily into the game and might have trouble letting it go, wouldn't it be more logical to simply plex the account indefinitely? More and more such cases might be one of the reasons behind the recent seeming plex rise and concurrent pilots online slight decline/plateau.

Also, a note to the OP about terminology. The situation described in the OP would actually lead to deflation - overabundance of in game goods leading to decline in their price.
LHA Tarawa
Pator Tech School
Minmatar Republic
#18 - 2012-12-03 19:45:34 UTC
Cass Lie wrote:
Merouk Baas wrote:
People also like to pay for their subscription with ISK (via PLEX), so that takes 500 million ISK / month * thousands of players, out of the economy. Probably trillions of ISK each month.


No it does not. We leave the proof to the interested reader as an instructive exercise.


Perhaps Merouk mistakenly thinks people are buying the PLEX from CCP.

Merouk, players buy PLEX for real world money, then sell them in game to other players for ISK. Those other players earn ISK, then buy the PLEX from another player. CCP does not directly buy and sell PLEX for ISK.


ISK leaves the game when people buy things from NPCs. Skill books, clone upgrades, implants from LP stores, corp office rental, rent for holding sovereignty in 0.0, insurance that you do not later collect on, market taxes, NPC factory/research slots, ship repairs at NPC stations with repair facility, contract costs, fees to start convo with newbs that haven't set the fee to 0, etc.

ISK enters the game when players receive money from NPCs. Bounties (and the equivalent "overseer's effects" or sleeper drops) , mission rewards, insurance payouts, etc.

ISK does not enter or leave the game, simply changes hands, when players buy from/sell to each other (other than the small market tax or contract fees).

There used to be more sinks, like POS fuel and POS structures, but with PI, those are now manufactured by other players, turnig them from a sink that drains ISK from the game, into just another player/player transaction that moves ISK but does not remove it.

LHA Tarawa
Pator Tech School
Minmatar Republic
#19 - 2012-12-03 19:54:38 UTC
Cass Lie wrote:

Well, this is debatable. AFAIK we don't have solid numbers on this


I would imagine that when CCP is talking wallet balances in ISK, they are looking at just active accounts. They must be pulling inactive accounts out of the main DB tables into temp storage in other tables. To do otherwise is simply performance crushing stupidity.

Cass Lie wrote:

More and more such cases might be one of the reasons behind the recent seeming plex rise and concurrent pilots online slight decline/plateau.


I'd bet the increasing price of PLEX is 100% based on increased mineral prices following loot nerf and drone drop removal. 100% increase in mining profit means miners have more ISK to use to buy PLEX, meaning more demand for PLEX meaning higher prices. We've seen a 100% increase in the profitability of mining and only about 50% increase in the price of PLEX, over the last year. I'd suspect PLEX has quite a bit more room to increase in price.


Cass Lie wrote:

Also, a note to the OP about terminology. The situation described in the OP would actually lead to deflation - overabundance of in game goods leading to decline in their price.


If players drop with both stuff to sell in their hangers and ISK in their wallets, then the removal of both supply and demand should not effect inflation. Of course, if there is a mix of dropped toons, like say, more carebear miners quitting than PVPers, you should see an increase in prices. If there are more PVPers quitting than carebears, I'd expect a drop in prices.
Hast Semah
Doomheim
#20 - 2012-12-04 04:36:48 UTC
Don't forget all the named meta 2 -4 modules that aren't manufactured by players. I'm not sure if all the ones in the market are sold by players who looted them from missions, or if they are sold by NPCs.
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