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How does CCP take control of in- and deflation?

Author
Jurik McMoney
Deep Core Mining Inc.
Caldari State
#1 - 2014-06-25 14:39:44 UTC  |  Edited by: Jurik McMoney
I would like to know how CCP works against inflation. (If they do it.)

First I read this old and this newer forum thread.

But I think both have a wrong understanding of how virtual world economy works. Especially that you can not park your ISK save. It does not matter if you park your ISK into plex or expensive ships - that is all speculating. Only CCP drives in- or deflation.

In- and deflation is only driven by how much money CCP puts into and takes out of the eve universe.

How CCP puts ISK into eve universe (generate ISK):

  • npc pirate bounty
  • mission reward


How CCP takes out ISK form eve universe (destroy ISK):

  • skill books, BPOs
  • repair service
  • insurance service
  • LP Stores
  • reprocess/manufacturing/inventing service
  • plex
  • war decs
  • taxes (PI, sell/buy orders)

Anything else?

How does CCP work against inflation/deflation?
Now it would be nice to know how much ISK CCP puts into the game and off the game. It is kinda hard to believe that the community generates more ISK with npc pirate bounty and mission rewards than it destroys with all the other points from the other list.

What do you think? Do we have any informations about that?

Because all the prices and rewards are static, CCP can't setup anything to work against inflation or deflation. Or am I wrong? Maybe they take the balance with a simple control of what missions are offered and what kind of pirates spawns in any belts or sites.

So if we have an inflation, because there is too much money in our eve universe, CCP just spawns more smaller pirate ships in all belts and if there's a deflation, they spawn more bigger ships with better ISK/time ratio.

What do you think?


Offtopic:
But what happens if 90% of all manufacturer would stop doing their business?

WRONG: I guess then it would not matter how much money we got, because there are not enough items to buy. Everything would be expensive - but a solution wouldn't be to generate more ISK - because ISK is in this situation not the problem.

CORRECT: That would cause a massive inflation, because you will have to pay much more for something. But if they would produce 90% more than right now, all prices would fall down and our ISK would be worth more - deflation. That is why in our real world companies rather destroy their goods instead of sell them cheaper.

Summary
Be nice to your manufacturers! ;)

PS: If you are interested in this topic you can read more from this guy Edward Castronova. He wrote some nice papers about virtual world economy. Papers that many game companies should have read ... companies like Blizzard obviously didn't take care of it ;)

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Eugene Kerner
TunDraGon
Goonswarm Federation
#2 - 2014-06-25 14:51:06 UTC
Winter is coming?

TunDraGon is recruiting! "Also, your boobs [:o] "   CCP Eterne, 2012 "When in doubt...make a diȼk joke." Robin Williams - RIP

VonCricer
The Spring
#3 - 2014-06-25 14:55:10 UTC
I do not believe Plex takes isk out of the game, it is a net 0 effect.
Jurik McMoney
Deep Core Mining Inc.
Caldari State
#4 - 2014-06-25 14:56:25 UTC
VonCricer wrote:
I do not believe Plex takes isk out of the game, it is a net 0 effect.


Of course it takes money out of the game. CCP wants 600M or something from you for a plex. That means that CCP takes 600M out of the game.

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Ramona McCandless
Silent Vale
LinkNet
#5 - 2014-06-25 14:57:08 UTC  |  Edited by: Ramona McCandless
So... CCP are operating like the Federal Reserve or the Bank Of England; controlling inflation through Quantitive Easing or destruction of hard currency and interest rates?

Um.. isnt that it?

"Yea, some dude came in and was normal for first couple months, so I gave him director." - Sean Dunaway

"A singular character could be hired to penetrate another corps space... using gorilla like tactics..." - Chane Morgann

Jurik McMoney
Deep Core Mining Inc.
Caldari State
#6 - 2014-06-25 14:59:21 UTC
Ramona McCandless wrote:
So... CCP are operating like the Federal Reserve or the Bank Of England; controlling inflation through Quantitive Easing or destruction of hard currency and interest rates?

Um.. isnt that it?

Yes - but only IF they do it like I wrote. I have no idea if this is their approach to keep ISK stable.

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Ramona McCandless
Silent Vale
LinkNet
#7 - 2014-06-25 15:01:33 UTC
Jurik McMoney wrote:
Ramona McCandless wrote:
So... CCP are operating like the Federal Reserve or the Bank Of England; controlling inflation through Quantitive Easing or destruction of hard currency and interest rates?

Um.. isnt that it?

Yes - but only IF they do it like I wrote. I have no idea if this is their approach to keep ISK stable.


Ok

Why do you ask?

"Yea, some dude came in and was normal for first couple months, so I gave him director." - Sean Dunaway

"A singular character could be hired to penetrate another corps space... using gorilla like tactics..." - Chane Morgann

Jurik McMoney
Deep Core Mining Inc.
Caldari State
#8 - 2014-06-25 15:04:03 UTC
i would like to know if someone knows how CCP controls in- and deflation. I posted my idea or thoughts, but I am not sure what they are doing.

Because in one thread someone said plex price is raising 15% a year - so I would assume that our inflation is at 15% - that is kinda high.

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Omar Alharazaad
New Eden Tech Support
#9 - 2014-06-25 15:05:48 UTC
wait, what? CCP isn't the one taking the 600+m for your plex, it's another player. Bartender, I'll have what he's having... make it a double.
ISK is destroyed, per se, when accounts holding it go inactive or unsub completely. It bleeds here and there in conversation fees, broker fees, and taxes on transactions. That said, it's a trifle compared to the pouring faucet that are missions and the like.

Come hell or high water, this sick world will know I was here.

De'Veldrin
Republic University
Minmatar Republic
#10 - 2014-06-25 15:08:14 UTC  |  Edited by: De'Veldrin
Omar Alharazaad wrote:
wait, what? CCP isn't the one taking the 600+m for your plex, it's another player. Bartender, I'll have what he's having... make it a double.


Not always.

CCP keeps a pretty close eye on the rate at which PLEX prices change, and they have been known to sell plex directly in game themselves to control that rate of change*. In that case, the money goes into some CCP vault as is not returned to the economy like it would be if the purchase was made from another player.


*Note: It's my understanding that it's the rate of change of the price (Δp) that CCP cares about, not necessarily the actual in game price (p).

De'Veldrin's Corollary (to Malcanis' Law): Any idea that seeks to limit the ability of a large nullsec bloc to do something in the name of allowing more small groups into sov null will inevitably make it that much harder for small groups to enter sov null.

Ramona McCandless
Silent Vale
LinkNet
#11 - 2014-06-25 15:11:01 UTC
Jurik McMoney wrote:
i would like to know if someone knows how CCP controls in- and deflation. I posted my idea or thoughts, but I am not sure what they are doing.

Because in one thread someone said plex price is raising 15% a year - so I would assume that our inflation is at 15% - that is kinda high.


Supply and demand on that one, old boy

PLEX isnt going up because of inflation;

PLEX rising is CAUSING inflation

And for CCP thats just fine

Of course, it sucks that T2 ships have doubled in price in just three years, but then as PLEX have too that menas the ship is the same value as it was, its just the Isk/$/£/Euro has dropped signifigantly.

Of course, thats not counting the value of the RW currencies, but I guess it depends on your measuring stick

Isk is far easier to make than it was 3, 4 or 5 years ago, so that probably has an effect too

"Yea, some dude came in and was normal for first couple months, so I gave him director." - Sean Dunaway

"A singular character could be hired to penetrate another corps space... using gorilla like tactics..." - Chane Morgann

Jurik McMoney
Deep Core Mining Inc.
Caldari State
#12 - 2014-06-25 15:14:26 UTC  |  Edited by: Jurik McMoney
Ramona McCandless wrote:
Isk is far easier to make than it was 3, 4 or 5 years ago, so that probably has an effect too

That means it is far easier to farm npc pirates or do missions now?

Because there is no other way to generate money into eve universe. Everything else like trading or hauler contracts is just cash flow inside eve universe and has nothing to do with in- and deflation.

And what do you mean with:

Ramona McCandless wrote:
PLEX isnt going up because of inflation;

PLEX rising is CAUSING inflation


CCP charges less ISK for one plex? I thought they charge more ISK for one plex. That would mean, that you take more ISK out of game instead of leave it in game for a plex.

And if you buy a plex for euros or dollars, it has no influence on in- or deflation. Because it does not generate any ISK in eve universe.

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Solitaire Project
Science and Trade Institute
Caldari State
#13 - 2014-06-25 15:18:53 UTC  |  Edited by: Solitaire Project
Insurance ADDS ISK to the economy.

Unless you mentioned it somewhere and I missed it,
but in the initial post it's in the wrong category.

And aren't there still NPC buyorders around?
Especially for WH loot? Is that still a thing?


I get the impression that you're not really qualified to question CCPs doings.

White light, shining bright!

Tippia
Sunshine and Lollipops
#14 - 2014-06-25 15:20:56 UTC  |  Edited by: Tippia
Jurik McMoney wrote:
In- and deflation is only driven by how much money CCP puts into and takes out of the eve universe.
Not quite. CCP does none of the things you list. Players do, by choosing which activities to pursue. CCP can try to adjust the flows by altering the faucets and sinks, but what actually drives the movement is player activity.

Oh, and PLEX does not affect the money supply. Here's the complete list:

ISK Faucets:
  • NPC bounties: Exploration, Belt rats, Missions
  • NPC buy orders: Trade goods, Sleeper loot, Overseer effects, Tags
  • Agent rewards: Mission rewards, Mission time bonuses, Incursion rewards, Deposit repayment
  • Insurance payout
  • GM actions: Reimbursement for lost pods
  • Character creation

ISK Sinks:
  • Market taxes & fees: Broker fees, Sales tax
  • NPC sell orders: Blueprints, Skill books, Trade goods
  • NPC station services: Repairs, Jump clone installation, Medical clone installation/upgrade/station change, Science and industry slot rental, Ship insurance
  • NPC station office fees: Rent, Impound penalties
  • Wardecs
  • Reimbursed player bounties.
  • Sovereignty fees
  • PI fees: Building PI structures, Import/export tax (from NPC-owned and highsec customs offices)
  • Corp & alliance fees: Corp creation, Alliance creation, Alliance upkeep, Creating/awarding medals, Corp registry ads
  • Agent fees: (Certain) LP store items, Locator agent services, Courier missions w/ deposits
  • CSPA Charges
  • Smuggling fines
  • GM Actions: Removal of bought ISK, Removal of insurance after ship reimbursement
  • Character deletion (including the “soft sink” of accounts being frozen or banned, and the even softer sink of accounts being abandoned forever)

Quote:
Now it would be nice to know how much ISK CCP puts into the game and off the game. It is kinda hard to believe that the community generates more ISK with npc pirate bounty and mission rewards than it destroys with all the other points from the other list.

What do you think? Do we have any informations about that?
Google is your friend. We have tons of information about this, along with the measures they have to adjust the habits of players.

Quote:
But what happens if 90% of all manufacturer would stop doing their business?
Almost nothing, as others would instantly fill the void.

Quote:
CCP charges less ISK for one plex?
CCP doesn't charge any ISK for PLEX.
Solitaire Project
Science and Trade Institute
Caldari State
#15 - 2014-06-25 15:23:03 UTC
Tippia to the rescue!

White light, shining bright!

KaarBaak
Squirrel Team
#16 - 2014-06-25 15:25:31 UTC  |  Edited by: KaarBaak
Solitaire Project wrote:
Insurance ADDS ISK to the economy.

Unless you mentioned it somewhere and I missed it,
but in the initial post it's in the wrong category.

And aren't there still NPC buyorders around?
Especially for WH loot? Is that still a thing?


I get the impression that you're not really qualified to question CCPs doings.


I think it's a matter of insurance payout vs insurance purchase. In the commercial world, the total taken in in policy premiums > payouts. Hence, it should be a net sink.

Whether EvE functions this way...I'm not sure.

BTW, in MMO terms, the words are "sinks" and "faucets."

KB

EDIT--knew it wouldn't be long before Tippia did a copypasta from the hundreds of other times this has been discussed.

Dum Spiro Spero

Jurik McMoney
Deep Core Mining Inc.
Caldari State
#17 - 2014-06-25 15:27:10 UTC  |  Edited by: Jurik McMoney
Tippia wrote:

Quote:
But what happens if 90% of all manufacturer would stop doing their business?
Almost nothing, as others would instantly fill the void.


Well, of course, but this questions was about that nobody fills the void ;)
Tippia wrote:

Quote:
CCP charges less ISK for one plex?
CCP doesn't charge any ISK for PLEX.

I thought you can buy plex time bonus for ISK. But I think that I missunderstood it. So you buy it from people which bought it for real money, okay - so they have no influence - alright.


I think you missed clone costs in your list.

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Ramona McCandless
Silent Vale
LinkNet
#18 - 2014-06-25 15:27:14 UTC  |  Edited by: Ramona McCandless
Jurik McMoney wrote:

That means it is far easier to farm npc pirates or do missions now?

Because there is no other way to generate money into eve universe. Everything else like trading or hauler contracts is just cash flow inside eve universe and has nothing to do with in- and deflation.


No I mean its easier to get Isk into your wallet than ever. If its twice as easy to afford something that is now twice as expensive in figures, then there has not been an y inflation in real terms.

Jurik McMoney wrote:

(1) CCP charges less ISK for one plex? I thought they charge more ISK for one plex. That would mean, that you take more ISK out of game instead of leave it in game for a plex.

(2) And if you buy a plex for euros or dollars, it has no influence on in- or deflation. Because it does not generate any ISK in eve universe.


(1) CCP doesnt charge Isk for PLEX. Buying PLEX with Isk doesnt take money out of the game at all.

(2) Of course it does. If a PLEX costs £15 today and gets you 750m isk, and then the value of the £ changes, you will be able to afford or or less Isk, depending on that change.

BTW, I leave this in Tippia's care now, she's well better at all this stuff than I am.

"Yea, some dude came in and was normal for first couple months, so I gave him director." - Sean Dunaway

"A singular character could be hired to penetrate another corps space... using gorilla like tactics..." - Chane Morgann

Tippia
Sunshine and Lollipops
#19 - 2014-06-25 15:32:01 UTC
Jurik McMoney wrote:
Well, of course, but this questions was about that nobody fills the void ;)
It's a particularly silly hypothetical, but in that case we don't know because it will depend on what else happens in the economy.

Tippia wrote:
I thought you can buy plex time bonus for ISK. But I think that I missunderstood it.
Yes, that and a few other things… like how faucets and sinks work, how the money supply works, and what they're balanced against. P

Quote:
I think you missed clone costs in your list.
No, it's a station service.
Jurik McMoney
Deep Core Mining Inc.
Caldari State
#20 - 2014-06-25 15:32:30 UTC  |  Edited by: Jurik McMoney
Tippia wrote:

Quote:
Now it would be nice to know how much ISK CCP puts into the game and off the game. It is kinda hard to believe that the community generates more ISK with npc pirate bounty and mission rewards than it destroys with all the other points from the other list.

What do you think? Do we have any informations about that?
Google is your friend. We have tons of information about this, along with the measures they have to adjust the habits of players.


Well - I used google and didn't find any information about what I asked. There were no information about if they change any spawn rates of NPCs or if they do something else to work against inflation.

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