Economy Style: Currency vs Barter System

[Whitellama]

I'm not trying to shove the fact down everyone's throat, but me and my bro are hosting a minecraft server, and me and a mod had an argument recently over how the economy should work. We talked about it for a while, but didn't come to an agreement, so I figured I'd read up, and that I'd throw this up in the debate section as well, to see if you guys can't provide some insight on the better system for minecraft.

I want a currency system, as it leads to more flexibility in trading, rather than the barter system where lets say Person A wants wood, Person C has wood but wants iron, but Person A only supplies coal. You would need a person B that wants coal and will give iron, so that Person A can trade with Person C. Money eliminates the problem by creating something that is useful in all trades.

The mod on the server wants the barter system, arguing the logic that bartering allows a supply and demand type of thing, which I don't quite understand, as to me it sounds like the logic that when you have less of an object to sell, it gets more expensive, which works with currency as well. (Unless I have what he was arguing totally wrong and he mean't something else.) I'm not completely opposed to the barter system however, as with a new currency, it is very hard to get a grasp on the currency's value until you've performed a decent amount of transactions. And also, because players don't quite understand the currency's value, they may become very stingy with their purchases, creating difficulty for store owners that haggle with prices, instead of giving set prices, ad producing set prices is hard to do when you don't have a grasp on the currency's value. (See the problem?)

The only logical way to come up with an objects value, is by thinking in the following way:

If the player starts with 5,000 for a currency, how many diamonds should they be able to buy with the money they initially have? That depends on whether the amount they start with is supposed to be a modest amount, a lot of money, or barely enough to get by. Lets say 5000 was meant to be a modest amount, then it should provide a modest amount of diamonds, lets say 5 diamonds. Then you go 5000/5=1000 (derp), and you sell each diamond for 1000. This same process goes for other sold goods as well.

I feel the above process is still a bit tricky, so I felt I'd drag one of my predicaments into the debate section, and see what the community decides.

[AlphaWeeaboo]

It really depends on size availability of said "currency". How will people obtain currency? With currency you'd have to have it produced to people in a way that will make it come back again. If you are using a mod that makes a not physical currency then that eliminates the possibility of people framing their own cash. I have played on a server that uses both of these systems. Basically, people are allowed to set up shows in which they supply items. From there people are free to exchange coins in their store (items stored in special chests) the money is successfully transferred into the other persons account.

Well, I dunno what I'm saying here but depending on how things are worked out, a currency would work best for your server if instated correctly.

[Whitellama]

The primary method of obtaining currency would be what you start with, the initial 5,000, which is not physical, it's using iconomy. And with what you said about making it come back again, one of the ways I thought about this already, is by using my store as a way to bring money into the economy. For example, when I buy a certain material from someone, I could simply buy the resource from them, pay them spawned money, and burn whatever I bought, then do this at several different stores. To remove money, but still bring in an equivalent of resources, when people buy from me, I could spawn the goods they want, and then delete the money they pay to me. However, I don't think there's much of a purpose of raising or decreasing the money in the economy, unless there are a few players that get themselves rich and ditch the community or something. What I don't want to happen, however, is for me to be continuously be pumping money into the economy, and at the same time be lowering the value of the currency, which I think is called market inflation?

[AlphaWeeaboo]

Another thing I've seen done before is a quest mod which gives players quests to do things like "Obtain X amount of Y" After finishing that the player can redeem the items and automatically gets some money. Thus creating a "job" of sorts.


Also i find this image useful for economics.

[Shisa]

The primary method of obtaining currency would be what you start with, the initial 5,000, which is not physical, it's using iconomy. And with what you said about making it come back again, one of the ways I thought about this already, is by using my store as a way to bring money into the economy. For example, when I buy a certain material from someone, I could simply buy the resource from them, pay them spawned money, and burn whatever I bought, then do this at several different stores. To remove money, but still bring in an equivalent of resources, when people buy from me, I could spawn the goods they want, and then delete the money they pay to me. However, I don't think there's much of a purpose of raising or decreasing the money in the economy, unless there are a few players that get themselves rich and ditch the community or something. What I don't want to happen, however, is for me to be continuously be pumping money into the economy, and at the same time be lowering the value of the currency, which I think is called market inflation?

You're right. Having people start off with a set amount of money would create artificial inflation. Instead what you should do (if this is at all possible) to make it so your minecraft citizens take out a loan to start off into the world. This, for one, would limit the amount of money produced to a set amount, keeping it relatively high for a large amount of time (until your community grew and you would need to expand on the types of currency you have), and keep artificial inflation down simply because you're taking back what you gave them. You're giving them this loan to start off for whatever trade they will be doing into. In the very end you will need to find some way to enforce this loan system.

At the end of the day, if you wanted to get really intricate with it, you could have it so whatever property your citizens owned would be taxed as well. If you seem to be worried about players leaving for a set amount of time, and them being rich, you could take away their money very slowly... and then their things... and then everything else.

The only problem with doing this through a game is that there are people who will run themselves into unfathomable debt which is why you should only give them as much as they possibly will need, although you could probably put a limit on how much they could borrow at one time, especially if you kept the initial loan down.

Had I had it my way I would say "fuck it they start off with nothing" and make it so they had to find work.

Enforcement is key in all of these systems though. The barter system initially will work the best because it's very fair. The only problem is that you will see NO growth. There will be no rich or poor unless some ass hat decides to trade off their goods for a lower price than it's worth and such, but that ass hat will only be a "little" richer than the rest. It'll keep most things even.

Darkemo's image is very helpful.

[san445]

if the item is high in supply low in demand, the value/price is low.
if the item is low in supply but high in demand, the value/ price is high.
 
thank you good night much love.

[Raunky]

San, did you even read the thread before walking in here and stating the obvious?

[san445]

As they say when you doing exams:"pretend everyone is stupid"

[Raunky]

LET ME PUT THIS IN TERMS YOU WOULD UNDERSTAND.

with u, i dont have to pretend lolololol 

[san445]

Administrator Comment

Personal attacking? Really? Have a nice time away.

[Bjork]

Barter is imo the best since it means that farming items like wool might actually be able to get you some bacon etc.

It also adds to the community feel.

If a shop owner really wants he could set his price in iron ignots for example