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(Un)Foreseen Consequences

I want to start off with a quote from Ravious of Kill Ten Rats:

“Players are simply wrong when they say Guild Wars 2 has a “failed” economy. Players that claim failure have a misconception of the economy they believe the MMO should have. It isn’t failed because supply and demand are working, just not in final products. The supply of a final product far outweighs demand, even with the trash compacting Mystic Forge. Still I’ve seen plenty of profit that can be made with small amounts of market inefficiency or player laziness. A failed economy would not provide such opportunities.”

My very first reaction was the following mental image:

Has it really been just four years? Yikes.

To be fair, yes, it matters what kind of economy one thinks is appropriate for an MMO. Personally, I am a fan of the whole “labor + resource = increased value.”

The week of Ravious’ post, we got a slew of Guild Wars 2 ping-ponging hotfixes. One of them was a sudden removal of Cooking materials from vendors; prior to this, the game’s only “Advanced Profession” could be leveled 1-400 for roughly 80 silver and a few thousand Karma. Some of the removed items, like the notorious Stick of Butter, suddenly started showing up in copious amounts in the bags of goodies that humanoid mobs drop. While there was an initial panic going from vendor to drop, Butter was quickly selling for 1c because it dropped in 5-8 stick increments and seemed to replace actually good drops 50% of the time. Then you had other crafting mats in the Tier 2 level going for vendor+1c even as their Tier 1 variants were still making bank. At one point there were 8 million Soft Wood Logs on the AH, for example.

Last Friday, ArenaNet’s generically-named in-house economist, John Smith, came out with a similarly generic post on GW2’s economy. The entirety of the relevant bits were the following:

We’ve noticed several markets that are clearly out of sync in terms of supply and demand. It isn’t interesting or fun to have a market flooded with items that contain very little value, so we’re making adjustments to the game every day. Players can expect to see these markets even out over time.

While adjusting the supply and demand will bring markets closer to non-vendor based equilibrium, there is still the matter of massive surplus of some items. To address the surplus, we’ve created some new, limited-time Mystic Forge recipes that use these items. These recipes create boxes that give chances for gold and some cool items.

The “adjustments” they made were recipes that called for 500 Sticks of Butter (Soft Green Logs, etc) + two other items to create a chest that could have up to a 2g vendor item plus some other cosmetic items. As should come to no surprise, the price of Butter (etc) skyrocketed. No doubt a large quantity of these over-supplied items left the economy permanently as people gambled their money away. And I have to hand it to ArenaNet, insofar as utilizing the Mystic Forge as both a hole to throw items into and a money sink simultaneously.

But I have no real confidence that John Smith knows what he is talking about.

Pondering over this whole economic episode has led me to think about the interactivity between all these moving parts and the unforeseen consequences. For example, I am a huge fan of individual loot and resource nodes; in fact, I think they are one of the best “innovations” of multiplayer games since… well, possibly ever. But if two players tap the same mob/node and get 2x more loot than they would in other games, that means games with individual loot/shared nodes will (potentially) have twice as many items dropping. You cannot just “solve” the issue by cutting drop-rates in half though, or making crafting professions require twice as many resources, because that leads to a dissatisfying single-player experience.

Then you build your game around Dynamic Events with huge, scaled mob encounters with AoE all over the place. Provided you have the chance to deal enough damage, it is not uncommon to go from zero to full bags of gear from just 1-2 of these Events. You are selling bag space in the cash shop, so you have an incentive to keep bag space tight. But being able to sell to the AH from anywhere – itself a supremely good-feeling feature – means players would rather list all this excess gear for vendor+1c despite it being at a loss, simply because a loss is better than destroying the gear entirely.

Nevermind the crafters dumping gear on the AH in 5-level increments, competing not just with each other but with all the generic item drops too. Considering you can get +10 levels worth of XP per crafting profession, and the cost of switching inbetween them is fairly trivial (compared to losing all your progress) there is always an incentive to at least start one or more professions on all of your characters.

This preponderance of vendor+1c gear means the average player can “Lease” upgrades throughout their adventuring career – buy the level 30 sword for 80c, use it until level 35, sell it for 79c, then buy the level 35 sword for 90c, and so on. This leads to the Diablo 3-ification of gear upgrades, making drops/Karma/quest rewards simply vendor-fodder for the 24/7 AH pellet machine. The entire concept of character progression breaks down, generally at the same time you unlock your level 30 Elite Skill and otherwise experience no further change to your PvE play-style.

I do believe Guild Wars 2 brings some extremely nice innovations to the MMO formula. However, I am getting the distinct impression that other MMOs do not have these features precisely because of all the unintended consequences they bring down the line. It is clear ArenaNet believes the Mystic Forge Will Fix It™ but I simply do not see how. Limited Time recipes eliminate surplus stock, but the fire hose of drops (and the roundabout incentives to post them all) continues unabated.

If John Smith can economy his way out of this, without ArenaNet dialing back all the player-friendly features, I will be hugely impressed. Otherwise, their best hope is probably fewer people playing the game.