Victoria 3

Money, what is it good for?

Political movements, loyalists and radicals:

also looks like we missed standard of living:

Song 1 (theme?)

Somehow the basic element reminds me of an industrial machine. Music isn’t a big part of a game for me, at least consciously, but some songs have stayed with me over the years.

Part 3 of the Unmitigated Pedantry discussion of Vic2:

Apparently the next DD will be about slavery. Vic2 is already way ahead of the EU series because enslaved people are at least modelled as people and not trade goods. It will be interesting to see how they plan to improve on the Vic2 model.

Interesting questions in the comments about serfs, penal slavery and slavery in colonies.

These dev diaries just tend to reinforce my opinion that Martin Anward is one of the best designers they have over there. For me the “golden age” of EU4 was largely under his watch and I thought he made some serious strides in making a Stellaris a better game when he took over after launch. He’s always worked on an existing project, though, so it’s going to be interesting to see how Victoria 3 turns out given that it’s “his” project for the first time.

Right now, dev diaries all seem well thought out and has me optimistic for the game. Lets hope it doesn’t get pushed out the door too early or something like that!

I am certainly encouraged that Martin is approaching the topic with appropriate seriousness and consideration. At the very least he seems aware of several of the major pitfalls. I wonder if he read the collection of unmitigated pedantry post, because he does seem to be on a similar wavelength.

I generally concur, and overall I’ve been really happy with the dev diaries. The main exception is the details of the pricing and market system. You have a complex design decisions that interact to achieve a scalable economic engine, but it departs quite a bit from reality and I worry that this kind of core thing can lead to other weirdness and mechanics built around that.

The main elements:

  1. Goods have a base price.
  2. No storage of goods
  3. Price is set by balance of production and demand
  4. Producers get paid price*sell_orders
  5. Buyers pay price*buy_orders
  6. Trade between markets places buy_orders at the source and sell_orders in the target
  7. If sell_orders is much less than buy_orders (currently < 25% !!), then everyone buying gets a scaling penalty.

An implication of 3 and 4 is that money can be created from nowhere if a good is abundant and money can be rapidly destroyed if supply of a good is less than demand. I understand the need to avoid the complexities of storage and price discovery and all the corner cases, but I think it will lead to eruptions of weirdness. For instance, the price ceiling right now seems to only be 50% above the base price - part of the reason I think is that consumers don’t have the option of just not buying. They pay for their demands even if the good isn’t available. So you can’t really allow the price to go to say 10x base, because the amount of money you would be deleting would be astronomical.

As much as we may want a bottom up market simulation with buyers and sellers interacting realistically, they can’t simulate every detail of every transaction at a perfect level of realism. If the results of the algorithm seem like a remotely sane outcome of underlying inputs, that’s a good enough system and better than most similar attempts have done in he past.

I’m sure Paradox still have a lot of work ahead of them balancing the economy, and we will see how it works out when the game is released (and then repeatedly patched over the years until nothing remains of the original design).

I share your concerns. Fundamentally you can’t save labor, or services but you can save goods. I don’t see why you couldn’t store goods. There should be a cost of store goods, or X% percentage rot away. Obviously X is much greater for meat and fruits, than coal.

The whole discussion of 3-6 seemed completely counter-intuitive and unnecessarily complicated.

It is really the only part of the other wise excellent diaries, that I was disappointed in.

It’s a lot of extra complications and I’m not sure it adds much to the end result. In real life, producers have a general idea of demand and try to not produce more than they can sell. Surplus either crashes the price and gets sold, or is destroyed. No one keeps giant warehouses full of unsold Laserdisc players in the hope they might eventually sell them off.

The exception is countries keeping stockpiles of strategically vital materials like grain and munitions, but that shouldn’t be handled through the economic simulation.

For sure there has to be an abstraction at some level. I’m not sure though that a more realistic mechanism isn’t feasible.

Pops already have an internal mechanism where they adjust their demand for goods based on the price, and try to find the lowest-price basket that will satisfy each need of their current lifestyle. If all economic actors had an ability to adjust their demand, and lower production and/or switch to alternate goods based on price, then you could have the makings of a more realistic price mechanism.

Each economic tick, the price adjusts based on the balance of supply and demand from the previous tick. Economic actors adjust their demand on smooth functions based on the price (and the price of other goods). You do another economic tick based on the new supply/demand balance. If a good is undersupplied, prices will gradually rise until demand equals supply. The gradual adjustment in prices simulates stockpiles filling up and/or draining.

To do this, buildings would need to be willing to gradually cut back on production if they are losing money due to rising input costs, rather than the current system where they just burn through their cash stockpile and then start cutting back on salaries. At high prices, goods in limited supply would naturally go to the most profitable industries and the most wealthy pops, as other industries and pops are forced to cut back or find alternatives. You wouldn’t have potentially vast quantities of money coming from nowhere or being dumped into the void. Producers of limited goods would be highly rewarded rather than having the price capped at only 150% of base.

Anyway, I’m sure they’ve gamed out all sorts of alternatives and there are some fatal flaws with the idea above, but the fact remains that the market clearing mechanism is a bit weird, and we can expect other weirdness to follow from it.

The flaw with the your way of doing it, or any way of doing it, is that whenever a designer (or more frequently, a player) goes “well this is how it works in real life, so let’s implement this behavior in the game”, it’s introducing new complexities and new edge cases to send the system off the rails. At some point you have to find a near enough approximation that gives reasonable results at the level the player notices.

I don’t really care what specific mechanics they use for simulating supply and demand, we know they’re going to change before the release, and change again after the game is out we see all the ways it’s broken. And the the more moving parts there are, the more broken it will be, that’s the nature of simulations.

I also like economic system that we saw in a few railroad games, Railroad Tycoon III, IIRC.

Producer put out the maximum they could. I think this pretty much exactly how most farmers operated, pre 1930, you plant all your acres and hope for the best. The excess supply would drive prices down, but there would be local surplus. This would encourage traders to purchase some of the supply and then transport it to some other location and sell it for a profit. Thus you end up a price gradient, the price of cattle would be really low near the ranch, and would increase as you got further away, being particularly high at stockyard.meat/ packing facility. The final product would be then shipped back to the town that had the ranch as well as other cities.

Building a railroad between the two points encourage both industries to expand.

It seems to me that best production economic system (albeit very limited) that Paradox has right now is Hearts of Iron IV, so I’d like to see them borrow from.

I do agree that system will undoubtedly evolve.
“All models are wrong, some are useful.”

Well, the whole argument is about what’s “near enough”. I feel that you are operating on a heuristic that whatever abstraction the devs chose is good enough, and not really engaging with any specifics at all. I am also skeptical that this mechanism can be easily changed. It’s very core to the game and a lot of downstream decisions have been built around it.

I love the HoI4 system as a war production model, but it’s pretty terrible as model of peacetime industry. I’m curious how they will model different generations of military equipment without exploding (!) the number of goods. I suspect it will be something like the new bolt-action rifle is more effective, but if your armies equip it they will need 50% more “firearms” goods than before. At the production side, new production techs will just increase throughput to match.

Edit: The Railroad tycoon system is very cool. At one point I thought perhaps V3 would have a very coarse-grained version of this, but I guess the complexity was too much. The devs found that even a few sub-markets within a nation was too much cognitive load, so considering prices and transportation (and weight of transportation) within each state would be quite a lot.

That’s about right. My feeling is that how the system works on paper is less important than the results it gives in the game, which we can’t predict until we see it in action. The minute details of how goods are bought and sold seem like an under the hood system that is interesting to think about but are not in themselves crucial.

I’m also skeptical that a fundamentally broken game can be fixed through patches, but that seems to be the Paradox method.

I definitely in it for the “interesting to think about” aspect!

For instance, if the penalty for only supplying 25% of the need for a certain good in my economy is just paying a 50% markup, that seems like maybe a good deal. You need fewer workers and capital to supply the downstream production. Except for the “money going to the void rather than circulating” aspect, which I suspect will catch up to you rather quickly but is hard to think about.

On the other hand, if you overproduce something, the extra goods are basically dumped in the ocean - people are doing useless labour. But at least they are getting paid for it? Extra money entering the system?

I haven’t followed this game that closely, so I’m not sure how it models production in the private sector which I assume will be the majority of manufacturing. For a producer, buyers paying a markup for goods isn’t a penalty but a bonus, and an incentive for competitors to get in on the action.

Sure, they’re getting paid, but it would be better for them to get paid doing something useful. For an interventionist economy, it might make sense to subsidize production as a form of welfare.

I need to read to re-read the designer diaries if I want to discuss this as it actually relates to the game rather than a high-school level understanding of macroeconomics.

That how it would work in a real economy, but for both of these, I think the money drain/injection effects will dominate. It’s not really easy to understand from reading the market DD itself, but you can piece it together from replies.

Anyway, as it stands, you could have say an iron shortage in your country, so you iron mines only produce 25% of what your industry needs. Let’s say the consuming industry is all steel mills. So your iron mines generate 25 units of iron each week, and your steel mills need 100 units of iron and 100 units of coal to make 100 units of steel.

Let’s say iron and coal are normally $1/unit and steel is normally $4/unit. Because supply is much less than demand, the steel mills have to buy iron at $1.50. So the steel mills pay $150 for iron this week. $37.50 goes to the iron mines, $112.50 goes to the void. But steel production goes on just as if the mills had gotten their full 100 units.

If the iron production drops to 20 units, then the steel mills will start to see production penalties of 20%, so will only be able to produce 80 units of steel, while still paying $150 for their iron ($30 to the mine and $120 to the void).

I think the “money to the void” thing is going to be a problem. You can have a situation where the steel mills are still profitable but the money leak will gradually be felt. Or maybe I am wrong and money leaks don’t matter at all?

So there can never be an actual shortage in input materials? If not enough iron is mined, it gets conjured from the ether as long as the buyer can pay extra? That seems like an even bigger issue than the money thing.

But again, it’s impossible to say whether or not the system works until we see the game running. I have a bad habit of liking these sort of games more as a perfect theoretical construct than a released piece of software with all the jank and imperfections, lets hope this time the final product lives up to its potential.