Exalted Orb Decay - A tiny change with potentially very large impact to the economy

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Hercanic wrote:

@Nurvus:
A lower supply than demand raises the price, yes, but a higher price lowers demand.

Lowers the quantity demanded, the demand curve does not shift.

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DaemonMonkey wrote:

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Hercanic wrote:

@Nurvus:
A lower supply than demand raises the price, yes, but a higher price lowers demand.

Lowers the quantity demanded, the demand curve does not shift.

You must also consider the speed at wich information travels, and the psychological factor of scarcity in a gaming scenario.

Players will be more willing to part with virtual currency (game) than real currency (the foundation of those thesis/theories/studies) when demand shortens.

After a while, some players may accept the fact the supply is lower and try to adapt to it, but it takes time, and rarely stabilizes at the same value as before.

In the brief period players are willing to pay more for something that lowered in supply, the hoarders can then sneakily sell things in large droves, for a higher amount than before.

Each of the players that buy for a higher price are now in possession of what they individually believe to be a highly valuable asset, when in fact supply was only temporarily lowered and it's value should be the same.

Since the totality of the supply is then cornered to a few demanders, all other demanders retain the impression of scarcity, and gradually may (or not) accept to continue paying the higher value.

Furthermore, as a value becomes accepted by more people, more and more will adhere to the new value, and plan accordingly.

It's somewhat of a snowball.

The curve does change, but doe to several intertwined factors.

Economy isn't a machine with perfect reaction times.

@DaemonMonkey:

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DaemonMonkey wrote:

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Hercanic wrote:

@Nurvus:
A lower supply than demand raises the price, yes, but a higher price lowers demand.

Lowers the quantity demanded, the demand curve does not shift.

The demand curve is shifted by non-price determinants, and I'm talking about price determinants, so saying price doesn't shift the demand curve is neither contradictory to what I said nor relevant.

"Demand", which is what I said, and "Demand Curve", which is what you brought up, are two different concepts. I did not say "a higher price shifts the demand curve", in which case your correction would have been warranted.

"Quantity demanded" and "Demand" are functionally identical in this context, but using such specific economic jargon would not have served my point on a gaming forum. This isn't Economics class.


@Nurvus:
You quoted DaemonMonkey, but that's quite a bit to say over one sentence. Are you directing any of this at me?

No No No, a thousand times no. I'm going to lump you (the OP) with the same people who, when every random-ARPG comes out, immediately come out of the woodwork with cries of, "Make the game harder! Delete or drop all of my equipment when I die! Punish us more for our mistakes!"

If you want this game to be able to invalidate hours and hours of your time, go play hardcore with the other dummies. Just be sure to delete your characters when you die (POE is way too nice about that.) Leave me out of your self-flagellating schemes.

@Hercanic
I have terrible aim.

It was mostly rambling.

I usually argue against absolute statements.
Where it comes to people, specially players, each case is a different case.
We can speculate, but I don't think it should be done according to economical laws that apply to real money.

That's pretty much what I meant to tell DaemonMonkey with my post.

CanHasPants has asked me to comment on this thread, which I've been putting off due to mixed feelings.

See, each suggestion consists of two key parts: identification of a problem, and a proposed solution to that problem. Even if a suggestion does not explicitly go through the identification step, it at least implies a problem which it is trying to solve.

And I definitely agree with the problem-identification step here. The Exalted Orb's use as a currency has become a problem, and as a result hating on it is in the best interest of the game. Me and PolarisOrbit have gone over some reasons why this might be so in a Beta Feedback thread, Thoughts on Trading (let's just focus on the problem-identification step part here, not on any proposed solutions). Because I agree a lot with this stage, part of me has wanted to see this thread succeed and grow. I've been monitoring it with some pleasant surprise.

However, especially now that my feedback is requested, I'd be remiss if I said I agree with the proposed solution. Giving a decay to Exalted Orbs doesn't just screw over traders, it screws over crafters, too. And when you start asking which group it screws over more, the answer to that question is very disturbing.

Let's say you're the type of player who's on almost all the time, like, oh, Kripparrian. By this point you have access to all sorts of good Exalt-able items, and perhaps more importantly you have access to all sorts of people, a friends-list full of fellow no-lifers who are also on almost all the time. So whenever you find an Exalt, you can use it on one of those Exalt-ables, before it would decay; if one of your friends finds one, he can trade it to you before it decays, getting a good deal from you, and you can then use it before decay. For you, the effect of the delay timer is minimal.

Compare this to the player who isn't online all of the time, a player who actually has a life outside of PoE. You don't have a stash with Exalt-able items in it, so if you found one, you would likely blow it on something undeserving before the timer ran out. You don't have a friends-list full of friends who could use an Exalt before the timer ran out, so you couldn't get as much for it in trade; or worse, you unload it on a mass-advertising no-lifer like Kripparrian for a fraction of its true value, since only the elite benefit from buying. You are hit with the full brunt of the delay timer's wrath.

This suggestion doesn't punish trading any more than it punishes crafting. What it does is punish casuals, while failing to punish no-lifers.

That said, I really admire the intent and the dedication behind the people involved in this thread. You may have been barking up the wrong tree, but you were doing it for the right reasons. I don't want you all to feel discouraged. That's why I've been putting this off.

I hope you stick true to your identification of the problem and find a solution that feels right to you.

Thread is TL:DR.

I don't know if this has been brought up already, but the only way to balance Exalts and other orbs is to make them obtainable through a vendor recipe, no matter how absurd. For example you can vendor 10 GCP and get one Exalt. Make it 20 GCP, whatever. At this point the Exalt has a finite value but there is no risk of loss due to this decay idea.

Just my 2 alts.

agree 100%

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Raligard wrote:

Thread is TL:DR.

I don't know if this has been brought up already, but the only way to balance Exalts and other orbs is to make them obtainable through a vendor recipe, no matter how absurd. For example you can vendor 10 GCP and get one Exalt. Make it 20 GCP, whatever. At this point the Exalt has a finite value but there is no risk of loss due to this decay idea.

Just my 2 alts.

The only orb -> orb recipes should be to exchange a higher value orb for some combination of lower value orbs. Upward mobility within recipes would undermine the things that are good about having a free market. The only way (I can think of) to control market manipulation is to make trading orbs undesirable as currency, and desirable as tools for crafting.

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Hercanic wrote:

@DaemonMonkey:

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DaemonMonkey wrote:

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Hercanic wrote:

@Nurvus:
A lower supply than demand raises the price, yes, but a higher price lowers demand.

Lowers the quantity demanded, the demand curve does not shift.

The demand curve is shifted by non-price determinants, and I'm talking about price determinants, so saying price doesn't shift the demand curve is neither contradictory to what I said nor relevant.

"Demand", which is what I said, and "Demand Curve", which is what you brought up, are two different concepts. I did not say "a higher price shifts the demand curve", in which case your correction would have been warranted.

"Quantity demanded" and "Demand" are functionally identical in this context, but using such specific economic jargon would not have served my point on a gaming forum. This isn't Economics class.

Sorry, I didn't mean to come off as correcting you. What you wrote is correct and insightful. I find it very helpful to always keep in mind the difference between what determines the value players place on an item and what determines how they respond to price changes.

I'm an econ student, everywhere should be economics class ;)