Fantasy Economics Blog Post

[Tetsubo 57]

A recent subscriber to my YouTube channel has shared with me a post they put up on their blog. The original is in French as they live in France. But he was nice enough to do a translation for me which I will include below. The original can be found here:

http://elromanozo.canalblog.com/arch.../19837215.html

I thought it was rather well written and brought up some good points. I am reposting it with permission.

*Echo-Gnomy, or "Economy in Medieval-Fantasy RPGs" :*

Since we're being hit by a recession, it seems only appropriate for us
to talk about a terrible disease that plagues most D&D style campaigns
(whatever your edition of the game, whatever your game for that
matter)... It affects all medieval fantasy worlds, and even others that
are far stranger ! It's everywhere, and I really don't know why it
hasn't been addressed sooner. Let's change that.

No fantasy game, to the best of my knowledge, offers a plausible
economy. I'm not even talking about something feasible, viable or even
somewhat realistic... Just something vaguely plausible. The systems we
are facing now in RPGs are... laughable, at best. It's not an economy
crisis, but it is a crisis of economy ! I'm not talking about the
currency, really... I couldn't care less if a gold piece is 10 or 20
silver : Whatever the monetary system, it's realistic enough. No, I'm
talking about real economy. It deals with value, not just money.

Am I qualified ? Well, I'm not an economist, if that's what you're
asking. However, I've bene roleplaying as far as I can remember, I know
my fantasy worlds through and through, I have a master's degree in
History (from the Sorbonne... If you got it, flaunt it !), and I know
quite a bit about the History of economy in medieval times. More
importantly, I know what I like when I play. It doesn't take anything
more to tackle the issue, for it is a very obvious one even a layman can
observe.

Just think about it for a minute. You'll see how enormously absurd it is...

The average village our favorite heroes (the PCs) will visit has a
micro-economy entirely based on the presence of one or more adventuring
groups. Often times, the village is barely a hamlet, or even a small
gathering of farms vaguely connected by a marketplace. However, it has a
tavern, a forge (specialized in arms and armor), a bazaar where you can
find every odd exploration tool you could ever want (including thieves
tools), and someone who knows magic items and maybe can sell some minor
ones.

The tavern always serves dwarven ale and elvish wine. Even in the very
******* of the world, near a sinister dungeon, a cursed forest, and
twelve assorted crypts and tombs in a faraway land, a village HAS to
have all those specialty stores... There's also a good chance that it
has a temple dispensing free healing, and an endless supply of rich yet
shady strangers who are eager to give out assignments to any half-wit
with a sword or any fireball-happy mage (claim a relic, protect a
caravan, eliminate some orcish threat...).

In the nearest town, it's possible to find great quantities of magic
items without any problem whatsoever, as long as you can pay for it...
OK, maybe not the most powerful or legendary items. But still, there
seems to be an endless supply of +1 Items, cure-light-wounds potions,
wands charged up with harmful spells, Remove Curse scrolls...

This is NOT an exaggeration. It's true about the MMORPGs and other video
games, it's true about many scenarios and campaigns, whether home-made
or not, for D&D... It's true for any number of Campaign settings such as
the Forgotten Realms and Greyhawk... And it's true, /a thousand times
over/, about the RPGA campaigns played for decades now for the D&D games.

In our own real world, in medieval times, textile and food were the two
main markets that made the world turn, and gave jobs to most people. In
our real world, if anyone could make and sell ANY sort if item capable
of curing wounds like that (that is to say, one item that can cure ANY
sort of injury), even if it could only be used once, even if it were
extremely expensive, this same item would replace the gold standard (or
whatever standard) in NO TIME. Magic, not precious metal or cloth or
food, would be the heart of the market... Much like information and IT,
high added value goods and services, are nowadays.

Incidentally, that's the sort of economy that's spontaneously created by
players in many online games (such as Dofus or others). Rather than
hitting monsters in dungeons, players "farm" resources from dungeons,
buy, sell, craft objects when possible, speculating on their value to
make more money to buy better stuff... More than just speculation, this
sort of thing leads to another issue : currency devaluation.

In Dofus, gold is a resource one can mine, and it's also, in theory, the
metal used for making gold pieces, obviously (the Kama, the in-game
currency). However, it's become less cost-effective than mining other
metals or gathering other resources in order to create magical items
(you're able to do that through specialized skills, in-game) and selling
those items. Those items are destined to be sold, and are seldom used
for anything else, since they're not that powerful : they're a new
standard, serving as a new currency.

Something similar should occur, over time, in pen and paper fantasy
worlds... But doesn't.

Questions : How much gold, exactly, is buried in the dungeons visited by
adventurers ? How much has been unearthed, and then injected into the
economy ? What's the impact of the adventurers on the quantity of gold
pieces in circulation ?

In D&D, a single dragon's treasure is about 4000 gold pieces, minimum (a
conservative estimation, for a dragon that's not too old and with a GM
that's very reasonable). That amount of money alone would completely
destroy the economy of the average village, by massive cash flow. Taking
into account the amount of ruins and tombs replete with monsters and
treasure regularly "cleaned out" by adventurers around Myth Drannor,
gold should be near worthless.

Inexplicably, however, a backpack still costs only 2gps, and the average
worker's wage continues to be a few copper pieces... And so on.

Even without a dragon, the impact or a single experienced adventurer on
the economy of a village is crucial. Consider this : A peasant may earn
10gp a year with his crops, tops. A non magical sword, which we will
consider as the basic adventuring tool, costs 50gps. The lowest price
for ANY magical item, even minor ones, is around a hundred gold pieces.
Every adventurer returning from a dungeon sells, buys or pays for the
repairs of many a piece of equipment, several times a week...

See what I mean ?

Adventurers arrive in town, clean out (or so they say) the monstrous
threats on the communities, spend whole carts of gold pieces... And yet
the villages remain eternally poor, even though they're able to buy or
make expensive equipment... the dungeons are eternally infested with
monsters and filled with treasure, even though they're regularly visited
by adventurers... And prices remain fixed.

10gp a short sword, 2gp a dagger, 5sp for rations. Unchanging.

The question one is bound to ask now is... *Why such a system* ?

Well... Because.

Economy is like sausages... You're happy to have money, but you don't
want to know the details. Honestly, one doesn't play a barbarian or a
mage to examine the finer points of finance. Is the GM expected to come
up with realistic price fluctuations and estimations on the buying power
or the average commoner in proportion of what loot the PCs gather ? I
should think not. Simply put, it's difficult and it's boring.

No one wants to simulate a real economy, no one wants to change the
gaming system, and no one would buy a game in which a whole chapter
details supply and demand... The rare games that tried it made it an
optional rule that never convinced anyone. We must therefore find ways
to minimize the absurdity or the system and justify this status quo of
economy...

One has to understand that prices are fixed for a very good reason in
RPGS... At least for common goods. How would the beginner adventurer
start out otherwise ? Prices are calculated to be accessible to the
beginning adventurer, and to be proportional with goods and services
such as a night at the inn, rations, the minimum wage of a worker for a
day, etc. As for the price of extraordinary objects, such as magical
ones, they are... extravagant, of course. No one could possibly pay that
much in gold... But it's in proportion with the rest. It's artificial,
but it follows.

Now, we still have to justify the base, the reference prices... The
usual excuse is "historical realism". Yes, it is ludicrous, especially
in a game with dragons... But that's what people have been saying.

In many countries in the European middle ages, the nobility and military
are the only social classes able to bear arms, by law. It was a control
measure to avoid the proliferation of violence, as well as to avoid
having well-armed peasants in case of an uprising. In many medieval
societies, this control was implemented through custom, through royal
edict or law, or through taxes and high prices on metal weapons.

Furthermore, in a medieval society (without any means of mass
production), a sword or an armor is a luxury. Unlike a mantelpiece or an
iron poker, or even a simple mace, a sword has to be finer and
sturdier... It has to be made with better care than a plowshare. In the
same fashion, a metallic armor is often made to fit, especially, on a
single order basis, either for the local lord or for his soldiers.

A slight flaw in an armor or a sword means that the owner has fewer
chances of survival... It follows that such an item should be more
expensive. And even in a "normal" medieval world, arms and armor are the
most technologically advanced items of their time : the smithing
techniques necessary to obtain sturdier or lighter alloys are often
arduous, experimental at first... And they're well guarded trade secrets !

Most "expensive" metal objects often require special materials. I'm not
even talking about gold or precious metals... In the middle ages, simple
iron is expensive, hard to get (it has to be mined and refined from the
ore). It's a precious commodity, and some regions have to make do with
wood for all the common metal objects we take for granted (cutlery,
plates, nails, handles, hinges... everything !) because iron is such a
luxury. Since it's so precious, a peasant could find a thousand better
uses for even a small quantity of high quality metal than a paladin's
sword... Uses that are both easier to forge and more pressing for the
general population, such as plowshares, horseshoes or gears for a mill !

In a fantasy world, it's all too logical that magical items, even more
useful and made from even rarer materials by even more specialized
craftsmen, should be proportionately more expensive.

Let's also correct one common misconception : Even if minor magical
items are common for adventurers, it doesn't mean that they are
/produced/ in great quantities, or on a regular basis. Sure, there are
more than enough for every adventurer... But adventurers are a
/minority/ of a gaming world (one doesn't dare use the word "elite"
after looking at some munchkin players out there).

We must place the average PC in its correct demographical context. Our
heroes are... Heroes ! They're not exactly a dime a dozen. We play these
games to act out remarkable people, their characteristics are
remarkable, so it follows that they are but a few of them in their land.
Sure, there are hundreds, thousands of adventurers everywhere in the
RPGA, or in online games, much more than "normal" people... It's
abusive, but it's true...

However, this doesn't have to be the case for YOUR campaign world, for
YOUR home game !

I other words, this doesn't have to be your problem.

Let's also place the items in context... Adventurers use large
quantities of magic items, especially violence oriented ones, such as
protective gear or magical weaponry. They have to, it's their job.
Otherwise, they'd get killed. Nothing wrong with using magic like that...

However, it's still a niche market. Economically speaking, the price of
a magical sword bears little direct influence on the market as a whole :
A magical sword is of no use whatsoever to a hefty majority in the
campaign world... It's a highly specialized tool for hurting monsters.
If that's not your job, then what good is it to you ? Outside of the
"adventuring market", most items should be impossible to sell.

So what do we do with them ?

Well... First of all, in my opinion, the GM shouldn't distribute them
like candy. If they're impossible to sell, there are no magic items
catalog, players may NOT order the crafting of magical items in just any
blacksmith's shop... Even if it could be done, it would take a
tremendous amount of time just to gather the materials. I think it adds
to the game if even a +1 sword is something you find, or something
rather legendary (locally) in its own right, rather than "just a +1
sword the Smith made for adventurer X". Finding the ideal magical weapon
could be a quest in and of itself. Magical weapons are, in stories, rare
and wondrous... The stuff of legend. This way of seeing things is one of
the only ways that keep the fragile game economics somewhat balanced.

In my opinion, it is imperative, in order not to fall into a guilty
routine, to find alternative rewards for player characters... Especially
since giving fewer rewards could be problematic if you've already
started the candy distribution in your campaign and don't know how to
stop it ! Don't worry, there are many ways to "pay" adventurers for
those who don't want to give out money or magic.

What's that ? Do I hear someone snickering and murmuring about sexual
favors ? Dirty birdies !

Yes, sex is a possibility... But what about gratitude ? A favor owed by
a high profile NPC ? Or maybe a knighthood, even if it doesn't come with
lands (a fief is the proper term, but I didn't want to lose anyone
there)... It could even be simpler : A discount in certain stores, or
the simple possibility of entering a certain clubhouse, being friendly
with the local guardsmen, having the local innkeeper feeding you
information on a regular basis because you saved his life...

Payment could be the mere possibility of acquiring magical items
(potions or scrolls) from someone who ordinarily makes those for his
personal use only... The PCs then would have to pay for those anyway.

Beyond that, there's always payment in nature : cattle, horses,
chickens, meals, raw materials, common items... Payments that can't be
refused, mostly made by merchants or simple townsfolk who do not have
anything else with which to pay... A thatcher could offer barrels of
tar, an innkeeper could offer a rare wine or barrels of ale, a tailor
could offer tailor-made clothes or even dyes, a merchant could offer a
small box of spices (very expensive and rare in the European middle
ages), or could offer a quantity of useful objects such as rope,
canteens, bedrolls etc. to equip the characters for years... Let's face
it, there's probably not enough gold in the whole village to fill the
purse of the PCs even if the villagers were willing.

Payment could also be something easily regulated by the GM, such as
something one cannot carry in a pocket or a backpack... Cows, for
example... Or a house built by everyone in the village so that the PCs
"will always have a home here". A peasant could offer his daughter's
hand in marriage (whether she wants to or not)... All those things are
impossible to sell and very difficult to refuse without hurting people's
feelings.

One should favor payments that are plausible and that have a strong
emotional impact ("damn, those people are really giving us all they
have..."), while retaining a weak economical impact. Offer something
which has a sentimental value... Offer a heirloom. Offer knowledge : a
skill the PCs could learn, a story for the bard, local legends for the
mage...

And, every once in a while, offer money, and/or a magical item.

If a magical item is indeed present in the village, then the PCs may
find out about it and buy it, even if they have to save money to do
so... But what about re-selling magical items ? As we've said earlier,
peasants don't care about magical swords, and have better things to
spend their money on... Merchants might be interested, but do they carry
thousands of gold pieces around for just that purpose in a town where an
ale costs less than a copper piece ? Not likely.

It may be possible to trade a magical item for the equivalent in goods,
which is more logical than money... I mean, who, apart from nobility or
the adventurers themselves (who often have platinum pouring out of their
pockets), has the dough for that sort of thing ? A single magical sword
could buy an entire village, including its inhabitants if slavery isn't
abolished !

It follows that the exact price of a magical item should be very
difficult to estimate. It's so very astronomical for most people, it's
more money they could ever see in their whole life, more than they could
count ! Most shopkeepers won't have any idea of its real value. To them,
simply put, it's /priceless/.

Therefore... Why would a commoner /sell/ a magical item if he happens to
find one ?

The very rarity of the thing would probably make him keep it. He
probably wouldn't use it, but he'd save it as some sort of heirloom, a
family legacy that goes with a story... Not just the cliché magical
sword on the mantelpiece, but any magical item. Anyway, adventurers
being a minority and magic items being a rarity, they wouldn't have any
opportunity to sell it, most of the time.

Even then, there's a risk of magical "inflation" around the PCs as they
go up in level. The GM could always strip the PCs of their gear again
and again, after a certain level, they will have to have the "tools of
the trade"... Were it only because the monsters need magical gear to
pose a challenge.

In that context, another way of limiting the "magical proliferation" is
for the GM to state that there are *no magical shops*. Ever. Period. Not
even for potions and scrolls. Those items have to be found or crafted,
or traded with rare people versed in such arcane arts, and that have
come to trust the PCs. Even then, the PCs will probably have to gather
the special ingredients.

Even the wizard's spells cannot be bought or sold, but must be
personally researched, found in old tomes, or learned from a
sufficiently trustworthy colleague in exchange for another spell, or
something else. There are no magical schools, no guilds to speak of, and
very few magical societies or orders... Only masters and apprentices.
Magic is too rare for anything else to be viable. This allows a GM to
limit the impact of magic on the economy, and on society in general.

I'm not saying this is the only way, or the best way, or that you HAVE
to do it... But I am saying that it works. It works in Warhammer, it
works in some D&D worlds. It's one way of looking at things... Another
point of view is Forgotten Realms, with its common magic, or Eberron...

In the Eberron campaign setting (a world I really like, just like
Faerun, I wanted to make that clear : I'm not adamantly defending the
"rare magic" point of view), magic is omnipresent, and society as a
whole has been altered by it. People travel in flying ships or in
hover-trains propelled by magical lightning over arcane railroads, build
skyscraping towers held in place by metal beams subject to levitation
spells... There's even a race of magical robots, the Warforged. Economy
is the least of a GM's worries, in that world...

An abundance of magic items isn't a threat on the economy : It adapts,
it has to... But it does change society. It is indeed a threat to the
medieval "feel" of a game. Even if only the very rich can afford it,
cure spells and instant communication through magical means change the
whole deal. Just look at what antibiotics and cell phones did to our world.

What if you can buy resurrection, even for thousands of gold pieces ? It
means that the very rich no longer die, and can only get richer. What if
teleportation is available to rich merchants ? No more caravans, ever,
or only for the "little people". Suddenly, being a mage or a cleric
becomes THE most attractive career for youngsters everywhere, pushed by
their parents, eager to enjoy the benefits of social mobility. In a few
generations, the number of mages increase exponentially, and magic
become more available... more common...

Think about it : in Pathfinder or D&D 4, a simple apprentice is able to
cast a Cantrip at will. /At will/. Anything that you can do at will and
that no one else can do is worth a lot of money... Even if it's just
lighting a fire with a magical sparkle, amusing kids with minor
illusions, keeping the beer cold with a freezing ray, or unclogging the
latrine with a little acidic burst...It's worth some money. At least
until the market is saturated... Unless the gift of magic itself is a
rare thing.

But enough with that... I should return to the subject at hand : Economy.

Another solution to explore for the GM is to limit the quantity and flow
of cash, and play with price fluctuations. For expensive objects,
realism suggests that their price fluctuate, because not everyone will
be ready to pay the same amount, and not all the time, for every object.
Realism also suggests (as we have seen) that payment cannot be made in gold.

Gold uses space, gold weighs quite a lot, and there just isn't that much
gold in circulation in any city.

Remember, only the King can have coins made, that's why his effigy is on
them. In History, organisms that emitted their own money in competition
with the state, such as the knights templar, had a bloody end... be sure
to check what's the most practical and common means of payment for your
PCS, in your campaign world. It should be the copper piece. If it's
gold, the situation is serious but not desperate... if it's a short
sword or a +1 AC ring, you're in deep ****.

Copper is the most abundant metal for coinage, followed by silver, then
gold. Even in basic D&D, gold isn't used for many transactions : To pay
for a dagger (2gp), most people would carry 20sp. Only adventurers, rich
merchants, guild-masters, high clerics and nobles use gold regularly.
For large payments, worth thousands of gold pieces, gold just weighs too
much and there's not enough of it. So rich people use platinum,
objets-d'art, services, favors, and, of course, gems... However, all
those things have to be evaluated first by an expert, and that means
their price may vary !

If you want realism, a favor, an objet d'art or a gem doesn't have a
fixed value. The rules even say so : Prices listed are here as an
indication, and may vary ! No gem is like the next one, and even if one
admits the (highly unrealistic) fact that, to minimize the GM's
headache, in the campaign world, all shopkeepers sell at roughly the
same prices wherever they're from, one has to concede that prices are
but an approximation.

Furthermore, gems and objets-d'art are in and of themselves very
expensive... SO these are objects for which most people will pay... by
trading other objects !

Example :

Grabgorethe Mage finds a diamond. His thief companion makes a skill
check and says it's worth 500gp. They think it's worth /about/ that. Who
knows, really ? Even in a large town, letting the word out to gather the
rare buyers who are ready to pay for such a diamond, who /need/ such a
stone (to make a jewel, for a magic spell, to collect, etc.) and who
have enough /gold/ at hand and on their person in spite of thieves, this
takes time. It takes even more time (and money) to organize an auction.
The adventurers could contact a jeweler, and exchange that diamond for
another gem or jewel hat would be more easily sold, but that would also
take time (and the necessary contacts), and the jeweler would have to
earn a profit from the transaction, therefore trading the diamond for
other gems or lesser total value... Our heroes need equipment ASAP to go
back to the dungeon, so they decide against it. They'd like to trade the
diamond for equipment... They contact merchants rich enough to be
interested in such a transaction, but few of them have enough food,
horses or common items at the ready and in the proper quantities for
500gp worth of trade. 500gp is ten greatswords. It's also one masterwork
greatsword, but one would have to have it forged especially, and that
requires months... And of course, the blacksmith doesn't agree with the
thief's estimate, and doesn't really need a diamond anyway. Our heroes
are starting to lose patience... They need food, rope, horses, leather
goods, and no one in town seems interested in a diamond... Everyone
wants silver or gold ! The adventurers have to consider the fact that
they might very well starve owning their diamond, if they can't part
with it fast ! They end up finding a caravan owner who accepts the
transaction... For a fraction of the diamond's price, such as 200gps in
horses and materials. Why ? Because the caravan owner knows he has the
adventurers by the balls, that's why. They won't find a better deal
elsewhere, unless they're willing to wait for opportunities.

And of course, prices fluctuate from one country to the next, one
kingdom to the next. It's not necessary to do it, but it adds a touch of
realism to a scenario. If the PCs find themselves in an exotic land, why
are the same products available at the same price ? Spices, for example,
while very expensive in their homeland, are be considerably cheaper in
southern tropical lands where spices actually come from. After all, what
good are caravans if prices are the same everywhere ? You might just as
well call them simple movers... In a world devoid of any means of mass
production, even more than our own, no two cities should have exactly
the same prices.

A clever GM could introduce small variations in the prices from one city
to the next, one merchant to the next... How so ? It's very simple.
Lower or raise them randomly. Your players don't have to understand
supply or demand, they don't have to know why prices are high or low...
maybe a shipment of such and such material has been delayed, maybe
another one has arrived early, whatever... The PCs aren't merchants.

You could even be a little more logical : Raise all prices at the inn if
there's a festival in town (tourists are here, there's not enough rooms
for everyone...), lower the shopkeeper's prices if this region is poor
(no one can afford to pay much), raise all prices if the whole realm is
prosperous and if its money serves as a standard for other countries...
And don't forget to give discounts to PCs with a great reputation for
heroic deeds.

It shouldn't be too difficult : inflation is common enough nowadays. Use
that...

Even without crisis, you could lower the prices of local products, raise
the price on imported goods, raise the prices if the shop is very
reputable... In many games including D&D, there exist masterwork items,
usually ten times as expensive as the regular ones. Why wouldn't there
be "masterwork" groceries ? Masterwork meals ? Exotic fruits,
confections and pastries, fine wines, exquisite cheeses and dishes...
They are delicious, they're rare, they require skill, therefore they're
more expensive.

Those items, although destined to be consumed only once, could even
serve as payment or reward for the PCs... And, of course, they could be
the very reason for an uncommon mission : Who's going to deliver the
fine wines and chocolates for the Baron's daughter's wedding, protect
the caravan and watch over the snotty foreign chef, in that faraway
baronny riddled with an Orc problem ?

But let's go back to our average village...

Remember that one ? the one with the tavern, the armory, and everything ?

The village in peril is a cliché of RPGs... Who hasn't exterminated rats
in the cook's cellar, or defended the farm against goblins and wolves,
eradicated orcs in the forest, expelled the gnolls from their camp and
foiled the machinations of a necromancer or demonic cult that just
happened to be active in a nearby tumulus ? It seems like those
villagers are in need of constant saving !

Why, oh why do they live here ? Seriously who would build a village near
such a forest, such a tumulus, /et caetera/, in the first place ?

Maybe the village was there first, of maybe the "evil" only recently
awakened, or maybe they didn't know... But that's no excuse not to
leave. Maybe it's the same everywhere in the campaign world... Or maybe
the GM has to do better than that !

The GM should come up with a reason other than "it's home" for the
people to stay... Because in reality, often times, it isn't enough.
there has to be something to compensate for the loss of life, limb,
crops and money to the local monsters. Maybe it's religion, maybe it's a
special place, maybe the villagers want to stay here because it's the
only place where they can follow their own laws and customs, maybe it's
because the land is exceptionally fertile... Maybe the local duke or
baron allows the people not to pay taxes for a few years if they settle
in "fallow" lands, as a program to expand and civilize the countryside
and get rid of the monsters, as well as developing the population and
its economy.

But there's more...

This isn't just a bunch of farmers, this is a village for adventurers.
Okay, so there's a tavern... there would be one anyway. But it wouldn't
be as well supplied. There wouldn't be mission-givers, or shops
everywhere ready to sell adventuring gear... Who would need all this
apart from adventurers ?

Well, that could be a reason. Adventurers are rich... Very rich.
Proverbially so, perhaps. Even if they're a rare breed, a village
"lucky" enough to have a dungeon nearby attracts them like flies. It
should be worth something to adapt to this very eldritch clientele...

We're now entering the very weird domain of *Dungenomics*, a world never
better presented than by Jared Hindman in his D&D column.

Even if the village is far away from any civilization, it's worth it for
them to carry specialized items, serve elvish wine and dwarven ale...
The heroes are rich, and there's no competition for miles. Incidentally,
a common mission could be protecting the heroic caravans who supply the
shops...

It's just like when a town has a remarkable feature or monument : it's
worth it to make accommodations for tourists. Or adventurers. It's the
same thing, really : they're loud, they spend too much, they brawl, they
break the furniture... But it's worth it, because they carry a thousand
times the minimum wage in adventuring gear.

You know the guy in the cloak who gives out missions at the inn ? He
pays his room by the month, just waiting for adventurers. The sage near
the fountain who identifies magic items ? The rags are just for show :
he has a good home and pays his taxes. The blacksmith imports exotic
metals, but he can afford it : Each sword is worth a hundred times what
he makes with four horseshoes. Every now and then, an adventurer orders
something special, and he earns in one time five years worth of salary.
It's an opportunity to be a better blacksmith, to cultivate a
reputation... He also has apprentices, he pays them, and he teaches them
a craft. The priest doesn't just marry and bury people : he's had a
crash course in potion brewing, and earned in one week enough money to
repair the church's roof... It's 50gp a minor potion, made with local
ingredients the adventurers are only too happy to collect for him (at
their peril) in exchange for a small discount... Maybe he's even
recruited a novice as well.

PCs mean business... But it has a downside.

Such a village /needs/ adventurers to inject cash regularly, in the long
run... And if the adventurers are so efficient, why would they need to
come back ? It follows that the village needs monsters, in a very
paradoxal yet symbiotic relationship...

A cunning mayor would do well to preserve a few kobolds or giant bugs to
"seed" the surrounding area every year or so, or to be very careful to
hide some of the "nests" to the adventurers who come to "help the town".
It's a delicate balance, and one that must remain a secret at all
cost... Unless...

Well, let's take an example from the video game Baldur's Gate...

Local farmers are assailed by Ankhegs, subterranean monsters... They ask
adventurers to get rid of them, but to leave some of them alive... they
just invent some pretext, such as "Ankheg dung fertilizes the ground",
or something like that (as if regular worms weren't enough), and that's
all there is to it. The blacksmith does business crafting Ankheg hide
armor, the innkeeper hosts the adventurers, the shopkeepers are happy,
and the whole village lives partly on the "golden Ankheg"... But you
can't give the whole truth to the adventurers, otherwise they'd kill all
of the critters.

I went even further, once, and conceived for my own campaign setting an
whole medieval city (spoof of another very well known fantasy city,
whose name I will not utter here...) surrounded with tombs and tumuli,
dungeons and ruins, a cursed forest, unexplored lands nearby, and a
sewer system full of monsters... The whole city had built, through
careful planning, its prosperity over the "adventuring business".

There was a special "adventuring quarter" with shops and craftsmen,
temples, magic shops (eh, there's no need to limit yourself in such a
setting ! the people are motivated to produce magic /en masse/...) and
taverns designed for their comfort. There were even special boards and a
special page for "adventuring jobs" offers and demands... The city hall
had maps in circulation that channeled a majority of adventurers towards
some of the known dungeons, giving other dungeons time to replenish
themselves... the authorities also made money with VAT on loot, and
controlled somewhat the adventurers traffic through a law that made them
register and fill out a form for every expedition, "in case they don't
come back, to give word to the family, organize a rescue party...". I
would have added an insurance policy, but it would have been too complex
for everyone. The city being prosperous, more adventurers flocked to it
in a virtuous circle... the high mortality rate in the dungeons kept the
adventurers manageable, and the dungeons filled with enough magical gear
and loot, while still dissuading most people to become long-term
adventurers.

And all this thanks to well devised urban planning !

In the end, adventurers might become aware that villages and towns cater
to them... This is weird in and of itself, but it's only logical. It
also raises more worrying concerns, such as the existence of
*Stabbing-towns*, as described by Jared Hindman in his column... Which I
urge you to read.

In conclusion...

I for one like a touch of realism in my game, or at least
plausibility.I'm annoyed when it gets hard to suspend disbelief in a
game session... I'm annoyed when the reactions of the NPCs are off, when
the geography is nonsensical, or when I can't believe some of the
details. Why would the economy be any different and be treated with less
plausibility than the rest of the gaming universe ?

I know, I know, it's boring. But, let's face it, it's no more boring, to
some, than the notions of weapon crafting, psychology, geology,
geography, history, physics, math or chemistry that some geeks and nerds
(and I say that with utmost respect, being one myself) show in
conceiving their worlds, their house rules, their stories.

What we just saw here is, plainly, that you don't need to peruse through
long texts about macro-economy and commerce to add a little realism to
that aspect of the game, the same way you don't need game theory to
understand how to play D&D.

It even allows for unexpected challenges, deeper games, more involving,
especially to players who are used to villages who behave as a whole
like damsels in distress and have all the commodities they could want...
In my opinion, "unexpected challenges", "deeper" and "more involving"
are always good in an RPG.

Some have said that the economy is but a minor aspect of the game, and
that it's not worth all that din... I find such assertions lacking when
I see that some players like nothing more than haggling for magic items
and equipment in between adventures. I hope I convinced some of you
that, although ignorance of those financial matters can be perfectly
fine in certain campaigns (it is a game after all), it can be an
opportunity when it is often considered an issue.

Isn't it more interesting ? Is it really that much more complicated,
when you don't even have to do that all the time ? It's another type of
adventure, a business venture where the big warrior with his big sword
has to be careful, for he may not be as rich as he thought, he may not
be as powerful as fast as he thought, he may have to weigh the
consequences of that bar brawl if he wants to drink again in town, and
he may have to pawn that masterworklongsword for a hot meal some day...

I say anything that lets the PCs face the consequences of their actions
can only add to the game.

[jpreem]

Good read - i was intrigued by the term *stabbing towns* but could not find these in Jared Hindmans webpage ( headinjurytheatre) I would be interested in reading this column - if anybody is better at google plese post the link.

[DonDuckie]

I read it. It was interesting.

I like many of the ideas and theories, and they will change how I create worlds/scenarios henceforth - thank you for that.

But personally I don't seek to change what is to fit my explanations, I much prefer to change my explanation to fit the described situation. (eg. exspensive stuff like that is made to order, I think most things take about a day to make - D&D).

Another thing I'm very fond of is: it's not coins, it's pieces. And it's worth something because it's expended(annihilated) when crafting magic stuff. So there is always a demand for it, and 'the Age of Less' is not upon the world yet.

Very enjoyable. Especially since I had oppotunity to present some of my views on fantasy economy.

[Cogidubnus]

I don't have time just now to read your whole post, but...

Firstly, in my games villages don't have those facilities. If you're not in a city, you've no chance of hitting on decent smiths or merchants. Even once you're in a city you need to Gather Information to find a merchant who'll deal in magic items.

Secondly, gold is hard to devalue, because it isn't, like paper money, a representation of goods - it is the goods. Gold currency is an exchange of valuable goods. And because of some strange allure of gold, people always seem to want it, even when it's comparatively common.

Anyway, I'll come back and read the rest later.

[true_shinken]

I just started reading, saw it wasn't really about economics and decided not to read the best of it. It also fails while describing a hamlet having stuff it doesn't need to have and won't have in any good game.

[Yahzi]

No fantasy game, to the best of my knowledge, offers a plausible economy.

I think I did a heroic job of justifying the existence/distribution of levels and pay scales for peasants to lords in D&D here. I explain why prices are standardized across the world, and in fact my world economy is built on the one resource that actually matters: XP.

Also, of course, see Frank & K's brilliant Dungeonomicon..

Of course, in commercially published works, it is true that this issue is handled laughably. It would appear that no one cares enough about the issue to pay for thoughtful consideration. Which reveals a certain amount of economic wisdom on the part of the publishers...