Is the price of food too low?
Gali.
Vikings coming to raise your food prices!
Have you noticed that selling food makes you approximately 00.00 GBP? Well me and Madelina de Melrose have been trying to show the rest of congress that the prices need to be upped!
Initially Madelina stated that selling goods made you next to nothing, especially foo
😛"What we need to do first is get the markets back to some semblance of sanity where it pays to make goods. I know I've long since shuttered my (low level, until I amass a horde of shiny yellow stuff) factories, for I was losing money on them. Because I rely on a salary and sales of raw materials I mostly only do the 25 "daily order" fights, for I can't afford to buy many weapons. And the ones I can make are generally next to useless, so that's not a viable option.". I then said that I agreed with Madelina, saying that we needed to focus more on bringing up food and raw material prices than BaronChris' original idea* of lowering the average wage. This was however met with a bit of scrutiny...
Mr Knee then responded by rightfully stating that raising the food prices would only help the sellers, would put the newer players at a financial disadvantage and that people would simply import foo
😛" The problem with trying to raise the price of food etc is that newer players then struggle to replace any food eaten themselves. Looking to raise the prices is only goof for the sellers and screws the buyers who use more food and weapons they produce.
Plus if you raise the prices somehow, the traders will just import the items from Poland etc and force the prices down. The prices on the market will always reflect simple supply and demand etc for very short periods of time thanks to gimmicks".
I then took a look at how, if this were to go ahead, we could counter the problems that raising food prices would cause: "Why not increase VAT and import taxes on food so that the prices are driven up, and people will be less likely to import foreign items. I mean we'd have to increase the import tax by a lot, and this may have some side effects on our economy. New players can always sign up to NHS handout things, we could help fund the NHS through the income from the increased VAT and import taxes. This is just an idea; we can't be sure that doing any of this will drive up food prices.". This would be a good plan as it would do exactly as I said if everything went to plan. Man Friday then asked me as to what rates I would increase VAT and import taxes to, I replied by saying that VAT to around 10% and import to around 50%. This would be a major increase and would not only drive the prices up through VAT by 9%, but would block any major imports of food by increasing import tax by 14%. This would result in a large amount of money that could be donated to the NHS to help new players with food handouts.
The proposal looked on its way when Argo delivered a bit of a death blow to my plan: "Our import rates already are prohibitive to people importing goods, the 33% on food will deter most from selling to our markets and the 8% on weapons is irrelevant as we have a domestic oversupply on pretty much every Q. this can be seen in the fact that prices are sliding down constantly meaning with the extra 8% costs few foreign sellers will dominate the market.
Import tax changes will essentially have no effect
Raising VAT will increase prices however artificially... the price increase will go to government coffers and have no change on margins so essentially all you will do is take more money from peoples pockets." Whilst I wasn't planning to fiddle with the weapons, my plan for import tax was stopped, and then Argo proved that VAT perhaps wouldn't work by saying that it would only drive the prices up artificially.
After a while, Madelina returned by pointing out that new players could sign up to NHS and eBrit, this was really good as it resurrected her original idea of driving up food prices, and my plan of VAT and possibly import tax: "Back to prices. You say that the new players would suffer - but they can join the NHS and eBrit U and we'll feed them, they won't need to buy much.
And prices were a whole lot higher when I was new, I just learned to manage my resources and stay within budget... may have taken a bit longer but at least I paid a fair price for what I bought." So the point still stands, despite Mr Knee posting a long paragraph on how prices have changed and stuff...
Debates can be fun if done correctly...
So the idea still stands, now for public debate, I hope this article wasn't intruding on Rob's congress leaks.
Please remember that I don't write articles to be nasty to anyone, and that constructive criticism is welcome.
I'll be doing the rest of the CP candidates tomorrow when the list might have sorted itself out...I'm tired, I should probably get off eRep now...
Comments
U WOT M8 ILL FKIN 1V1 SNIP REK U DONT MESS WIV DA BEST.
Yours sincerely,
Good day to you,
Good night,
Sleep tight,
Don't let me 1V1 FKIN REK U FAGIT
-dont mess
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EXPECT US
very very intresting article. altought I would skip the last words.
The idea is very well proposed and I am agree with the fundamental idea. But there is not a excactly study on the real economy and a more accurated rate of taxes. a 50% of imports should mean the end of importations so this rate it is the same as a market selling to lower prices both are extremes. I think you will improve your economy adjusting the taxes but with no so much excesses.
If the prices are too low the porcentages on taxes will not be a problem in the offert and demand prices at lower prices.
This topic in fact it is very very dificult. And also depends on gold prices and offert and demand prices also taxes.
I apologize this is not my original lenguage.
Good luck
My leaks are clearly superior.
But this was a reasonable article too 😛
niet
1) VAT
As you yourself pointed out, raising VAT would not help your margins. And raising VAT for the sake of making food more expensive doesn't make sense to me.
2) Import tax
I performed a *highly scientific* sampling of the sellers on the Market page. I found that roughly one in ten sellers were not of eUK CS. Most of the sellers in the eUK market are already eUK citizens. I think raising the import tax will not significantly change the price of food.
3) The cause of the issue
The root cause of the low prices is oversupply. I think you are not alone; many of us, myself included, have low Q food companies that are laying unused because we produce more food than we can consume and it's not worth it to bother selling. This cannot be fixed by artificially raising prices. If the admins cared, they could fix the economy module by allowing us to convert the food companies into other types of companies. (First they would have to CREATE other types of products, because all we have is food and weapons; but that's a can of worms I don't want to open today)
4) The basic premise of your article
You are making an assumption that *because* food companies are not profitable, it is therefore a good idea to change laws to make food companies more profitable. I question why that must be. Should everyone have to pay more for goods because the factory owners would like more profit? I argue that it's better universally for commodities to be cheap. I mean, why do you need to be rich, if everything on the market is abundant and cheap?
It would be more fun if we had a working economy module, of course, but I don't think any of the limited tools provided currently ingame (ie. taxes) can be used to resolve the issue.
Thanks for writing the article though, civil debate is always enjoyable.
It is that! Thanks for the feedback!
Everything is too low.