Comments on ECONOMY - CAN WE IMPROVE IT?
Day 775, 04:09
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Published in Norway 
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by
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by Evleos
I felt it prudent to comment on this article: http://www.erepublik.com/en/article/economy-can-we-improve-it--1121817/1/20
”Although, eNorway has only 790 players at this moment, there are more than 100 companies.
A short calculation reveal the fact that, in order to reach maximum productivity in all those companies, we need at least 200-300 players more. You'll say that, many of these companies don't have any activity and this is true, but let's not forget that usually, there aren't more than 300 players who are actually playing this game at least 4-5 days a week, so the shortage of workers is deeply.”
If we double the amount of players, why would not the amount of companies double? There is no reason to expect that they will all seek to be workers and nothing else. Furthermore, there is no such thing as ”shortage of workers”. If a company can’t get enough workers, it has too low wages. If this company can’t compete with the needed wages for filling all the positions in the company, it will go bankrupt -> leaving more workers pr company.
That's however not to say that increasing our population is undesirable.
“Our taxation is based especially on INCOME TAXES which are around 15% in industries that really work.
The problems here are these: Let's say 200 players are working everyday in these fields with an average wage of 35-40 NOK. That means that the collected taxes in a day are at about 5-6 NOK per player, which is also mean that in a day eNorway budget gather from income taxes 1000-1200 NOK or 12 -14 GOLD. In a month, the sum gathered is approximately 350 GOLD.”
Taxation is giving up a % of private consumption in order to support public programs. It’s simply a question of whether you want to support funding the military, alliances, hospital production etc.
” The other component of our taxation is VAT which also varies but let's say that is at around 5%.
200 players are usually buying everyday one bread and some weapons or gifts. Let's take for example q3 bread that costs at around 8 NOK and the VAT for it of 3% that mean a tax that goes to our budget of 0.24 NOK/bread and 48 NOK/200 players everyday. This way, eNorway gathers around 16 GOLD/month from bread.
If we calculate from the average wage of 35-40 NOK, the cost of daily bread, the sum that remains is at about 27-32 NOK/day for weapons and gifts that have a VAT of 5%. If a player spends everyday his earnings that means that the VAT he pays for weapons and gifts varies within the range of 1.35-1.6 NOK/day, or 40.5-48 NOK/month. For 200 players, the amount varies between 100 GOLD and 110 GOLD, that if every player pays all his earned money.”
I’m not sure what you are trying to say here, except for giving some rough revenue estimates.
”I am aware that players who are working in land support a higher INCOME TAX, that isn't quite correct considering the fact that wages are even smaller than in manufacturing and their incomes are even more discriminating, and my calculations might not be so accurate, but we definitely must do something to correct that issue.”
The relationship between VAT taxation and income taxation does in no way discriminate between land and factory production workers. Both groups are taxed equally despite the apparent lack of VAT taxation on land production.
VAT is a tax on consumption, and it is fair to assume that both groups of players consume the same goods.
”My proposal is to lower a bit income taxes, which will raise a bit wages and to raise VAT with 2 points. This way players will spend more money on products and stimulate requests for products and company owners will afford to keep their companies at maximum productivity.”
Read http://www.erepublik.com/en/article/revisited-on-the-removal-of-vat--754048/1/20 for an explanation of the current low VAT taxation. And there is no way a shifting of taxation from income tax to VAT “stimulate requests for products” and lets company owners produce at “maximum productivity”
Given that taxation between different industries are the same, taxation is simply a question of allocating a percentage of production for public programs.
”Although, eNorway has only 790 players at this moment, there are more than 100 companies.
A short calculation reveal the fact that, in order to reach maximum productivity in all those companies, we need at least 200-300 players more. You'll say that, many of these companies don't have any activity and this is true, but let's not forget that usually, there aren't more than 300 players who are actually playing this game at least 4-5 days a week, so the shortage of workers is deeply.”
If we double the amount of players, why would not the amount of companies double? There is no reason to expect that they will all seek to be workers and nothing else. Furthermore, there is no such thing as ”shortage of workers”. If a company can’t get enough workers, it has too low wages. If this company can’t compete with the needed wages for filling all the positions in the company, it will go bankrupt -> leaving more workers pr company.
That's however not to say that increasing our population is undesirable.
“Our taxation is based especially on INCOME TAXES which are around 15% in industries that really work.
The problems here are these: Let's say 200 players are working everyday in these fields with an average wage of 35-40 NOK. That means that the collected taxes in a day are at about 5-6 NOK per player, which is also mean that in a day eNorway budget gather from income taxes 1000-1200 NOK or 12 -14 GOLD. In a month, the sum gathered is approximately 350 GOLD.”
Taxation is giving up a % of private consumption in order to support public programs. It’s simply a question of whether you want to support funding the military, alliances, hospital production etc.
” The other component of our taxation is VAT which also varies but let's say that is at around 5%.
200 players are usually buying everyday one bread and some weapons or gifts. Let's take for example q3 bread that costs at around 8 NOK and the VAT for it of 3% that mean a tax that goes to our budget of 0.24 NOK/bread and 48 NOK/200 players everyday. This way, eNorway gathers around 16 GOLD/month from bread.
If we calculate from the average wage of 35-40 NOK, the cost of daily bread, the sum that remains is at about 27-32 NOK/day for weapons and gifts that have a VAT of 5%. If a player spends everyday his earnings that means that the VAT he pays for weapons and gifts varies within the range of 1.35-1.6 NOK/day, or 40.5-48 NOK/month. For 200 players, the amount varies between 100 GOLD and 110 GOLD, that if every player pays all his earned money.”
I’m not sure what you are trying to say here, except for giving some rough revenue estimates.
”I am aware that players who are working in land support a higher INCOME TAX, that isn't quite correct considering the fact that wages are even smaller than in manufacturing and their incomes are even more discriminating, and my calculations might not be so accurate, but we definitely must do something to correct that issue.”
The relationship between VAT taxation and income taxation does in no way discriminate between land and factory production workers. Both groups are taxed equally despite the apparent lack of VAT taxation on land production.
VAT is a tax on consumption, and it is fair to assume that both groups of players consume the same goods.
”My proposal is to lower a bit income taxes, which will raise a bit wages and to raise VAT with 2 points. This way players will spend more money on products and stimulate requests for products and company owners will afford to keep their companies at maximum productivity.”
Read http://www.erepublik.com/en/article/revisited-on-the-removal-of-vat--754048/1/20 for an explanation of the current low VAT taxation. And there is no way a shifting of taxation from income tax to VAT “stimulate
Given that taxation between different industries are the same, taxation is simply a question of allocating a percentage of production for public programs.
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Hmm, I totally agreed with Crocky and now I totally agree with you. 😮
Scary, is it not? Beware of the power that the Word beholds !
good stuff
I agree with your opinion and all you've just said here is true. Any company must face natural selection but if many of it are failing we might chase away people with strong desires of business. Our main goal should be safely increase of population and for that we should make a long term program and stick with it!
That's a good goal 🙂