erepublik economics for dummies
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by dylan of the darkness
i have seen the need for an explanation on the economics model in erepublik because it seems to be the hardest part of erepublik to understand.
article 1; Basic inflation
to understand in-game economics and inflation one must first grasp real life real life economics and inflation. in real life inflation is the devaluation of the currency towards gold. the average person can see this in the increase in the price of goods and revises. inflation can also be seen as an indication of growth in an economy, the faster the economy is growing the more upward pressures on inflation. supply and demand also effects the inflation rate. if their is a excess of supply of goods in an economy or increased demand for goods their will be increased competition in the market decreasing the price of goods and putting downward pressure on inflation. if their is a shortage in supply of goods people will pay more for the good, increasing the price of the good and putting upward on inflation. if the price of producing the good increases the price of selling the good will increase putting upward pressure on inflation.
how does this translate into the game?
the in game inflation is worked out over 7 days so it can be very erratic. it is calculated using,
I = ((APC1 ÷ APC2) - 1) × 100
I being inflation.
APC1 being average production cost for secondary products that week.
ACP2 being average production cost for secondary products the previous week.
eg. ((105/100)-1)x100=
(1.05-1)x100=
0.05x100=+5%
to get a more accurate indication one must take the average of the the inflation over one month or 3 months.
putting less tax on raw materials will leave more money in the countries economy because secondary companies buy raw materials from with in the country. this will decrease the APC their for decreasing the inflation for that week. their for people will be willing to pay more for goods and this will increase inflation. on the other hand if the government increases tax on raw materials the ACP will increase and so will inflation for that week. it will decrease the amount of money in the economy and the amount people will be willing to pay for goods and this will decrease the inflation rate.
that is all for now, be on the look out for the next issue of erepublik economics for dummies
Dylan of darkness
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Comments
Ehhh..no.
This assumes a closed economy; easy access to the black market and to other enational markets shoots this down.
Inflation within an enation generally means:
1) someone has been printing excess money. Normally only happens after a PTO.
2) a shortage of workers has sent wages through the roof: resulting in a vicious cycle as the companies pass costs on to customers, who can afford the costs due to increased wages but then shop around for better paying jobs, sustaining the cycle.
3)tariffs or other mismanagement crippling access to resources; as the companies aren't generating true wealth, inflation indicates the true value of the enation's wealth is shrinking.
The creation of money and the creation of gold are unrelated in erepublik; the exchange rates only remain (relatively) stable due to constant international trade. For most purposes, the exchange rate can fluctuate withou harming the economy; the exchange rate has to hurt company investment before it can harm the economy.
whitelaughter LIVES!!!
G'day 'Zeke! Yeah, barely. Got my "you will DIE" email and decided to give the game another shot. 🙂
you miss the pont of " economics for dummies" it is ment to be a basic introduction for new players
i will do more in-depth articles later
look forward to them!