[WW] Change...
Ilene Dover
It’s been awhile folks. Sorry ‘bout that, but life keeps rolling on. Resoula’s excellent idea for a writing competition has dragged me back into the media. I’m a sucker for trying to get e-rich...
This game that we all play together has changed a lot in the last month, and I wanted to talk about it. Some people hate the changes, but that’s inevitable with any change. I haven’t seen many people applauding the changes. Frankly, most people seem to be somewhere between confused and ambivalent. I hope I can shed some light on the details...
So, what’s changed? The economic module was the first big change, so let’s start there. The new distribution of resources have been done to death already, so let’s look at something new - company placement and holding companies. You can read about the factual side of things (what, how, why) here. I’ll assume you already did, or learnt by trial and error. What are the practical implications of letting citizens put their companies wherever they please?
The obvious implication is that your citizenship no longer determines your production bonuses. A Serbian citizen could set themselves up in the USA, or vice-versa. The big winners here are producers from small (or smaller) countries like Australia and Ireland. The opportunistic (and capitalistic!) residents there could and probably did establish a holding company somewhere with stronger bonuses than they have in their home country. What does that mean? It means more goods are produced by these morally upright folk, which can then be sold on their home market.
There are less obvious implications too. If small-country producers setup in a country with strong bonuses, the benefit of work tax paid through work-as-manager (WaM) mostly goes to the host country. While that’s great news for any country that earned a good set of bonuses, it’s terrible news for small countries - only 20% of the WaM work tax is remitted to the citizenship country’s treasury. This is going to be a big problem for economic minnow Israel. As you can see below, their tax revenue has dropped to about 200 CC/day. That’s not enough to pay for one MPP...
And, of course, if you want to WaM you have to be physically present at your companies. Everyone knows that nobody does any work unless the boss stands over their shoulder. Consequently the price of Q5 moving tickets has gone from about 2-25 CC to over 50 CC. Y’all know you can now move without a ticket, right?
Still on economic changes... This time looking at workers, salaries, housing and the aircraft industry. Since holding companies were implemented, an employer’s job offers are posted on the job market of every nation the employer has a holding company. What does that mean?
Since holding companies are concentrated in countries with strong national bonuses (Romania, Iran, Serbia, USA etc), there is strong competition for workers in those countries. Salaries are 175 CC/shift here in the USA (as I’m writing), and I’ve heard stories of a few offers posted at 200 CC. Contrast this with the job market in Italy and France (130 CC), the UK (under 120 CC) and Greece (160 CC).
Average salaries in countries with strong bonuses are skyrocketing. In the USA they’re about 80 CC now, compared to 45 CC a few months ago. That means your work tax paid per WaM click is increasing, because it’s calculated off the national average wage. Do your homework folks - you might find a lower average salary in a smaller country gives enough of a tax break that it offsets the reduced production.
The elephant in the room for salaries is the aircraft industry. Profits on the Q1 air-to-air weapons are staggeringly high (for three shifts [cost 525 CC] to produce 16 weapons [income 1920 CC @ 120/missile]), even at market salaries. Congress hasn’t even got around to taxing that profit! So it’s no surprise that people are building as many missile factories (and Neodymium mines) as they can afford. Since it’s only possible to produce in the aircraft industry using workers there is something of a wages breakout going on.
By popular (well, singular) request in the comments, this table shows you the rough cost price per air-to-air missile for a range of bonuses and salaries. A missile factory uses 20 ARM for each Q1 missile produced, while the Neodymium mine (don't build any others...) has a base production of 250/shift like the Granite quarry. It conveniently works out at about 2 factory shifts for each RM shift if you self-produce everything. If you want to get cute and fancy, send me a PM.
Over the past years people have invested thousands of gold into housing companies. These guys have, so far, been the losers in all of the horse trading. Why? What does that mean?
As employee wages have climbed (see above, re: the aircraft industry), previous employers are losing out. That is, they have to pay more to their workers to get the same (at best) or 8% less production (because of pollution) at worst than they did last month. The Q1 house is always a bellwether in these scenarios - their price hover around 5 to 5.5 times the current market salary. That’s because under the old economy, it took 4.5 work tickets to produce a Q1 house (if you had full bonuses). Under the new economy it takes 4.65 work tickets, and the aircraft interlopers are making each of those work tickets cost more.
Q1 house prices have responded accordingly and are about 640 CC at the moment (from 500ish before). That’s 3.65 times the current market salary of 175 CC. In other words, Q1 houses are not profitable at present. One of two things will therefore happen, in my opinion:
1. The price of Q1 houses (plus HRM and other houses) will shoot up again. Around 875 CC for a Q1 house would be about right. The big winners would be MU communes, who don’t really have any wage costs and would therefore have a licence to print money, and governments, who would collect much more revenue through VAT on houses.
2. The price of Q1 air-to-air missiles crashes to somewhere in the 35-45 CC range. This puts profit from aircraft industry companies about inline with profits from housing companies.
Only one last section on economic changes before I think you’ve all had enough. Taxes. Everyone hates them until they take a turn in the CP chair. Then they aren’t high enough!
To the best of my knowledge, no country has looked at it’s tax mix in the wake of the new economy yet. It would make sense, to me at least, to follow these general guidelines:
Larger countries with strong bonuses should concentrate on work tax. With more WaM clicks happening in their borders than ever before, work tax will stay the biggest revenue earner.
Smaller countries, with entrepreneurs that setup offshore for bonus reasons, might do well to finesse their VAT rates. If nobody other than e-patriots are running companies, revenue from sales of goods produced offshore could be a big ticket item.
I wanted to write about aircraft battles and the Maverick Pack too, but this article is already too long. Tomorrow will have to do!
Comments
Give me tables! One sheet is more useful than lots of explanation. How much one rocket could cost with full bonuses and without bonuses with salary of 130 cc per worker?
You want me to do all the work for you?!
Do it for all of us, for your friends 🙂
Fine... Done. Roughly and without ornamentation.
How can I say no to you J. 🙂
Thanks Ilene, but let me remind you that raw materials require hiring employees too. Self production is not possible.
http://prnt.sc/bvdojd
Hiring people still makes self production. It's even XP free. 🙂
Although 500/shift is just crazy...
o/
I see you stole a bit of my article style .... nice 😉
All art is imitation of what has gone before. 🙂
So much in play, and still so volatile. Interesting times.
I predict that Q1 houses will eventually level off at just under the average global salary (which as you say will likely stay higher). A lot of the Q1 housing market is after all overtime workers who will take any margin they can unless they're worried about a little xp. Higher Q housing is obviously more dependent on your big hitting soldiers (and now pilots).
Q1 missile prices are probably ridiculous, but we'll know a little more in a few hours. Even if don't turn out to be that useful in practice, or aren't superseded by Q2 etc, I would expect the price to come down with competition once more players start producing to try and get in on the action, and margins will slim down to where they usually are with other industries.
Sorry that should really read average top salary (the only ones apart from communes that actually net employees). Which has probably been somewhere around $90-$100 or a bit outside just before the new economy. Making any house below $600 previously economical for an overtime worker on the best wage. The $500 price obviously gave a margin of around $100 making it more worth it.
This could mean the Q1 price may even reach $1000 or more if wages stay where they are.
The price of a Q1 house will find equilibrium with wages. There's an optimal point where they can be profitably made. It's just in flux right now, so it pays to check your cost price against market price daily.
v
good work although wages will drop soon. After the initial influx and high prizes the markets usually stabilize and wages drop accordingly. As well most producers still have a loyal core of workers working at far below current wages. I for example have 5 workers who averaged about 3 to 4 shifts per day their down now to about 1 to 2. Anyway to continue. Houses takes 2 point something shifts Q1 houses I get 46% in some HC's. your calcs would therefore be incorrect. at my current high salary of 122 thats 122 x 10 = 1220 and i produce 2 houses per day so i break about even. although i do not care about being profitable in all sectors. i usully make enough money for 1000 wrok tickets should bumpt that to 2000 and then mass work 300 jobs. its cut throat but i only want the work tickets right?
You misunderstand my point about shift numbers. The numbers I quote are for self-supply of HRM. In the long run, this is cheaper than buying off the market because you're not paying for someone else's profit margin.
do you mean work tickets. i see a lot of people create confusion by using terms where they could just use the game terminology for example one guy referred yesterday to the war page which is the campaign page.
That's true. 4.something work tickets to make a Q1 house. All your tickets, or partly someone else's if you buy HRM instead of producing it.
Good description. Voted.
Interesting 🙂 thx Ilene 🙂
\o/
I am excited to see my wage jump 50% in a day!
You're not a team player! Shouldn't you be slaving for $1.02 in the EZC slave pit, like me? 🙂
I have found communes to always pay me less than i produce. or they require me to do a lot of work like requesting supplies daily which o forget to do.
so i work on the free market.
So much information - that I, as a self-affirmed eSlacker, do not understand. It MUST be really good! V/S/E Plus, I don't want Ilene to burn my house down again. Please don't burn my house down again! xD
If you buy my Q4 that's due to go on the market later today then sure.... 🙂
I don't find the maths underpinning the economy module to be difficult. It makes my writing on the subject hard to follow sometimes, because I don't explain myself properly. If I can improve my explanations, please let me know where!
Use PMs if you're shy of seeming ignorant. 🙂
I am certainly completely comfortable showing my ignorance AND incompetence with all matters eRep... and in general! 😃 Thank you for the offer, but I only mess with media. Politics, military and economics are not of interest to me atm.
Voted for well written and wonderful information!
Illene, great article.
Do you know why I'm not able to move to regions without bonus resources? I'm currently in CO and want to live in NJ, and it's not letting me do so.
Thanks. 🙂
I don't know why you can't move. Try checking the following:
Do you have energy?
Do you have a ticket?
Do you have at least 100 CC?
Be patient with the pop up window. Click once and wait. Click again and wait. It is possible to rush things.
Failing that, raise an admin ticket.
Yes.
Yes.
Yes.
How do I file an admin ticket?
In the bar at the bottom of the screen is a "contact" link. That's how you raise an admin ticket.
I wonder if there are enough workers, if there is enough workers it will stabilize probably, if not you could end up with Everything just keep going up for atleast a while.
I would hope the wages made it worth it for people to buy more houses, but of course the price of houses also goes up, so i don't know how that works.
House manufacturing cost depends on the wages paid. And the Q1 house purchases depend on higher salaries. There is a sweet spot where both are happy. That is,Q1 houses cost less than seven times market salary but more than five times market salary.
I am RICH ! ..... I am RIch!... I am rich ... dang what happened??? 🙁
Great job.
Great article.
v 63
Wonderful Article!