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Victoria 3 - Dev Diary #11 - Employment and Qualifications

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Happy Thursday and welcome to another deep-dive into the guts of Victoria 3’s economic machinery. This week we will be talking about Pop Professions, specifically how and why Pops change Profession. While this is an automatic process, the mechanics of it is still crucial knowledge to keep in the back of your head when building your society. Perhaps you want to ensure the population in one of your states are able to take on Machinist jobs before embarking on a rapid industrialization project there, or perhaps you want to ensure you don’t accidentally enable too much social mobility in a country already prone to uprisings against their true and lawful King.

First, a quick recap. In the Pops dev diary we learned that all Pops have a Profession, which determines their social strata and influences a number of things like wages, political strength, and Interest Group affiliations. In the Buildings dev diary we learned that buildings need Pops of specific Professions to work there in order for them to produce their intended effects on the economy and society. Finally, in the Production Methods dev diary we learned that different Production Methods change the number of Profession positions available in a building. So how do Pops get assigned to these spots?

Our approach here differs a bit from previous games. Victoria 1 and 2 has the concept of a “Pop Type”, a fundamental property of Pops in those games that defines most aspects of their existence - what function they perform in society, what goods they need to survive vs. what goods they desire, what ideologies they espouse, etcetera. Pops in Victoria 2 autonomously change into other types over time depending on their finances and the various needs and aspects of the country. Providing access to luxury goods in your country permits Pops to promote more easily. Generally speaking, higher-tier Pops will provide better bonuses for your country as different Pop Types perform different functions. By manufacturing or importing special goods and educating your population you would turn your simple, backwards Pops into advanced, progressive types in ideal ratios, which maximizes these bonuses to increase your competitive advantage.

Pop Types from Victoria 2: Aristocrats, Artisans, Bureaucrats, Capitalists, Clergymen, Clerks, Craftsmen, Farmers, Laborers, Officers, Slaves, and Soldiers.
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Victoria 3 Pops instead have Professions. These are in some ways similar to “Pop Type”, but the ideal ratios and economic functions of those Professions differ based on the building they’re employed in and the Production Methods activated. The fundamental difference between these two approaches become clear when considering the Bureaucrat Pop Type/Profession in Victoria 2 and 3. In both games, Bureaucrats increase a country’s administrative ability. But in Victoria 2 Pops promote into Bureaucrats independently in relation to the amount of administrative spending the player sets, while in Victoria 3 Pops will only become Bureaucrats if there are available Bureaucrat jobs in Government buildings, usually as a result of the player actively expanding Government Administrations.

Professions in Victoria 3: Academics, Aristocrats, Bureaucrats, Capitalists, Clergymen (temporary icon; will be changed to be more universally applicable), Clerks, Engineers, Farmers, Laborers, Machinists, Officers, Peasants, Servicemen, Shopkeepers, and Slaves.
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The latter approach gives the player more control over where these job opportunities are created, and combined with Production Methods cause demographic shifts to have stronger, more localized effects that are easier to predict and understand. It’s also more flexible, permitting the same Profession to cause different effects in different Buildings given different Production Methods. So in Victoria 3 higher-paid Pops don’t by their very nature perform a more valuable societal function than lower-paid Pops - rather, each acts as a crucial part of a Production Method’s ‘recipe’. Each of these roles require the others to be effective - without enough Laborers to shovel coal the engines the Machinists maintain stay dormant, and without seamstresses to work the sewing machines the Shopkeepers don’t have any clothes to sell.

Buildings adjust their wages over time in order to achieve full employment with minimal wage costs. As employment increases, so does the Throughput - the degree by which the building consumes input goods and produces output goods. By the laws of supply and demand, this makes a building less profitable per capita the closer to full employment it gets, so at first blush it might appear irrational for a building to pay more wages just to reduce their margins. But since a “building” does not represent a single factory but rather a whole industrial sector across a large area, and we assume the individual businesses in that sector compete with each other rather than engage in cartel behavior to extort consumers, this adjustment of wages to maximize employment makes sense. However, buildings won’t increase wages due to labor competition if this would cause them to go into deficit, so there’s little point to expanding industries beyond the point where they’re profitable.

Employees are hired into available jobs from the pool of Pops that already exist in the state, but unless they’re unemployed these Pops will already have a job somewhere doing something else. Pops can be hired under two conditions: first, they must be offered a measurably higher wage than the wage they’re currently getting from their current employment. Second, unless they already work as the required Profession in another building, they must also meet the Qualifications of that Profession to change into it.

These Steel Mills don’t pay as well as the Arms Industries, but they do seem to offer better terms than the Textile Mills and resource industries in the same state - with the notable exception of Fishing Wharves, who also need Machinists to service their trawlers.
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Wages are set by individual buildings in response to market conditions. A building that is losing money will decrease wages until it’s back in the black. A building that has open jobs it can’t seem to fill will raise wages until it either fills the necessary positions or runs out of excess profits. As a result, different buildings in the same state will compete for the available workforce. What this means in practice is that a large population with the necessary Qualifications to perform all the jobs being created in the state will keep wages depressed and profits high. Only when industries are large or advanced enough that they need to compete with each other for a limited pool of qualified workers are wages forced to rise. This rise in wages also comes with increased consumption, which increases demand for goods and services that some of the same buildings may profit from in the end.

A Pop’s Qualifications measure how many of its workforce qualify for certain Professions, and updates monthly depending on how well their current properties match up to the expectations of the Profession in question. For example, at least a basic education level is required to become a Machinist while a much higher one is required to become an Engineer. Conversely, the ability to become an Aristocrat is less about education and more about social class and wealth. Buildings won’t hire Pops who don’t meet the Qualifications for the Profession in question.

These 981 Machinists qualify to become Engineers at a rate of 4.08 per month. Their Literacy is nothing to write home about but they at least meet the cut-off of 20%, aren’t starving to death, and benefit substantially from already working in an adjacent field. All factors and numbers are work-in-progress.
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If some Paper Mills required more Engineers and this Pop was being considered, only the amount of qualified Engineers they’ve accumulated so far could be hired. Currently that is only 85 (not shown). If those 85 were all hired, this Pop would then end up with only 896 members left in the workforce of which 0 now qualify to become Engineers. Since all recently hired Engineers used to be Machinists, all 85 retain their Machinist Qualifications. Furthermore, if 512 members of this Pop qualified to be Farmers before the hire (52%), of the 85 of them who were newly promoted to Engineers, 44 of these new Engineers are also qualified to become Farmers.

To be considered for a “job” as Aristocrat a Pop must have at least moderate Wealth, and the more Wealth they have the faster they will develop this potential. Unlike many other jobs Literacy is not a requirement for being accepted into the aristocracy, but an education does make it easier. Bureaucrats and Officers have an easier time becoming Aristocrats than other members of society, while Pops who suffer discrimination on account of their culture have a much harder time. Finally, if a Pop does not meet the minimum Wealth requirement, they actually devolve any prior potential for becoming Aristocrats. This means that down-and-out former nobles robbed of their land and forced to go unemployed or (perish the thought) become a wage laborer will - over time - lose their ability to return to their former social class. All factors and numbers are work-in-progress.
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Like all Pop attributes, Qualifications follow the Pops as they split, merge, move between buildings, migrate, and die. If you had previously developed a lot of potential Bureaucrats in your country but ran into budgetary problems and had to shut down your schools, over time those Pops who have already developed the Qualifications to become Bureaucrats will die off and not be replaced by newly educated ones. If your Capitalists in a given state had been underpaying their local discriminated employees to the degree that nobody gained the Qualifications to take over for them, and then some of those Capitalists move away to operate a newly opened Iron Mine in the next state over, rather than promoting some of the local discriminated Laborers to the newly opened jobs they will simply leave the spots open (and the mines underproducing) until some qualified Capitalists move in from elsewhere to take over.

Qualifications are entirely moddable by simply providing the computational factors that should go into determining how the value develops each month. If you want to make a mod to split up the Clergymen Profession into individual variants for each Religion in the game, you could make the Imam Profession dependent on the Pop being Sunni or Shi’ite. If you wanted Aristocrat Qualification development to be highly dependent on the amount of unproductive Arable Land in the state the Pop lives in, you could do that. An event option or Decision that makes it faster and easier to educate Engineers but harder to educate Officers for the next 10 years? Absolutely.

A breakdown of all Pops in Lower Egypt that qualify to become Engineers. Of course, any openings will be offered to existing Engineers first, and not all of the remaining qualified Pops would actually be interested in the job - though if it was lucrative enough, perhaps some Aristocrats on a failing Subsistence Farm would consider a career change.
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The intent of Qualifications is to signal to a player what capacity for employment they have available among any subset of their population. They cannot, for example, conquer a state filled with under-educated people they also legally discriminate against and expect to immediately build up a cutting-edge manufacturing- and trade center there. These efforts will be throttled by their inability to employ the locals into highly qualified positions, meaning they have to wait for members of their already qualified workforce to migrate there from the old country to take on any high-status positions created for them. But by building out their education system, paying Bureaucracy to extend their administrative reach to the new state through incorporation, and changing their Laws to extend citizenship to these new residents, they can start to build this capacity also in the locals.

In summary, Qualifications is the mechanism by which access to education and your stance on discrimination - in addition to many other factors - impact your ability to expand different parts of your society. It is also the mechanism that sorts Pops logically into the economic (and thereby political) niches you carve out as you expand, ensuring your laws and economic conditions inform the social mobility of Pops based on who they are. It’s quite subtle, and you might not even notice it’s there - until you run into the challenges caused by rapid industrialization, mass migration, conquests, colonization, and other drastic population shifts.

That is all for this week! Next Thursday we will finally get into how all this economic activity translates into revenue streams for you, when Martin presents the mechanics governing the Treasury and national debt.
 
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.... Qualifications is best thought of as a mishmash of "could this Pop literally carry out this particular Profession, given their current attributes" and "would other Pops in the country actually hire this Pop for this Profession, given their current attributes". The first part of that equation doesn't really change under Command Economy or cooperative forms of economic organization - you absolutely need a certain level of education to become an Academic or Engineer, and the greater the number of people who know how to read and write the greater the chance one of them will have the talents and tendencies to perform those jobs well. As for the second part... I'm not sure it'd make a difference, either! People tend to be, well, people, regardless of economic system, and people have biases about who they think would be a credible farmboy or clerk or military officer. So it's entirely possible Laws like those will end up making a difference to Qualification calculations before Victoria 3 is released, these numbers and factors aren't final, but even if so it probably won't make a huge impact.

What does change the equations quite a bit is more egalitarian access to the factors that produce Qualifications. In a liberal and non-discriminatory society, with a public school system and low wealth disparity, Pops will accumulate Qualifications a lot more equally on account of having more similar properties than in a discriminatory and stratified society.
Have to disagree here.
In RSFR/USSR discrimination of "former people" and people of "wrong" "class origin" was mandated legally between 1918 and 1936 and existed in reality much longer.
Between 1924 and 1936 nobles, former officers, former Imperial bureaucrats, former clergy as well as their descendants (even those born after revolution) were legally banned from most leadership/executive positions, commanding positions in military, had no right to elect or to be elected etc., etc.
(the fact during the Empire a son of a peasant could become a general, but in USSR a son of Imperial general could not tells a lot about equality under communist regime). In various forms and questionnaires questions about "class origin" remained until 1960s.

In all totalitarian regimes being noticed as (even potentially) disloyal was cause for limits on employment.
In real life and in modern times loyalty checks are still with us (google "security vetting") as well as bans on professions (google Lustration in post-communist countries or Berufsverbot or Radikalenerlass.

If you want XIX century examples, here they are: Iroclad Oath in USA, conditional pardons for Confederate commanders and politicians in USA, Anti-Jesuits laws in Germany, anti-atheist laws in many countries, Pale of Settlement in Russia, persecution of Christians in Ottoman Empire.

Thus I believe that a discrimination in promotion/acquisition of professions of POPs who have or had professions or religious characteristics that are considered disloyal by the current regime should be represented in game, that puts such great emphasis on evolution of social relations. Especially in regimes that resulted from a revolution.

TL/DR: there was and there is RL discrimination and ban on professions for anyone considered disloyal by the government. Especially in totalitarian states. IMO this should be represented in VIC3.
 
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Peasants. Victoria 3's definition of a Slave is a person who is wholly owned by another person and can be bought and sold as property. This excludes serfs, most indentured servants, etc who are instead represented as the Profession they're carrying out.
What kind of work can be performed by slaves in VIC3?
 
For example, Japanese samurai, Chinese eight banners and tenant farmers. At that time, there were special corvees and eunuchs in China. There may be no machinists in non industrialized countries.

Why can´t you represent Samurai as bureaucrats, officers and aristocrats, and eunuchs asbureaucrats? And the corvees as peasants under special laws?
 
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Can you give me some examples of important "Eastern" professions which can´t be represented via this system?
Nomad animal-herders. Not tied to a specific region (which ATM VIC3 cannot represent AFAIK). Very much existed in Central Asia and in polar regions of Eurasia and America at the time.
 
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Nomad animal-herders. Not tied to a specific region (which ATM VIC3 cannot represent AFAIK). Very much existed in Central Asia and in polar regions of Eurasia and America at the time.

And that is something which is really unrepressented. But less an "Eastern" thing and more a general thing from some peripheric regions.

I was more against the samurai and eunuch thing, which can be repressented as just other pops with specific laws
 
... productive buildings have a buffer called a Cash Reserve into which it will deposit any excess profits in fair weather and use as a buffer to avoid drastic crashes when the wind goes the other way. Buildings with an empty Cash Reserve will act much more drastically than ones with a full reserve, but all buildings that lose money will take some cautious steps to try to fix the problem before they lose too much. This means we get both some inertia where the economy doesn't go belly-up overnight because some Machinists decided to relocate, and the cause and effect of seeing buildings start to lose money, wages starting to lower, and Pops starting to change careers.
1. How big will this cash reserve be?
2. Will its size be static or dynamic?
3. If dynamic will it change with:
3.1. Change in price of product produced by the building
3.2. Change in size of building
3.3. Change of profitability rate of building
3.4. Change of average wages in a country
4. Will this reserve disappear in command economy?
 
A very interesting DD, and it continues to show how thoughtfully this game is being put together.

I do have a concern about the place of aristocrats in the scheme, however. So far, we have seen nothing to suggest how much "drag" aristocrats as a group exerted on social and economic evolution in the 19th century. Yes, I know that some aristocrats became investors in new industries, especially after the repeal of corn laws deprived them of their advantageous position in food production. (This was true not just in the UK) But the idea that a more impoverished aristocrat would migrate over to a new "job" as a machinist, which was broached above, sounds pretty strange to me. And in general I think aristocrats as presented in the game so far are in danger of becoming reduced to yet another slightly wealthier group of rational, liberal-democratic actors in some economist's wet dream of what a modern society looks like. That would deprive them of their ability to generate as much conflict as they did in the period.

I might point out too that the model being presented here more generally fails to take account of the social status accorded to some professions over others. One of the blind spots in Adam Smith's Wealth of Nations is that Smith failed to take account of status in his description of how labor flows to where the best wages are. That also seems to be the case here. Now, it may turn out that status can't be adequately incorporated in the game at release. But it's wortrh at least thinking some about the consequences of not doing so.
 
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In RL most socialist economies subsidize full or almost full employment even if a given factory is unprofitable.
Will this be simulated in game? Can you spend your national treasury on this?

(to be honest, I don't believe that VIC3 as it is now can convincingly simulate a socialist economy, because it will require a whole new economic system to be programmed in, with such key distinctions as totally fiat money, non-convertible money, total ban on conversion of bank deposits into cash for enterprises).
 
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1. How big will this cash reserve be?
2. Will its size be static or dynamic?
3. If dynamic will it change with:
3.1. Change in price of product produced by the building
3.2. Change in size of building
3.3. Change of profitability rate of building
3.4. Change of average wages in a country
4. Will this reserve disappear in command economy?
The size is static by building type but depends on the building level, so a level 3 Textile Mill has 3x the size Cash Reserve of a level 1 Textile Mill. It does not disappear under command economies, no.
 
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In RL most socialist economies subsidize full or almost full employment even if a given factory is unprofitable.
Will this be simulated in game? Can you spend your national treasury on this?

(to be honest, I don't believe that VIC3 as it is now can convincingly simulate a socialist economy, because it will require a whole new economic system to be programmed in, with such key distinctions as totally fiat money, non-convertible money, total ban on conversion of bank deposits into cash for enterprises).
We'll talk more about this later but in short this is simulated via the way subsidy mechanics works in a Command Economy.
You're correct that some of the fundamental distinctions between capitalist and communist systems of organizing the economy cannot be captured with our market mechanics, since it's completely driven by supply and demand affecting goods prices in ways that doesn't make a clear distinction between "sales price" and "value" .
 
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If a potentially qualified pop promotes to a profession requiring a higher literacy or wealth, does this lower the literacy rate of the pop they originated from?
Yes! The literacy rate shown is actually a computation, the value stored in the Pop is how many of its members are literate. These literate members are transferred in greater quantities if the Pop is hired into a job that requires greater Literacy, so it will in effect drain the source Pop's literacy rate.
 
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Why can´t you represent Samurai as bureaucrats, officers and aristocrats, and eunuchs asbureaucrats?
If I cared, I would say that the eunuchs associated with the Chinese imperial court would ideally be treated as distinct from the intact men with imperial examination certificates who made up the bulk of the bureaucracy-at-large.

(I don't care, but that's what I'd say if I did.)
 
So if I understand this correctly, let's have a look at this example:

There are two job opportunities in a state, both competing for the same workers. Let's say, they each want 100 and there are 100 in total in the state. One is slightly more profitable than the other. Over time, if nothing else changes, we will see an equilibrium in which the more profitable workplace ("1") is filled to 100% (taking in all available workers) and the other ("2") has 0?

Now what happened is that 1 increased its wages to compete against 2 and because 1 is more profitable, it could do so longer than 2, winning the race. However, 1 still diminished its profitability because of the high wages. My question is: Will the now empty 2 keep pushing up wages for 1, until it is demolished?

Or do I have an error in my example and, e.g. the split between 1 and 2 is more continuous, like 80%/20%, depending on the profitability-advantage, because it is reduced when having higher employment rate?

And in any case, we effectively see a distribution of wealth to the limiting factor of production (in this case: labor)? If there were more wokers than jobs, we'd see the profiuts go to the jop opportunity owners? If so, are the owners' wages paid before the job opportunity balance is made or will they effectively work for free to fill their jobs (given that "being in black" is the hard cut-off)?
There's a limit to how many Pops can be hired by a building each week. In week 1, workplace 1 will gain hiring precedence and will recruit the "best" workers until it's reached its limit. If there are more qualifying workers after that, workplace 2 will recruit them, up to their limit. If the building manages to hire it won't increase wages. Now, in week 2, workplace 1 has now increased their throughput and their net profit as a result has decreased somewhat, and it won't try to increase wages since it's been successful in recruiting new workers. This makes it comparatively less desirable than workplace 2, which might have increased its wages and as such might get precedence over 1 this time around.

Over time, the most productive / profitable building will be able to hire more workers than the less productive building, but they'll both get opportunities to increase their throughput and for as long as they have profit to spare and job opportunities to fill they will continue to compete on wages to steal workers from each other.

As for owner wages, they're distinct from dividends - these are the excess profits paid out to shareholders (=owners) after Cash Reserve deposits have been made. So owners take their "fixed" share of the wages alongside everyone else in the building, but then get paid a weekly bonus depending on how well the building is doing.
 
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There's a limit to how many Pops can be hired by a building each week. In week 1, workplace 1 will gain hiring precedence and will recruit the "best" workers until it's reached its limit. If there are more qualifying workers after that, workplace 2 will recruit them, up to their limit. If the building manages to hire it won't increase wages. Now, in week 2, workplace 1 has now increased their throughput and their net profit as a result has decreased somewhat, and it won't try to increase wages since it's been successful in recruiting new workers. This makes it comparatively less desirable than workplace 2, which might have increased its wages and as such might get precedence over 1 this time around.

Over time, the most productive / profitable building will be able to hire more workers than the less productive building, but they'll both get opportunities to increase their throughput and for as long as they have profit to spare and job opportunities to fill they will continue to compete on wages to steal workers from each other.

As for owner wages, they're distinct from dividends - these are the excess profits paid out to shareholders (=owners) after Cash Reserve deposits have been made. So owners take their "fixed" share of the wages alongside everyone else in the building, but then get paid a weekly bonus depending on how well the building is doing.

Can Laws change how Qualifications are generated? For example, can we have the law Hereditary Bureacracy giving penalties to becoming Bureaucrats to all pops except for Officers and Aristocrats, representing nobles moving between posts but lesser classes being unable (or having a very hard time) to access?
 
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Probably out of scope of this dev diary, but how does this interact with pops out of State? If there's a labour shortage will it start pulling in qualified personnel from different states? If there's a labour surplus, will it start pushing the unemployed to other states?
At the moment there is no explicit "there are job opportunities over there, time to move" mechanic, since that would require us to assess the wage paid for each of those job opportunities compared to the current wage the Pop is being offered to not get weird effects. Essentially to model it perfectly would be to assess each opportunity for each Pop across a whole market which would be much too CPU heavy and arguably quite unrealistic given that there are huge economic and social barriers to packing up and moving even to an adjacent state in the same country.

However, the Standard of Living (which we'll learn more about in a couple of weeks) of Pops in a state does affect its migration attraction. Indirectly this means that if a state has a good amount of labor competition and therefore relatively high wages, and reasonable access to consumer goods and government amenities that affect that measure, it will be a better state to move to. In addition, unemployed Pops are more likely than employed Pops to take the risk of moving to another state in search of greener pastures. This does create the effect you're describing, it just takes a longer route to get there.
 
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Nomad animal-herders. Not tied to a specific region (which ATM VIC3 cannot represent AFAIK). Very much existed in Central Asia and in polar regions of Eurasia and America at the time.
In essence doesn't this count as subsistence farmers? Pretty useless to you as they're not producing much more than they're consuming for themselves?
 
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Thanks a lot for an extensive diary and amazing involvement with the comments. I have two questions:
1. Are there any prerequisites for developing qualifications in terms of jobs available? Does a pop develop qualifications only when there are jobs vacant? Or does it develop qualifications when a building is available even if it’s not hiring? Would building under construction count? Can I build a factory in a state and already find a pool of available qualified workforce, or will it just start the qualification process?
Or is it so that every pop tries to get any qualifications it can independently of buildings? Can it lead to China having lots of engineers before they have any factories?
2. The second questions is related to first one. Do buildings attempt to lower wages even if not loss-making? For example, if a new factory was opened in a constrained labor market and it had to keep wages high to reach full employment, but than more workers became available through education or migration, will the building try to suppress the wages even if it is still profitable?
 
Peasants. Victoria 3's definition of a Slave is a person who is wholly owned by another person and can be bought and sold as property. This excludes serfs, most indentured servants, etc who are instead represented as the Profession they're carrying out.
I would say Russian serfs fulfill that description. They were owned, bought and sold as property without links to the land. It is hard to judge without knowing more about slavery mechanics, but overall serfdom societal impact in Russia is comparable with slavery in the US, including all the tensions arising from emancipation and land redistribution. Also, I hope you take a more holistic view on slavery. In Vic2 it was only in the Americas, while in fact at game start date it was present in most Asia and Africa (with a notable exception of China).
 
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I would bet that paradox will simplify the ACW in a conflict just about the slavery. They are actively removing tariffs, their impact and the pops (artisans) which historically saw the tariffs as an important issue.

Mercantilism is now a policy/law which brings some bonus, but zero interaction with the pops. the player can't adjust the tariffs because the mechanic has been removed, not even reworked.

Interest groups are not a satisfactory option. they have no sense in this context. there is only ONE issue which is freetrade/protectionism. these kinds of pops must not care about religion, or the monarchy. And now we will have a lot of shopkeepers pro free-trade and zero protectionist artisans. it kinda makes sense now that the slider is just a plain % bonus.

I would like to be wrong, but the design decision seems pretty clear about the removal of tariffs as a mechanic and their impact in the local industrialisation.

As I said before, this war is now impossible to model with the new restrictions. https://es.wikipedia.org/wiki/Guerra_civil_colombiana_de_1854
First, the Civil War was not really about tariffs. Yes, the debate over tariffs reflected the economic differences between North and South, but they had ended as a source of secessionist tensions way back in the 1830s, when the Tariff of Abominations was repealed. Tariffs then fell to low levels (for the United States in the 19th century). In fact, the Civil War CAUSED tariffs to increase, as the Republicans could get the Morrill Tariff through the Senate precisely because Southern senators had left.

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If you go read the seceding statements and new constitutions written by the Southern states, they don’t talk about tariffs. They talk about slavery, because that was the reason the South seceded.

Second, we don’t know that tariffs have been cut from the game. I assume we will find out about them in Dev Diaries about trade. I would be pretty shocked if they were not present in any form.
 
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