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Victoria 3 - Dev Diary #72 - Economic Law Changes in 1.2

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Hello and welcome to the second Victoria 3 dev diary for 2023! Today we’re going to continue talking about patch 1.2 for Victoria 3 (release date to be announced), on a topic that is closely related to last week’s dev diary, namely Economic Laws and how they have changed in 1.2. As we mentioned in Dev Diary #64, one of our post-release ambitions is to increase the differences in gameplay between different economic systems. What I mean by that is that there should be deeper mechanical differences between for example Laissez-Faire and Command Economy in terms of how they impact your country and the economic decisions you make. All of the existing Economic Laws have received changes in 1.2 and we’ve also added a new one, so I’m simply going to go through them one by one and explain how they work now.

Before I start however, I should mention a change that has happened since last week based on feedback we received on the Autonomous Investment dev diary. Several people pointed out that with a weighting system in place, there wasn’t really a need for hard restrictions on what the Investment Pool could fund under Autonomous Investment, and we agree! Thus, Autonomous Investment no longer has any restrictions on what profit-generating buildings can be built, just weighting based on who is investing and what they would want to invest in (as mentioned last week, if you’re running Agrarianism, expect a lot of farms). The restrictions still apply under Directly Controlled Investment however (and the tooltips will reflect this based on which setting you are using).

Traditionalism: Traditionalism in 1.2 is largely the same as before: A very backwards system that you should generally be trying to get out of. The main difference from 1.1 is that the Investment Pool isn’t disabled for Traditionalism, though you take a hefty penalty to investment efficiency (further reduced if you also have Serfdom) and the building types you can construct with the Investment Pool are highly curtailed if you are playing with Directly Controlled Investment.

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Interventionism: The ‘golden middle way’ of economic laws, Interventionism also isn’t extensively changed in 1.2: It provides no particular bonuses or penalties, but gives you the freedom to subsidize any and all building types as well as extensive options for the Investment Pool under Directly Controlled Investment, while providing a balanced allocation between Private and Government Construction Allocation under Autonomous Investment.

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Agrarianism: Agrarianism has received a fairly substantial boost in 1.2, with both the addition of Farmers as an investing Pop Type and a hefty bonus to the efficiency of all rural investments. Capitalists are now also not locked out of investing under Agrarianism, though they do so at a penalty and their building selection is quite limited if you’re playing with Directly Controlled Investment.

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Laissez-Faire: The invisible hand of the Free Market made manifest, Laissez-Faire in 1.2 is meant to be the go-to law for the player that wants to get the absolute most out of their Investment Pool when it comes to industrializing. It does come with some significant drawbacks though, as it is no longer possible to downsize non-government buildings under Laissez-Faire.

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Cooperative Ownership: A new Economic Law introduced in 1.2, Cooperative Ownership is now a fully fledged economic system instead of just being unlocked by becoming a Council Republic. Under Cooperative Ownership, all Pops working in a building receive an equal number of shares and Aristocrat/Capitalist jobs are eliminated. While this should lead to higher Standard of Living among the workforce, it also means far less money in the Investment Pool, as Farmers and Shopkeepers invest far less than their wealthier counterparts under other systems.

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Command Economy: Command Economy is the law that has received the largest (and most needed) overhaul under 1.2. Instead of being a frankly weird system where the Bureaucrats own the profits but you are required to subsidize them, Command Economy now makes use of a new system called Government Shares, which is used by the Government Run ownership production method. Just like how Pop Shares entitle Pops to a portion of a building’s dividends, Government Shares ensure that buildings pay some or all of their profits directly into the treasury - though in large economies this is subject to an efficiency modifier, with some of the money being wasted due to the inefficiencies inherent to large, heavily centralized systems. While this is not something we currently have a setup for in the base game, Government Shares can also freely be mixed with Pop Shares, so we’re looking forward to seeing what modders make with this!

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Another change you might have noticed when looking at the screenshots in this dev diary is that we have tied some economic laws more closely to a country’s Distribution of Power and Government Principles. For one, seizing the means of production is no longer a one-step reform into Council Republic, but rather a multi-step reform that involves first implementing a Council Republic, then Cooperative Ownership, and finally allows you to branch off into Anarchism if you so desire. Command Economy now also requires Autocracy or Oligarchy, as it’s difficult to pull off a fully centralized economy without the corresponding amount of centralized powers (and with the new Government Shares mechanic should provide more reasons to want to keep a grip on power in the late game).

So the question on everyone's mind is, when will you be able to play with these changes and all the other updates and fixes coming in 1.2? Some of these changes are pretty big and we don't want to rush this patch out too early, but at the same time we know you're anxious to get your hands on it. To find the right balance between these we've decided to launch patch 1.2 in open beta, which we will talk more about in next week's dev diary! In there we will also focus a bit more generally on patch 1.2, giving you more of a birds-eye view of what the patch will look like, along with giving you an expected release date.
 
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How do you have a command economy under an anarchy?
provided one exists.
No democracy has had a command economy outside of a total war, and none did at all during the time period. While obviously reductivist analysis is bad that doesn’t mean that anything goes, there will still always be constraints.
So make diehard democrats really really despise command economy.
Personally I think that there should be more graduated restrictions and more options. You shouldn’t be able to take an authoritarian monarchy into universal sufferage constitutional monarchy in just one step, or go back in one either.
Absolutely and completely agreed. Except for revolutions.
 
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If we are to say never concede to trasde unions, genmerally keeping the workers poor will there be some kind of over production great depression like irl? Right now in game I havent seen anything like that.
 
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So make diehard democrats really really despise command economy.
Here's the thing: a command economy would require the voters to be willing to go for it, under a system where the means of production are currently in private hands one way or another. The devs have decided essentially that that's not feasible under a system where the electorate can send non-socialist candidates to the government.
 
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Here's the thing: a command economy would require the voters to be willing to go for it, under a system where the means of production are currently in private hands one way or another. The devs have decided essentially that that's not feasible under a system where the electorate can send non-socialist candidates to the government.
I don't see what you mean.
 
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Here's the thing: a command economy would require the voters to be willing to go for it, under a system where the means of production are currently in private hands one way or another. The devs have decided essentially that that's not feasible under a system where the electorate can send non-socialist candidates to the government.
No, they've decided that a democratic council republic must enact Cooperative Ownership - i.e. worker ownership of the means of production - to be socialist, and lacks the centralization for a government-run state capitalist economy. Why are so many people treating this change as one making democratic socialism impossible? How did so many people gloss over the new economic law that is literally "the socialism economy?" The actual design change means you can't do state capitalism instead of actual worker ownership of the means of production as a democratic council republic. And yet so many people are here to either support or denounce the idea that democracy is inherently capitalist when, if anything, the game is forcing you to be more *directly* socialist if you're a democratic council republic.
 
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At the moment this is required since Cooperative Ownership is such a radical economic shift that it should require multiple legal changes to implement. I do think there is room for mixing co-ops and government ownership into the regular economic laws but we'd need to do in a way that you can't just eliminate the aristocrats by changing some PMs.
In regards to this, I don't think co-ops should necessarily eliminate aristocrats.

Denmark had and still has a very large co-op movement (Andelsbevægelsen) especially in the agricultural sector.
As Swedes, I'm sure you know something about this, since Arla is a co-op.
The way it works in Denmark, is that the amount of input you have, equates your share of the profits.
So in a dairy co-op with 100 farmers, the large local farmer, who might input 20% of the milk, also gets around 20% of the profits, but usually doesn't have more voting rights, than the guy who inputs 0.5% of the milk.
It's been similar with industrial butchering, flour mills, banks, even local health insurance before there was free state health care in Denmark.

Early on, this was a way for the farmers to become independent of the Aristocrats who owned a lot of the dairy production, Mills and so on, but if of course didn't eliminate those aristocrats.
Indeed, the largest dairy in the world at the time, was a co-op of large aristocratic milkproducers built in central Zealand in 1899. So this was a co-op meant exclusively for the aristocrats. Indeed, Edward the 7th visited it in 1904 with the Danish King, and the Royal family of Siam visited in 1934.

Later on, once the conflict shifted to being with the workers in the cities, the dynamics changed, and the aristocrats and farmers became allies against the urban workers. And today, most of the large aristocratic farming estates in Denmark, are part of Co-ops like Alra or similar companies.

My point is, aristocrats shouldn't be eliminated by co-op PMs in the sectors they are active in, namely farming and lumber. Rather, the profitmargin should increase for everyone involved, and capitalists should be eliminated.
There hasn't really been a mining industry in Denmark, so I don't know if some of the iron or steel Mills in the UK were co-ops, or how they worked.
 
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Denmark had and still has a very large co-op movement (Andelsbevægelsen) especially in the agricultural sector.
Agriculture being a coop seems to be a recurring trend. Under socialism in Hungary, we of course had planned economy, but agriculture in particular was ran as "production cooperatives" (termelőszövetkezet). They were representative democracies with multiple committes, because soviet model.
 
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Agriculture being a coop seems to be a recurring trend.
Most agricultural co-ops aren't co-ops in the same sense as factory co-ops, where the workers as a group own the whole thing. Rather, they're service cooperatives; each farmer owns their own small farm, and the co-op handles stuff that's too big for a single farmer (which can include stuff like owning the equipment, buying seed and fertilizer at bulk prices, selling the product, sometimes doing some manufacturing too, or serving as a credit union to raise funds). It's a very different calculus from a factory.

Which isn't to say that a hybrid model shouldn't be possible, of course. The Soviet Union tried it - it's just that the kolkhozy ended up being de facto state farms anyway because Stalin was not big on self management.
 
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There hasn't really been a mining industry in Denmark, so I don't know if some of the iron or steel Mills in the UK were co-ops, or how they worked.
Steelmakers in the UK in 1836-1936 were conventionally capitalist enterprises.

The steelmaking industry was nationalized in 1946, reprivatized in 1952, nationalized again in 1967 (and treated as a loss-making source of employment in Northern England and South Wales rather than as a profit-making enterprise), and finally reprivatized in 1988.
 
And yet so many people are here to either support or denounce the idea that democracy is inherently capitalist when, if anything, the game is forcing you to be more *directly* socialist if you're a democratic council republic.
I didn't say that or anything like it, so please don't put words in my mouth. I said that the devs have decided that voters under any kind of democratic system won't go for a command economy. That's it. I didn't say a thing about cooperative ownership - or even "socialism" at all.
 
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Most agricultural co-ops aren't co-ops in the same sense as factory co-ops, where the workers as a group own the whole thing. Rather, they're service cooperatives; each farmer owns their own small farm, and the co-op handles stuff that's too big for a single farmer (which can include stuff like owning the equipment, buying seed and fertilizer at bulk prices, selling the product, sometimes doing some manufacturing too, or serving as a credit union to raise funds). It's a very different calculus from a factory.

Which isn't to say that a hybrid model shouldn't be possible, of course. The Soviet Union tried it - it's just that the kolkhozy ended up being de facto state farms anyway because Stalin was not big on self management.
That's what we had. Forceful collectivisation that took all the farmland away from everyone, and merged it all into co-ops. It has a wiki article: https://en.wikipedia.org/wiki/Collectivization_in_Hungary

Small individual farms were explicitly banned, to everyone's detriment.
 
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Most agricultural co-ops aren't co-ops in the same sense as factory co-ops, where the workers as a group own the whole thing. Rather, they're service cooperatives; each farmer owns their own small farm, and the co-op handles stuff that's too big for a single farmer (which can include stuff like owning the equipment, buying seed and fertilizer at bulk prices, selling the product, sometimes doing some manufacturing too, or serving as a credit union to raise funds). It's a very different calculus from a factory.

Which isn't to say that a hybrid model shouldn't be possible, of course. The Soviet Union tried it - it's just that the kolkhozy ended up being de facto state farms anyway because Stalin was not big on self management.
This is a good point, which I didn't thi k about.

The Danish agricultural co-ops are and were, private farmers taking their own milk or pigs to a co-op Dairy or Abbatoir, where they collectively made and sold things like butter and bacon.
So the farmers often still had labourers actings paid farmworkers, and the co-op would often have employees as well.

So it might not be covered by Vic3's "Workers co-op", but it is one of the most effective co-op forms in the world.

Currently the Arla, the world's 9th largest dairy company, as well as Danish Crown, Europe's largest producer of pork and the world's largest pork exporter are both farmer co-ops.
 
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Under a democracy, what you are likely to obtain rather than a planned economy is state capitalism. I don't think there are any examples of democratic government that adopted a planned economy. I would be happy to hear if there are any examples.

This is a good point, which I didn't thi k about.

The Danish agricultural co-ops are and were, private farmers taking their own milk or pigs to a co-op Dairy or Abbatoir, where they collectively made and sold things like butter and bacon.
So the farmers often still had labourers actings paid farmworkers, and the co-op would often have employees as well.

So it might not be covered by Vic3's "Workers co-op", but it is one of the most effective co-op forms in the world.

Currently the Arla, the world's 9th largest dairy company, as well as Danish Crown, Europe's largest producer of pork and the world's largest pork exporter are both farmer co-ops.
I think that is something relatively common across Europe (especially in the agricultural sector). I don't know how common it is in other parts of the world.
 
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I welcome this changes.
I just refus that to get Planned Economy you have to get autocracy or oligarchy. Also democracies can have it if you administrate the state democratically it's not impossible to have a planned economy.

Plus: please add one party state :*
 
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I'm kind of struggling to come up with ways in which one-party states are different from oligarchies, to be honest. I won't object to their inclusion, but I'm failing to fully justify it.
Agreed. It could definitely be included but I don't really see what it would bring to the game other than adding flavor of you're playing as a communist or fascist government.
 
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I'm kind of struggling to come up with ways in which one-party states are different from oligarchies, to be honest. I won't object to their inclusion, but I'm failing to fully justify it.
From a gameplay perspective, I guess, it's that Oligarchies always support the same interest groups, whereas a one-party state could be, say, Armed Forces.
 
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From a gameplay perspective, I guess, it's that Oligarchies always support the same interest groups, whereas a one-party state could be, say, Armed Forces.
But in game terms isn't that just an autocracy?
 
From a gameplay perspective, I guess, it's that Oligarchies always support the same interest groups, whereas a one-party state could be, say, Armed Forces.
Yeah, it's kind of bizarre that in your comunist/fascist oligarchy, the aristocrats and capitalists have more political power, but I think that's a broader issue with the distribution of power laws. Vanguardists already want an autocracy, which boosts aristocrat political power... Because logic. This isn't even a difficult fix, just change autocracy from aristocrats to the head of state's IG, and oligarchy from aristocrats and capitalists to IGs in government. And the voting models shouldn't have these kinds of boosts at all, because they already have voting, and all the modifiers that come with that.
 
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Sometimes I think players have a bit of trouble distinguishing between proposals that would contribute to the gameplay and are still in the game's scope and 'what if lol that'd be cool' proposals. The latter is in the scope of mods.
 
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