Huh? What you're talking about is literally inflation, which I'm saying didn't really exist in the way we think of it in the 1800s?
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Prices decreasing is the opposite of inflation. The industrial revolution lowered prices, even as overall profits increased. Having a fixed base price prevents that from happening and thus the true power of industrialization is crippled. Which has knock on effects for trade. Industrial powers can't export their cheaper goods to less developed nations because ultimately the price in both locations tends towards the same fixed value no matter either sides tech level.
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What you're describing is making base prices movable or not even having a base price at all, which involves a change in the CPI, which quite literally is an inflation mechanic. I don't think this really is necessary for trade because there's already a good amount of divergence in prices (and comparative advantage will increase that even more).
I think there are probably ways to implement deflationary mechanics (could be as simple as changing the price calculation to also look at the volume at base price) but with any major change like that there's going to be a lot of unintended consequences. Might as well implement the "simpler" changes first and save the finance stuff for a later rework
I think that an economics simulation of the industrial revolution that has a fixed price for goods is inherently flawed. Getting rid of the base price entirely, even if it doesn't really do anything for trade, would be a positive for accuracy alone.
Although, if a tier 3 production method generally results in a unit price of 15, but a tier 2 production method generally results in a unit price of 25, then that would definitely give the owner of the tier 3 factory a major trade advantage, especially since the tier 3 factory would be producing more goods as well. So free floating prices would allow for more exports to less industrialy advanced nations even if it didn't necessarily help peer to peer trade.
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It might be more realistic, but it would totally destroy the foundations of the simulation and would require an entire rewrite that has no guarantee of even being any better in terms of usability. Look at Vic2's economy, it's a total mess that nobody knows how to work. Base prices mean you can't represent monetary policy as well, but I honestly don't think that's as necessary as domestic economic stability in a game like this
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Im more than willing to bet that they play tested this out extensively prior to release and went with the base price formula maxing out at +/-75% because it felt the best for players to just intuitively hop in and enjoy. Free floating prices sound better in theory and might be a more accurate sim are probably difficult to balance and implement
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And im more than willing to bet, that "play tested something out extensively prior to release" never happened which we clearly saw in pre-release streams. Devs were clearly surprised seeing bugs we saw constantly in 1.0.
Anyway, we clearly see, that our main economic loop was to keep prices of goods neither too low nor expensive, and trade doesnt really fit design of Victoria 3 economy.
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But the existence of a base price doesn't necessitate the equilibrium price of good in an economy being equal to the base price. If you're playing the game right your wood price should actually stray towards negative something in the early game and steel price should stray towards positive something. Capital efficiency (profit per n construction) and labour efficiency (profit per n workers) is generally what drives equilibrium price - and if you had untethered trade alongside relatively rational agents (or at least as rational as Paradox AI can get lol), this effect would be magnified. -75% to 75% is still a large enough range to represent comparative advantage, you don't really need excessive double digit price ratios.
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Not necessarily. More advanced production methods tend to allow to increase production and sell at a lower price while staying profitable.
Maybe the effect, or the number of improvements is not enough, as lower prices lead to increase SoL and more demand. But the TV situation mentioned by @Nnorm is this and it is modeled in the game.
IMO, the main problem when it comes to trade is not that prices can’t be different enough, but that trade is very limited. First, tariffs are calculated against base price, which hangs heavier on cheap goods that have and advantage on the importing market. Secondly, the number of convoys is very limited. Thirdly, trade routes expect a minimum productivity, which limits its growth. And, last but not least, the increase of size with level is not constant. I don’t remember the scaling factor now, but this also limits trade route growth. The numbers are made up but illustrate the problem. For instance, you have a trade route that is a level 10 and trades 10k units. Changing to level 11 means it will trade 15k units, but at this number of units productivity goes below limit. It will stay above limit at 14k units trade, but it is either 10k at level 10 or 15k at level 11. So the route could trade 40% more but it won’t. Stack all those effects and you can discuss all you want about price variations or competitive advantage that if you don’t tackle this, trade will always be as limited as it is, IMO.
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This is the bottle neck of trade currently. Trade volumes should increase linearly. Goods should also have different transport costs like paradox has introduced in EU5.
Another thing is that when you ship a good from point A to B, you apparently return with empty ships to point A. This is ridiculous. When the convoys sell their cargo in the destination market, they should also buy goods to ship with them to their journey home. This logically requires automated trade. The calculations should be efficient in order not to tank performance.
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Goods do have different transport costs- there's a convoy modifier value where certain lower weight goods require less convoys.
Yes I agree- I think the way this gets represented should be on a per route per state basis where a trade route from NY to PARIS gets a decrease in opposite freight costs the higher the volume goes up. So if you have two goods with equal freight requirements and equal amounts being shipped you can get up to a maximum of -50% trade costs. This will incentivize durable trading partners and routes. This should also help with performance because you will inherently want less overall routes
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I'm quite certain that the actual culprit for trade being so unsatisfactory is the general lack of specialization the game has.
The system certainly has its woes which sould be fixed, like the lack of autonomous trade, MAPI problems, and state-only convoys, but the actual principle of selling cheap goods on an market where they are expensive, with the volume making the prices converge up to a point works quite alright.
But when prices don't have such an extreme difference from one market to the next is where the system breaks down, as it becomes hard to get trade really going as it should.
If the current specialization tools (like state traits and companies) had far more aggressive and unique bonuses, we'd be able to get goods (and importantly, only some goods) really dirt cheap and thus get a good volume for exporting.
At the same time, other countries would get other goods really cheap, which they would then export to our market.
And this could get quite complex, let's say France has a motor industry bonus, Germany a steel bonus and Britain a tooling bonus, the French might need those imports to keep their own supply chain. They'd all benefit with their heavy industries being used to their fullest.
Or some interesting synergies could arise here with manufacturing and raw resources, with Britain maybe having a bonus for textiles, while the USA has cotton bonuses. Or the Germans with steel, and the Swedish with Iron, the Russians with logging the French with furniture, etc etc.
The question we currently ask with trade is "why would I import steel when I can just build my own steel mills?", and the answer I'd like to give us is that "it just wouldn't be enough".
Say you have a motor industry throughput bonus from a company, which said company keeps building from the IP, it becomes very hard to keep up when one motor industry needs several steel mills to keep steel prices low enough, and then you have to worry about coal and iron as well, so you have to resort to imports, and look at that, Germany has some very cheap steel on the market.
But for this to work, companies really need to become very powerful, but each country only having some of them, or otherwise you can specialize in everything, missing the whole point of it.
Companies should also become very aggressive in acquiring buildings, possibly even buying from other private owners.
And, of course, it's crucial that the AI is able to use this system, which might actually be the toughest part of this whole thing...
Another factor to consider, related only to consumer goods, is how pop needs increase as the price lowers.
The fact that a good is cheaper can make a pop's SoL go up, resulting in increased consumption, which in turn doesn't let you keep prices depressed as perhaps it should, hurting exports.
I'm not sure this is as much of an issue as I feel it is, but perhaps consumption should follow a smoother line?
The system certainly has its woes which sould be fixed, like the lack of autonomous trade, MAPI problems, and state-only convoys, but the actual principle of selling cheap goods on an market where they are expensive, with the volume making the prices converge up to a point works quite alright.
But when prices don't have such an extreme difference from one market to the next is where the system breaks down, as it becomes hard to get trade really going as it should.
If the current specialization tools (like state traits and companies) had far more aggressive and unique bonuses, we'd be able to get goods (and importantly, only some goods) really dirt cheap and thus get a good volume for exporting.
At the same time, other countries would get other goods really cheap, which they would then export to our market.
And this could get quite complex, let's say France has a motor industry bonus, Germany a steel bonus and Britain a tooling bonus, the French might need those imports to keep their own supply chain. They'd all benefit with their heavy industries being used to their fullest.
Or some interesting synergies could arise here with manufacturing and raw resources, with Britain maybe having a bonus for textiles, while the USA has cotton bonuses. Or the Germans with steel, and the Swedish with Iron, the Russians with logging the French with furniture, etc etc.
The question we currently ask with trade is "why would I import steel when I can just build my own steel mills?", and the answer I'd like to give us is that "it just wouldn't be enough".
Say you have a motor industry throughput bonus from a company, which said company keeps building from the IP, it becomes very hard to keep up when one motor industry needs several steel mills to keep steel prices low enough, and then you have to worry about coal and iron as well, so you have to resort to imports, and look at that, Germany has some very cheap steel on the market.
But for this to work, companies really need to become very powerful, but each country only having some of them, or otherwise you can specialize in everything, missing the whole point of it.
Companies should also become very aggressive in acquiring buildings, possibly even buying from other private owners.
And, of course, it's crucial that the AI is able to use this system, which might actually be the toughest part of this whole thing...
Another factor to consider, related only to consumer goods, is how pop needs increase as the price lowers.
The fact that a good is cheaper can make a pop's SoL go up, resulting in increased consumption, which in turn doesn't let you keep prices depressed as perhaps it should, hurting exports.
I'm not sure this is as much of an issue as I feel it is, but perhaps consumption should follow a smoother line?
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Victoria 3 tends to steer away from national bonuses towards industries, the most we get that is actually unique to a nation is state resource traits.
While there are unique national companies the only thing really unique about them is their combination and extra productivity bonus.
In the case of the unique combination you can always find the buildings you want in other companies though sometimes requires more companies.
As for the productivity bonuses, they’re typically to small to matter.
In MP we’re talking about most major powers having 100+% throughput on coal & iron
It's a chicken-and-egg issue: trade is too costly, so you can't rely on imports for your economy, which means you make a little bit of everything, which means trade can't compete. This is the biggest issue that makes every game's economic run feel too similar.
Britain should be selling ships and clothes to every country in the world by 1900; the US should be selling cotton to every country in Europe by 1860; etc.
Taller industry improves the game in so many dimensions:
- It's more authentic: shipbuilding, steel production, and automobile manufacturing were highly concentrated in just a handful of global cities, which were super performers. Something like 70% of the world's ships came from a handful of British shipyards; something like 80% of all US steel production came from 3 states or so.
- It makes gameplay more varied: a plantation economy (eg Brazil) feels different from a breadbasket (eg Argentina) feels different from a steel producer feels different from a textile producer. Specialization makes economic gameplay feel different in each playthrough.
- Presumably, a huge improvement to performance. Having 10 level-1 buildings in a state is much worse for performance than 1 level-10 building because of pops fragmentation.
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It shouldn't just be tall industries for every single thing in one state though either.
One thing I've thought about is more throughput modifiers as a bonus for journal entry completion. There's a general sentiment that a lot of JE's don't feel fulfilling, and I think giving them throughput modifiers for completion would have the advantage of killing two birds with one stone:
a. they're permanent and potent - a 25% throughput bonus is as fulfilling as, say, a morale idea in EU4
b. they can actually be flavourful if you pick them properly
As an example, one thing you could do is a +25% throughput bonus for textile mills after completing Indian Home Rule. This is a really nice modifier that helps you in the mid to late game, and it actually makes narrative sense - you've established your rule over India, and now you're gradually integrating indigenous textile practices into the country's economy.
Yeah, we definitely shouldn't end up with a world where 90% of the US economy is coming from Pennsylvania – but we should definitely be much more likely to see every marginal level of steel invested in Pennsylvania, rather than randomly appearing in Nebraska or somewhere else, even if that crowds out employment or investment in textiles or other industries.
One level of a given industry in a given state should 1) make the AI much more likely to invest in that industry/state, and 2) make it much less likely to invest in that industry in other states. We see hints of this with the companies rework in 1.8 where it's supposed to concentrate in specific states, but that needs to get scaled up to the economy overall, which is only feasible with trade that allows smaller countries to specialize.
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I think this is the type of thing the developers have tried to steer away from pretty actively because of perceived negative viewpoints towards these types of ideas. I think there is actually room in a game like Victoria to instead of have mechanics as a foundation. So instead of a 25% throughput bonus flat at national level completing JE's get's you a special character trait for a company leader which helps you skip ahead in more granular tech while that characters alive.
But after creating those textile mills India would become the most powerful textile country in the world beyond it's climate and cotton advantages? No-one would ever be able to compete?