Subeta Economy 101
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So I'm noticing in the news comments about the looming removal of bank interest, that there are a lot of questions about the economy and why the removal of bank interest is going to be important for the economy. Supposedly I heard rumor of taxes being introduced? (I'll only accept this if we can battle Sebastian)
So I've tracked down an old thread, originally by the lovely and I'm simply going to copy/paste points she wrote. You can find the thread in question here: Inflation on Subeta, Explained + Tracking Total sP
If there are others who would like to contribute their knowledge and helpful examples, please do so! Further discussion and feedback regarding the upcoming changes are welcomed too. ^^
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o If you only have 1,000sp, 1sp means a lot. If you have 1mil sp, 1sp doesn't mean much. The more sp you have, the less 1sp is worth to you.
o If you are getting tons of sp from a site feature like Saggi Weekend Special Quests, so is everybody else. The more sp everybody has, the less 1sp is worth to everybody. This means 1sp has less purchasing power.
o This causes the prices of desirable items to go up. Say a certain wearable is worth 5 units of Happiness to you, and say 1sp is worth 1 unit of Happiness. You would be willing to trade 5 units of Happiness in sp, that is, 5sp, for that wearable. But oh noes, now everybody is a billionaire, and it takes 1mil sp to make up 1 unit of Happiness. You still have to trade 5 units of Happiness for that same item, but now it's 5mil sp!
o Basically, the intrinsic value of items stay the same (that is, the usefulness/desirability of item stay the same), but the value of sp goes down, so now you have to pay more sp to make up the difference. This is inflation.
o If everybody is making less sp, then 1sp will have more purchasing power, and the prices will go down.
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Note that sp generated from site features is different from sp from selling an item to another user.
o When you get sp from questing, playing Random or collecting your bank interest, that sp is new money entering the economy--it's the same as the government in real life printing more money.
o When new money is created for you, you have more sp while everybody else has the same amount of sp, so the global amount of sp increases. This leads to the inflation explained above.
o But when someone pays you sp for your item, you're just getting money already in the system. You have more sp, but someone now has less sp, so the global amount of sp remains the same.
o sp sinks are site features that take money away from the site. When you buy something from the Millionaire Center, for example, the sp is deleted. You have less sp and everybody else has the same amount of sp, so the global amount of sp is less.
Economy and Statistics Misconceptions
If a change is made to the economy, such as adding a 3% tax, will there be immediate effects or anything noticeable?
- not quite. At first, there may be some influx of sPs entering or leaving the global market, but over time, it should be a gradual trend. Watching the economy is purely statistical data, something that can be recorded and graphed over time. The goal of introducing a change (a dependent variable) is to see if there is a significant difference before and after the change was introduced.
How long will it take before the changes become noticeable?
- It depends on a lot of various factors. Typically though, time is the key factor. Also deciding how often and when to record data, and staying consistent.
It can take up to 1-3 years for results to become noticeable, and that's assuming nothing new has been added into the mix. Which, with any experiment, isn't easy. Confounds are bound to happen, so it then becomes a question of whether or not the intended variable introduced was actually responsible for the change in the statistics.
Then how can you prove a new idea works?
- simply put, ya can't. In statistics, "prove" is not allowed to be said or written because error will happen somewhere, someway, and in any design. :p
Statistics is not about proving anything really. Typically, statisticians use an alpha (α)= .05. This means that a statistician is 95% confident that what they found was truly influenced by that new variable/manipulation and not by some other factor. You'll see on TV ads about a product killing 99% of germs; this means the statisticians set their alpha very, very low, to make it appear as though they found something. And they most likely have...but if that alpha had been at .05 instead of .01, there's a chance they may not have had significant results otherwise.
Besides, saying 99% sounds a lot more confident than 95%. Who wants 5% of germs on their hands from using Product B, when you can have less than 1% by using Product A instead? xD
Why take the chance or add changes if there's a risk it won't work?
- because you'll never know until you try. :) What's nice about working with a virtual economy like Subeta's, is that it can be easily manipulated in all sorts of directions without too many severe immediate consequences. Bad ideas can be quickly reversed.
Having taken a psychology-based research and design class, our results were very much tied to how well-designed our experiments were. And if something possibly confounded our study or we didn't get the results we had predicted, then we technically didn't find what we were looking for, or the study was badly-designed and too riddled with errors for us to be confident in our results.
And that's how research is! Constantly refining what we know and solving dilemmas to make well-designed experiments work the way we hope, and finding possibly better solutions to handle old problems more efficiently. Not to cure the problem, but rather mitigate what we don't want.
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You can explain it all you want but you are never going to convince people that interest on fake money, in a fake bank account is not their god given right.
Thank you for making this! I think the most important thing to remember is that Subeta is a game, so we have to try and balance keeping things fun with also making sure that the economy doesn't run away from us.
💖 ✨ 🤗
[edit] Posts are taking a long time to show up on my end. What the heck.
I still think the removal of interest is the best move Subeta has done in years
Fight me
This has all been discussed in the "Quests Rewards Give Out FAR TOO MUCH SP" feedback thread. If you go through the last few pages (7 and up), you'll see the rest of the discussion.
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The funny thing is that if you aren't very rich, earning interest actually hurts you in the long run. IE your purchasing power drops at a faster rate than the rich.
that's why i spend sp on things that matter, like subeta health insurance aka obamacare, i mean keithcare
A lot of people are going to be "MUH QUESTS" and not read further.
The thread derailled pretty quick, I think the title and OP could be edited maybe ? ( ? or no ?) There's plenty of great ideas on it though, so it would suck for it to be locked.
It just feels off to have twice the same discussion we just had a few hours ago
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I would be okay with the other thread being a discussion for quests and stuff and stealing money from the poor.
we rich people have to show them who's boss around here. them peasants can't just go around and buy things lol
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I'll be honest, I haven't even read over that thread. Didn't realize it was already addressing the bank interest.
Could probably have this moved to General, since Potter's thread hasn't been posted on in a long time. It's a nice little educational tidbit for everyone, so when someone questions why an sPs-related thing is being changed/removed, most likely has to do with balancing the economy.
Statistics to Examine
"There is a total of 886,848,444,535 sP"
posted from back on 9/24/12
There is a total of 1,048,074,741,844 sP last post on Potter's thread, , 1/18/14
There is a total of 1,750,462,956,150 sP as of 7pm, 8/13/15
+161 billion more sPs generated between Sept 24, 2012 to Jan 18, 2014. +702 billion more sPs generated between Jan 18, 2014 to today. (all approximate values for simplicity's sake) i don't pay attention in math
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I think you have your zeros confused. This is billions, not millions.
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Corrected, thank you. |D
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Unfortunately, if people didn't read the other thread, I doubt they're going to read this thread.
I think the word "quest" scared them and they were afraid of quests becoming just bad.
All I want from quests is to remove the SP from wizard.
I think "quest" made them more likely to visit the thread to voice their opinion. no one is going to voluntarily go to economics class.
people don't really bother to read other posts anyway. we need a place that is official that people actually read. even on the siteupdates, people say the same thing for 4 pages even though 3 other people said the same thing 2 posts above them and someone else explained the reasoning behind it midway through that page.
If you want to keep the economy under control why not put price caps on restockable items. It's one thing to charge a lot for a retired or limited edition item but being able to ask 50 million for a r99 item is overkill. Everyone autoprices and we end up with a huge list of people all asking 50 million for a restockable item. Price caps could be determined by the rarity of the item. Lower rarity = lower price cap, higher rarity = higher price cap. Non restocking, retired items, and special items = no price cap.
Serious Telenine Collector at work!
I've had a thought similar to this. My idea was instead of being able to price a item to whatever you want it had a limit of how low the item could go. Like a 400 sP item in official shops it could only down to 1,400 sP. It never went below 1k above the official price. It would keep people buying in the shops first and keep people from undercutting all the time.
Granted I don't think it'd work period but yeah.
Still kind of skeptical on how this interest removal and 3% tax thing on shops is gonna work. Long as it doesn't get so out of hand that even a new player cannot make much sP and it doesn't become a neopets like economy where it's hard to make sP at all, I will be alright with it.
[kiss=blackwolf_2009] [dance=blackwolf_2009] [egg=blackwolf_2009] [TP=blackwolf_2009]
@blackwolf_2009 losing 3% of your income from shop sales will have a negligible effect to you, and likely a greater effect on richer users as they are likely making far more shop sales. It's not going to be the make or break of becoming successful on subeta, the only thing that will ever do that, is how much and how effective of time you put on subeta.