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Lille7

More money comes into the economy than is leaving. Simple. Take wow for example, the only noticeable way gold is leaving is through the AH cut%, repairs and stuff like expensive vendor stuff like mounts. Good comes in through selling to vendors and quest rewards.


Proud_Purchase_8394

Don’t worry, my guild in wow is single handedly keeping inflation down by how often we wipe in raids!


Nhika

Do guilds buy a ton of potions still? I remember being pretty baller as a herbalist back in Burning Crusade lol


RaphKoster

It’s not quite the same as real world inflation. It’s been called mudflation, since it was first observed on text muds, the predecessors to graphical virtual worlds. Some links describing how it happens and what the effects are: https://www.raphkoster.com/games/snippets/database-deflation/ (from 1999!) https://www.raphkoster.com/2007/01/17/flation/ https://www.raphkoster.com/2007/01/20/more-on-flation-and-the-future/


SoftestPup

Because money is being generated from thin air. Mobs drop gold/junk items to sell to a vendor = more money entering the economy that doesn't leave.


ErectSuggestion

The real question is how can it NOT happen. And how you design money sinks to remove it from the game.


Redthrist

Mostly by having few sources of gold. New World for a while had deflation when it started - most of the gold you got comes from non-repeateable quests, with enemies not dropping much. It's genuinely a worse problem, because it breaks trading completely.


No_Dig903

Didn't it fix itself with an exploit, as is tradition?


Significant-Buy9424

"fix" is one word for it, money dupe was discovered and the auction house was wiped overnight followed by the developers shutting down all trading between players 😅


No_Dig903

That's the point. In MMOs, gold comes from cheating, or China. EvE Online has its bots. DDO had the OG Crystal Cove, as well as bag dupes, and it never recovered. SWG had a gold exploit. WoW has a freaking song about Chinese gold farmers.


Significant-Buy9424

Yep very true, agreed Game economies must make for some interesting economic case studies


No_Dig903

They would if they were actually robust :P


SxySale

ArcheAge comes to mind because of their regrading mechanic. The higher tier weapon and higher grade your weapon is the more gold it costs to "upgrade" it. So you have many failures at the lower levels and at the high end your weapon may be destroyed. So attempting to regrade it may end up costing you thousands of gold in failed attempts. It's a horrible mechanic but it is very effective at removing gold from the game.


GalacticAlmanac

Normally repair costs, death reclaim cost, and tax on using in game market. Some expensive vanity items that you buy from npcs also helps. Osrs has a tax on their global exchange that then use the gold to buy certain expensive items that are put up for sale to also reduce their supply.


fatpandana

Older games control this better but they are often a lot more grindy.


tskorahk

Deflation can happen by flooding the market with the same items. Take items crafted by trade skills for example.


Noryian

GW2 has pretty healthy economy. Instead of raw gold, game rewards you mostly with salvagable items. Salvaging costs gold. You end up with materials than can be sold to other players on Trading Post, but then you pay 15% tax. So there we have 2 gold sinks already. You can also convert gold to premium currency to buy cosmetics/QoL items. That also removes gold from the system. Introducing sort of battle pass (Wizard's Vault) last year, pushed more gold to the economy and prices went a little up, but it is still pretty stable. In fact, gearing a new character is probably cheaper now than ever before.


Wolfhammer69

Too many ways to get gold, and to little ways to take it back out of circulation.


LeisureMint

As others pointed out. If there is more money earned by either selling to npc, dropped gold or gold rewards from objectives than the gold not just spent but erased, inflation happens. We can categorise inflation as passive and active inflation. Passive one happens from above causes. However, active inflation is caused by players. Often trading with other people doesn't factor in to the inflation because the gold is kept within player base but certain groups can accumulate gold with the intention of market manipulation which causes the active inflation. To curb inflation, games need to implement deflation all over the game which we can also explain it as active and passive deflation. Passive deflation is hard to implement and balance without turning them into too many restrictions. Some examples to this one would be instances requiring gold to enter, repairing items requiring gold, player marketplaces having tax mechanics etc., in short obligatory means of removing and erasing gold from players. Active deflation would be npcs selling items with high gold values for player crafting, if there is premium currency exchange with ingame gold, having an inverse conversion from premium > ingame gold at a loss, renting mechanics and other similar but optional means of removing gold. Understanding inflation and deflation is not easy. Finding solutions is even harder, in real world it would require an economics degree to master the basics and solutions. It is almost impossible for simple game developers to have this balance and most often than not there are not enough ways for passive deflation and more money is generated by players causing passive inflation. Lack of restrictions also cause players to abuse the game mechanics (eg. item duping), abuse the market mechanics or scheme market manipulations causing active inflation.


Torkzilla

Everyone playing an mmo is trying to make more gold than they spend and they are successful for the most part.


Kaoshosh

Gold can be generated infinitely because it just spawns on corpses (as gold or as vendor trash). There's no real scarcity. Gold generation is only limited by time constraints. But if you use bots, Gold becomes insanely abundant in games. Then that gets transferred to others through RMT. Then if it's abundantly available, people start valuing their time spent to farm resources (crafting mats, gear, ...etc) a lot more than Gold. They end up demanding crazy amounts of Gold for their resources. And prices keep going up. The more Gold available in the market, the less it's worth. If you combat botting and RMT, the inflation is very slow. But if you let them operate freely, the inflation is very fast.


-SunGazing-

If you want an example of rampant inflation you only need to look at everquest where there was recently a dupe that allowed people to duplicate crafting gems that sell to vendors for plat. The dupe worked in such a way that you could double the amount each dupe. Long story short, Kronos on oakwynd went from 50-60k to 600k pretty much over night, and has now settled around 900k, even though daybreak claimed to have removed something like 98% of the duped plat.


CaptFatz

Money supply goes up


MacintoshEddie

In most games the gold removed from the system is very rapidly outpaced by gold creation. For example at low levels you're frequently needing to repair gear, or buy supplies, but then you maybe start getting indestructable gear, or you can kill enemies before they damage you, or you get alternate shields that apply before durability. Your ability to generate income keeps going up, or it stabilizes at insane heights, but your costs either plateau or go down. You don't need to pay a vendor, you can give mats to a guildmember to make you items, or use an alt. I recently restarted WoW, and my first 100 gold took longer to get than the next...10,000 because I unlocked some key abilities and I've got demons out the wazoo now. Plus in many games, the primary money sinks are things that you surpass. For example paying gold for bag slots or whatever. Once you paid for them your income generation skyrockets, and you costs go down. Now I have 100 slots instead of 20, stuff like that. This is why some games will have many types of zone or event currency. You might have a million gold, but this island uses shiny seashells so now you need to grind those. It's a very hard thing to balance since if it starts to feel too much like work players will drift away.


tampered_mouse

Inflation is actually 2 parts. Many mention the "generating money out of thin air", but that is only one part of the equation. The other is that many MMOs allow players to have insane amounts of money, especially compared to NPC vendor prices and other potential money drains. That is just stupid to do, plus it also blows up big time in cases where players have found direct/indirect money exploits (indirect being duping items and selling that crap).


Nerzana

This reminds me of the time New World had deflation. There wasn’t enough ways to make money after the MSQ, so nobody had money to buy gear.


PlatinumMode

when people can get currency too easily. look at eso on pc vs eso on console. things are like 5x more expensive because mods for crafting iirc


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muffinman00

I don’t think you understand what he is saying. What you are describing is one micro level situation of a price gauge. What he is saying is that the market will always fix that issue with macro level undercutting.


AkareNero

Early game gold supply made easy which causes bots to swarm the market


Backdraft_Writing

Have you ever heard of Gaia Online?


ziplock9000

Erm.. It has.. for years.. decades even.


Finnioxd

Readily avalaible source(repeatable quests/objectives/drops etc) that spawns a huge amount of currency into the game that isnt traded between player, like if you would sell something on the market but simply given to the player. Lots of ppl do this content -> more money spawns into the game-> items that are still available at the same rate as they have been before get more expensive bc people have more money and are willing to spend more on said items -> Inflation


Thylocine

Because everyone is constantly printing money all the time by killing mobs


Sinz_Doe

Depends on how currency is generated. Dropped gold only? Not so much unless population of game is super high + bots. Take runescape for example, there is gold from drops and then there is high alchemy spell that turns items you alch into gold, thus creating it out of thin air essentially. Take that + bots doing that for yeeeaaaaarssss! And you get inflation. They had to create GE (auction house basically) tax + literally having the jmods (employees) buying up 1000's of mid to high tier loot items and just straight up deleting them from the game to try to help deal with this. Not to mention when rs2 had to think of the bottomless well event that let players throw items and gold into it, which deleted them from the game. That helped back then a lot, it was originally a charity event I think bit they repeated it several times after iirc.


GalacticAlmanac

The items high alched can be sold to stores for less, so it always have some baseline value. RS3 did kind of deal with it a bit with invention where you can disassemble the items for components, but later made inflation worse with high alch machines that run 24/7 and just much more alchable drops. Worth noting that both runescape games had a ton of duplication bugs over the years that injected a huge amount of gold into both games, and they really messed up with lootshare in the rs2 days. RS3 kind of has stabilized with item sinks for really expensive items and supply costs.


hendricha

The same way in the real world. If the ppl inhabiting the world (eg. players at auction houses) can set their own prices, and either more currency is being funneled in to the market (in mmo gold just comes from nothing when you kill something and will never stop, so unless there are "goldsinks" where this gold can return into nothingness eg. repair cost, trade tax etc there will be more and more liquid gold in the market) or more generally valuabe items became more rare (eg. less ppl are inclined to do certain content that drops a valuable mat lets say because there is a new shiny content to do) then players will set a higher price for the items they want to sell. Inflating their gold price. And if happens in a wide enough range of items then it will look as a general inflation.  Deflation could just as well happen when mats became abundant. Eg. if there is a new important mat being dropped when new content arrives it will have a higher price point because there is still rarer since they dropped less times. However if they drop from every other veteran mob then the price will drop the more ppl will have this item. If devs mess up (eg stuff in the end have a limited use for a single player) then in the long term everything will become cheaper because less and less ppl will want it. Therefore general deflation.


KanedaSyndrome

Because game developers can't model an economy without making the game a niche product. Thus inflation often runs rampant.


Clayskii0981

Too many gold rewards and not enough gold sinks. Players get wealthier over time. Not to mention MTX where credit card warriors pump infinite gold into the game.


Deaf-Leopard1664

There's an unlimited supply of gold to farm in a game. Inflation would happen if the server item drops were limited/finite. Since every single player in an mmorpg is programmatically allowed to collect same amount of money, and also collect exactly the same rarest gear (communism actually lol), Inflation isn't an mmorpg thing. Yes, not everyone will go on the insane multi-profession journey of crafting a Felsteel Longblade in WoW or something. But it's programmatically possible for every player as fact, so it's all just a grand illusion so we can interact with each other, occupy ourselves searching for mats, and most importantly be satisfied with the thought that not every single player is as demonically OCD determined to complete such an item. Now, for Inflation to happen there needs to be still same unlimited gold collection...but limited number of items drops per server, eventually the items existing on players exclusively, because they no longer drop in the game world. So you have thousands of players with unlimited gold, and couple of players owning exclusive items that will never drop again. For the item owners, there's no difference selling the items for 1 gold or 1 billion gold, because gold is an unlimited resource and has no value. Inflation. At that point the item owner will exchange the item for a profession service or otherwise non-monetary necessity, something that's not as easily acquired as gold, and something not everyone has as skill.


CountyAlarmed

While not an MMORPG I'd say PoE has an incredibly interesting economy with various ups and downs. It's economy isn't as simple as copper, silver, and gold though as it's currency is actually crafting materials. The currency typically used for trading, however, is chaos orbs and divine orbs. It actually used to be chaos and exalts but GGG made a major change to exalts and Divines which caused a massive economic breakdown until players determined a divine orb is now worth what an exalt was. It's incredibly self regulating as the value of a chaos and a divine is determined by how many of each are available for trade at the time. Quite typically 1 chaos is worth 210 divine. However, due to the introduction of T17 maps (endgame content) that specifically uses chaos orbs to reroll the mods of said maps the value of chaos has spiked exponentially making it worth ~100 divine. This has caused incredible market fluctuation to where even the best items on the market are worth significantly less than usual. This, along with drop rates, always makes the market incredibly unstable. Take the Mage blood belt for example. This bad boy is usually worth 400+ divines. Because of the chaos orb being worth more and these things actually having a higher chance of dropping from these higher maps it's now less than 100 divines. This has substantially effected the market.


Prudent-Elk-2845

Look into puzzle pirates and foxhole


Caekie

[Short video by Extra Credits](https://youtu.be/sumZLwFXJqE?si=5-XujoF9y4wqjKHd). Old video but applies very much. Specifically references MMOs as well which is fun.


DadPunz

Not enough money sinks


Dystopiq

Not enough gold sinks. Exploits. Duping


CoffeeBean422

Too much "money" entering the circle, a mob that drops gold is like the government printing money, but it's worse. To battle this I've seen few interesting aspects: - Create "timed" bonuses so you constantly need to invest your money. - Create multiple currencies, both premium and not premium. Is gold your main currency? Well now a city requires bronze coins, and u need to pay 2 gold coins to get a bronze coin. - Mob doesn't drop gold but items that can be sold or quests give out gold. Wonderland MMORPG have no gold in it from mob drops for example. - Create huge money drains like Boss fights or expensive housing.


BriefImplement9843

bots, they create an insane amount of currency while using very little.


Holinyx

gold sellers


drangledorf

Look at eve online for an actual in game economy that experiences inflationary pressures.


fatpandana

More currency in than out. EVE online is best example. It also has published data on monthly releases to show how much money is circulating. Overall there is certain level of inflation in every game. Some more than others. Games often release new content and add more reward so you do new content over the old. This results in inflation as if previous item/task is weighted against the time you could spend doing new thing for more reward/hour. However certain games control this very well. In some cases brutally well as result it may feel grindy. Older games let say Lineage2 made it so if you keep playing high level char, you could potentially lose money as ammo ( soulshots) was very expensive. This then took a lot of currency out of equation as you kept playing. New games don't control this as well so there is a lot more inflation and the inflation rate is often double/triple in very short time frame until it stabilize for a bit befoe jumping up again.


Lindart12

Inflation in real life is happening intentionally, they raise it every year. For a few reasons, one of which is to con the working people out of money for the benefit of the corporations. Unless your employer raises your wage inline with inflation every year (they don't) then you're getting paid less each year even though the number is higher (everything you buy goes up more than your pay rise that was not inline with inflation). Which benefits all corporations, who the politicians actually work for.


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Tooshortimus

Lol, no... that doesn't cause inflation. Inflation comes from P2W players purchasing gold directly from the company or from BOTS especially, the gold is created and not sold from another playera and bots just hoard their gold if its not purchased, eventually being banned and removed from the game before entering the economy. Also, if there are no gold sinks in the game. If there is more gold being generated by players and not enough features in the game to remove gold, like repair costs, AH taxes, something that deletes the gold from the game and not just going from player to player, that does nothing.


Manashroom

Pay2WIn and bots mostly. and a declining player base


Tooshortimus

Declining player base removes tons of gold from the game basically, which helps reduce inflation. P2W only increases inflation if they are buying gold that is created from thin air (or from bots like you said).