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Topics - MainDamage

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DF Suggestions / Random Dwarf Economy Thought and Ideas
« on: June 02, 2014, 08:21:05 pm »
Hello people,

I read about the Dwarven economy, which is deactivated because of a lot of problems it brings (because of technical issues).
Then I started to wonder how the economy would be when working properly, and I started to wonder about somethings I would like to see in Dwarf Fortress that go beyond the technical issues of the problematic economy.

I would like to share an idea about how the Economy of Dwarf Fortress could be. Maybe it's just some nonsense bad thinking, but give it a try.




This ideia is based on a real economy theory, called Chartalism, or Neochartalism, or Modern Money Theory.

The idea is to introduce currency to the game in a way that makes sense and does not bring inconsistencies.

Just to summarize, the whole point of the coin is to make people work for the monarch/duke/count, applying penalties to whose who don't. The monarch will usually want to improve its quartes (forcing people to make good forniture to him), supply his army (forcing people to give armor, weapons, food, etc to his soldiers), give jewels to his wife, etc.

A side effect is the improvement of the commerce, by creating a standard unit of account and storage of value.

 

It would work like this:

 1) When a high noble (Count? Duke? Monarch?) enters the Fortress, he/she then demands the common dwarfs to pay taxes. But the noble imposes a rule: the taxes can only be paid in [his] coins, and nothing else.
    The taxes can be a monthly pay of, let's say, 100 coins per adult dwarf. Maybe there can be some imposed rule that is different from that, like taxes that are proportional to the size of the dwarf's room, or proportional to the quantity of pets, I don't know. And maybe the frequency could be different (weekly taxes? anual taxes?). The details of the taxation are very important, but it is open for debate. The way the taxation is designed will affect the level of work that each dwarf will have to supply by force to the noble.

 Observation: The only one who should be able to produce (or mandate the production of) the coins is the noble. The coins should have some kind of royal stamp that is difficult to counterfeit, to make sure that the only one who can produce the coin is the noble. It doesn't really matter the material the coin is made of (gold, silver, copper, etc). What matters is that the only one who can fabricate (or mandate the fabrication of) the coins and make then legitim is the noble.

 2) There is some penalty if the dwarfs are not able to pay the taxes. Maybe prision, maybe death, maybe some other light penalty, but it has to exist. It is imposed by force by the noble. It is meant to encourage the dwarfs of not even thinking of not paying the taxes. I guess the Monarch needs a loyal guard/army to enforce these penalties.

 3a) At the start, the only way the dwarfs can get the coins is working for the noble, bringing some goods/services he wants, and exchange it for coins. That's the whole point of the coin: to make the dwarfs work for the noble. The goods could be furniture to the noble's quarters, for example.

 3b) The noble could pay his soldiers in coins, and exempt them of taxes. The other dwarfs, who are not soldiers, should give the goods/services to the soldiers to get the coins. This is a way to supply the noble's army.

 3c) If the dwarf doesn't want to work directly to the noble, he could work for another dwarf who will work to the noble and get the coins. This creates a kind of chain: there are the dwarfs who work directly for the noble, and there are the ones who sometimes works for the dwarfs who have worked for the noble.

 3d) Observe that the way the noble spends the money he creates will define where the work of the people taxed will be directed.


That's the scheme.

Observe that some dwarfs can work a lot for the noble and keep some coins saved. Those coins could be used later, to pay future taxes. In this way, the dwarf works more today, and less tomorrow.

The noble has to first create the coins, spend it by buying things from other dwarfs, and then, later, tax the dwarfs. The taxation cannot came first, or else all the dwarfs will be arrested for not paying taxes (or will suffer the imposed penalty, whatever it is).

The noble has to create more coins than it taxes in order to make it able for dwarfs to save money.

If the noble suddenly creates too much coin, it will be easier for dwarfs to negotiate and get more coins when selling goods. Things will get more expensive. That's inflation. And it's only a problem to those dwarfs who are saving money: suddenly the stored coins are less valuable.

There should be some kind of equilibrium between the quantity of coins created and spent, and the quantity of coins wanted in taxation, to make inflation always low enough, and make it possible to save money. (Unless the Monarch is very mean, but that could make the common dwarfs that are saving coins furious... Rebellion?)

Observe that, as there will be always someone who has to pay taxes in order to not be arrested, the coin will always have value. In the ideal world, the noble would try to make inflation low, to make the coin value steady. This would encourage people to use coins to store value and make commerce. The dwarfs would then start to trade things for coins, and then coins for things, and the commerce would grow.

The main thing about the theory (the one I said is called Chartalism, or Neochartalism, or Modern Money Theory) is that the taxation imposed by force is what gives value to the coin, and everything else is subsidiary to this value.

Well, this are just insights in microeconomy that would make Dwarf Fortress Economy very fun.

Thanks,

MainDamage

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