I have noticed this too, while looking at buy (maybe sell) screen and thought it happened to everything? The price changed just before i bought/sold something.

Its been a LONG time since i did any baisc economics, but if demand is high, the production increses and the (supply) price drops. This is the way things work in the manufacturing/product design industry: you make more, it costs less (generally).

I should ask my economist mate...

I'll try to synthesise all the points here.
Supply goes up, price goes down.
Supply goes down, price goes up.
Demand goes up, price goes up.
Demand goes down, price goes down.

Buying widgets has its own supply/demand system. The supply is unlimited and constant, therefore, price does not change. The demand therefore has no effect on this system.
Selling widgets has a seperate supply/demand system. Supply is the amount of goods sold in a station. Demand is the fixed consumption rate of widgets by a station. So in this case, demand is constant, so the economy is fully supply based. Supply grows faster than demand consumes, so we get a surplus. Surplus = increase in supply = decrease in price. As a result, prices decrease on one side of the economy while the other side of the economy remains constant. The scales don't balance.


There, was that a cogent a summary of the problem here?

It kind of makes sense that the buy price in a sector in which the widgets are manufactured never changes. A manufacturer has direct control over the number of widgets he produces, so he could theoretically adjust this so that the buy price of the widgets in that sector never changed. However, the buy price of a widget in a sector where it was not manufactured implies that the widget is being resold, and therefore is subject to the laws of supply and demand.

Ok, here's how things are supposed to work in Supply Side Economics (which is what we're talking about here).

/me has shivers at the memories of macroeconomics.

Basically you can think of supply, demand, and pricing this way.

Take a graph. Have two lines on it. The first line represents supply. It starts at max price and reduces down to 0. (IE downward sloping line.)

Second line represents demand. It starts at 0 price and goes up to max price. (IE upward sloping line).

The Y axis == price, X axis == units. Where the two lines meet is equilbrium which is where theoritically we want things to reach.

SOOOO.. how does this all work? Well, the supply line says at a supply of A quantity units, your buy price is B. The demand price says a supply of C quantity units, your sell price is D. IDEALLY, you want A, B, C, and D to equal each other.

Ok, enough with the macro econ lesson. :) If this is confusing, I can create a pic showing how this works.

It would be nice to see an economy like the one in Merchant Empires (http://www.advancedpowers.com/index.php). That economy rocks. ME is open source so you can take a look at the way it works. http://sourceforge.net/projects/openme

Magus, I wholeheartedly agree. This infinite-supply thing is supposed to be easier to tune as it isn't complex at all, but it wasn't my idea. A supply/demand system where stations actually produce and consume would be very complex and hard to predict (but it would be very easy to model -- and not very hard to model a number of traders doing maybe 80% of optimal trading... so maybe not hard to predict at all.) I have always been skeptical but willing to give it a shot.

What we should probably do is actually model the system and create constraints so that an optimal trader can always make between A and B credits per hour, no matter how many other traders are in the system. The previous system did this simply by never changing.

But in this case, manufacturing isn't part of the supply equation. We have unlimited supply of widgets, so supply will need to be determined by how much is being traded rather than how much is being manufactured. I'm not too sure either. I don't take Econ until Spring.

Yes I know all selling prices change over time but I didn't know buying prices slowly change. Other people talked about only a few other widgets but I've only seen "Purified water" change price. It only changed 1 or 2 credits from like 127 to 128. I think it would be cool if the buying priced changed even more but I am wondering if they were to be changing at all.

I noticed purified water in 13, short range monitoring equipment in 10, electronic components in 10 and 11, and mechanical components in 11. Anyone else notice others?

The non-local widgets change. IE: If you buy a widget made in sector 6 from the sector 11 station, said widget's buy price changes. However, locally made widgets (ie widgets made in sector 10 sold in sector 10) do not change. It'd be nice if they all changed noticeably. That way you could blockade a station (preventing traders from going there), let the widget buy prices drop, buy up a ton of cheap widgets and sell them at your discretion.

yes I agree. It would be nice to see the buy price dynamically change. If sectors could only produce x amount per hour then anything traded more then x would cause the buy price to rise, or if certain goods are needed to make something(y), if they are not sold they cannot be used to make y so there are less of the y iteams to buy makeing the price higher.

/me drools at the possible blockade benefits

Actually that's the only reasonable way to run an economy. Our current method just leads to rapid deflation. Widgets are being purchased at the same price no matter what, but demand (and therefore price) keeps dropping. It will replenish once the supply starts becoming scare again, but that doesn't seem likley to happen in the near future. Basically, we need a way to either regulate supply or drop prices of widgets that are being purchased a lot (due to the high demand.)

Don't you mean raise the price of widgets that are being purchased a lot? High demand means low supply means high prices. Low demand means high supply means low prices. Right now, the Itani widgets (s1) are worthless everywhere. However, they are not bought very much. So if the price dropped to 10c a widget because of low demand, they might be a good trade.

I was operating under the assumption that the non-dynamic widgets are essentially unlimited so, they do not actually enter the supply chain until you purchase them. So the more people purchase, the more supply in the chain = lower prices.

No, because prices do increase; stations which buy widgets do "consume" them, and the demand gradually increases again. What happens is that stations which produce widgets effectively produce an infinite number instantaneously on demand (or maybe they actually don't, but they fix the price to falsely limit supply -- whatever), whereas stations which consume widgets do so at a slow, constant pace. Therefore the whole economy either inflates or deflates depending on the amount of trading activity. The problem is that it's kind of backwards: more trading activity leads to deflation and less leads to inflation.

If stations actually had a limited supply of widgets, then there would be increased inflation as a result of increased activity. ...Or something.

I think we all need to take some more econ. classes.

/me is so confizzled.

What i was thinking was more along the lines of a basic function whereby an increase in the sale numbers of a certain widget in the station producing them would result in a reduction in the price. This would consequently lead to an oversupply of that type of widget elsewhere, lowering the price. Everything stays in balance. (actualy, this is probably pointless!)

What would be cool would be bulk discounts. Say in 5.5.7 when(if) we have larger semi capital cargo ships, with say 100 cargo, buying 100 widgets could result in getting a slightly cheaper price, 1700c instead of 1800c.

In that event, wouldn't it just make more sense to start trading with larger ships, which would just spur the same problem on a larger scale?

Ideally, I think everything should be dynamic, and the total amount of money should be held fixed - so that we have something more like a real economy. But then something has to be done about the fact that money appears out of nowhere with botting and flag caps...

To simplify, I'd leave production and consuption out of the model.

Instead, build a closed loop, where players earn money for keeping the loop in motion.

station 1 buys 100 C widgets and sells 1 A widget
station 2 buys 1 A widget and sells 10 B widgets
station 3 buys 1 B widget and sells 10 C widgets

The devs allocate an ammount of credits paid for making a complete loop, and then weight the station prices dynamically based on the current location of widgets.

One advantage of this system is that it's possible to model the ammount of money getting into the game. It's just a question of where that money is currently available for the taking.

It's also easy to set up longer loops, and multiple loops, which can each run independently without affecting each other.

And finally, it rewards players who take the time to learn the details, but not so much that newbies are hopelessly outclassed.

One of the problems with this is that hoarding can create a blockade of a trade route. A simple solution is to "tax" widget stockpiles, forcing the sale of them at a rate of some % per day.