Knootoss
12-09-2005, 21:36
This article is meant to point out that economy in NationStates isn’t just a single value that is "strong" or "Frightening". Your economy has many different aspects which have to do with nation as a whole, such as your laws, customs and government. Economy isn’t just a mathematical game of abstract graphs either, it is intensely political and vitally important for anyone interested in seriously roleplaying a nation.
The information that you have a "Frightening economy" alone is meaningless in roleplay, but it is often used as a justification for so-called wank. In the realities of roleplay, having a hardcoded frightening economy is not so important at all. (See: On power and wank (http://forums.jolt.co.uk/showthread.php?t=369284) in support of this argument)
How you roleplay your economy matters more because the game does not see if you have a capitalist or a communist leader, if you are in a recession, if all your infrastructure has been bombed to shit, if your uranium mines have run out and you need new sources for your nuclear programme, or if soaring unemployment is posing a threat to the stability of your monarchy.
Below I have listed, a bunch of things which are important when roleplaying your national economy. It is not an exhaustive list, but it deals with some of the most common issues.
Your political behaviour influences your economy!
Your international reputation matters a great deal to your economy. If your government does not honour contracts or nationalises foreign industries you will scare away investment and discourage business. The general state of your nation also affects this strongly. If your government is a bunch of corrupt fascists, businesses will not want to invest in your nation even if your taxes are low, and the businesses you have will prefer to go abroad.
Just arresting foreign citizens in your country and confiscating their property when you do not like them (something some players tend to do) is a GREAT way to permanently scare away all foreign investment, not just the investment of the victim! Who would want to go set up shop in a nation where every foreigner could be the next target?
If your government is seen as not honouring contracts, or not respecting other peoples property, this will seriously hamper your governments ability to import. This is not just about being denied to buy planes in storefront: if your government has an image problem everything from paperclips to insurance to tanks will become more of a problem for your government and/or your economy in general.
War, or even the threat of war has a huge effect on your economy. Continuing wars or even the threat of a serious war affects economic stability because of the uncertainty involved, even if no physical infrastructure is destroyed. States that get in wars often (for whatever reason) will have more difficulty attracting and keeping investment even besides the effect of military spending on your economy.
Resources matter in roleplay!
Production is often bottlenecked by specific resources, and political activity is often centred on securing resources perceived to be creating a bottleneck. Oil is the most well-known example, but states can also clash about the flow of rivers and the use of their water for example.
Yes, it is true that you can theoretically just claim that your nation conveniently has every type of imaginable resource, neatly arranged in mines and shops all over the country which all magically renew themselves. A lot of people do this and claim then that their nation is completely self-sufficient, but it is a wanky thing to do. You don't want to be wanky, do you?
An example of using resources in roleplay would be having a lot of one particular resource (say, natural gas) but being dependent on other nations for other resources (for the sake of argument, uranium). If your nation wants to pursue a nuclear programme, it will have to procure military-grade uranium somewhere first. You can roleplay this, and others can offer to help you or perhaps even try to prevent you from getting it! (And you could do the same to others.)
Trade is vital to economic development!
Trade is not just a “nice to have” thing that you do with your IC buddies , it is vital to for any nation that isn’t Tibet or Amazone Tribistan and you will want to trade with as many nations as possible (and responsible according to your political views.)
No RL nation is completely self-sufficient, and all RL first world economies are highly interdependent. Well-developed economies seem to require trade and the exchange of resources because (1) not every resource is available in every country, and (2) some countries are better at producing certain things. This is called comparative advantage.
This is also why cutting off trade with a nation completely is usually a Very Bad Thing, especially if you traded with that nation before. The sums of money and the economic efficiency that is destroyed by trade embargoes is huge. In NS we are talking of trillions of dollars cost to your nation when you embargo a single other nation. This cost is especially high when you already traded with someone because you destroy existing ties, but not trading with someone also means denying yourself potential trillions. Think of that before you casually put someone on a blacklist!
Your nation has Economic Cycles too!
The term ‘business cycle’ or ‘economic cycle’ refers to ups and downs seen somewhat simultaneously in most parts of an economy. The cycle involves shifts over time between periods of relatively rapid growth of output (recovery and prosperity), alternating with periods of relative stagnation or decline (contraction or recession). These fluctuations are often measured using the GDP, but recessions also affect things like unemployment, consumption, inflation, etc. Having a largely socialist economy or a dictatorship does not eliminate the business cycle.
It is unrealistic to roleplay a constantly booming economy. Your economy will slump at times despite your brilliant economic policies, and this will affect your politics too. (It lessens your ability to buy those super ray guns and people will vote against your governments parties, for example.) Roleplaying a recession now and then is a good thing.
Think of the trees! (You’ll want to keep some to cut down later)
People produce waste. Waste creates disease and other undesirable effects. Sewage systems, garbage collection, clean air laws and recycling are all results of the need to dispose of after effects, and take up a significant fraction of the political life of most localities. Ecological systems and human beings can only carry so much damage before they, well, die. This is not just commie hippy talk. It happens.
If you RP having no environmental laws or when your dictatorship does not care about the health of its citizens at all, you should also RP how you deal with the effects and your people should suffer as well. In the long term, the economy will suffer as well.
There are of course ways to deal with this (exporting waste, factories abroad, ridiculously expensive healthcare systems, genetically engineering people to like toxic rain…) but at least you can roleplay it rather than just ignore it.
You need infrastructure to function!
In order to function well, a state needs transport and communication grids, such as trains and roads and telephone lines, or shuttle services and starports if you are future tech. Nations which have been bombed to hell, nations with no functioning government, etc, get into big trouble for obvious reasons. When your nation has been bombed, you might want to prioritise building new farms over more weapons factories.
In war, it is important to consider the economic infrastructure of the enemy in addition to his military forces only.
Mind your tax rates!
Money does not find its way into your coffers magically, so you might want to think about your tax rate, how high is it and who is paying your taxes? (Do you tax working class people? Very high corporate tax? Environmental taxes?) Your tax rate must match your political systems: a “capitalist” economy with 69% taxes to fund its defence rankings will collapse. 0% and 100% taxes tend to be impossible oddities, although they may be explained away by roleplay.
Your tax rate must also match what you claim to spend. To claim that you have no taxes and at the same time claiming to have a huge military is plain godmoding.
You need capital!
Having a lot of people and resources is not enough to have a well-developed economy. You need capital too. “Capital” in the broad sense is any tool needed to help raw labour with production. There are three types of capital:
Physical capital, tangible objects which, when employed, allow greater production.
Intellectual capital, the concepts, ideas, designs, theories and information which allows an individual to act with greater effectiveness. Physical capital implies an intellectual capital required to use it.
Human capital can be described as the readiness of labor to use capital, and includes education, social norms, ethical understanding, networks of relationship and communication, health and general well being.
Weapons are also capital. NS States pursue policies, in no small degree, to be able to produce the capital of projecting power and force. Often the projection of force is to acquire resources required for production, or the opening of labor to be utilized in production, or to open markets for the results of national production. (Think of the Opium wars, for example.)
Too often nations with an entirely uneducated population claim to be able to produce advanced spaceships (while lacking the intellectual capital). Rankings matter, spending money only on your military means condemning your nation to the stone age economically. (A RL example would be the fascist government of Portugal, which distrusted higher education because it would be liberal and destabilising to the regime. They quickly became the most backward economy of Europe)
If you keep your people as slaves in small huts with no civil rights at all, the economy will suffer. If you just disallow, say, the internet or foreign television and news or if you think your minions should not be visiting foreign scientific symposia this will also make your economy more backward.
The most important example of waste in NS: Forcing people to spend 10 years or so in the military will waste their economic potential because you deny them to the economy in their most production states. If you maintain a barracks state, like some nations do, it will seriously hamper your entire economy including your arms industry. People that mention North Korea as an example… well, look at their economy and I think the point is made. Maintaining a totalitarian barracks state and a decent economy is impossible.
Some final notes
If you want to give your nation some depth, take the time to think about the history, culture, and government of your nation and what this means for your economy.
For information about political ideologies and their relation to economics I’ll gladly refer to Government Definitions; All About Economies (http://forums.jolt.co.uk/showthread.php?t=408438) by Euroslavia.
The information that you have a "Frightening economy" alone is meaningless in roleplay, but it is often used as a justification for so-called wank. In the realities of roleplay, having a hardcoded frightening economy is not so important at all. (See: On power and wank (http://forums.jolt.co.uk/showthread.php?t=369284) in support of this argument)
How you roleplay your economy matters more because the game does not see if you have a capitalist or a communist leader, if you are in a recession, if all your infrastructure has been bombed to shit, if your uranium mines have run out and you need new sources for your nuclear programme, or if soaring unemployment is posing a threat to the stability of your monarchy.
Below I have listed, a bunch of things which are important when roleplaying your national economy. It is not an exhaustive list, but it deals with some of the most common issues.
Your political behaviour influences your economy!
Your international reputation matters a great deal to your economy. If your government does not honour contracts or nationalises foreign industries you will scare away investment and discourage business. The general state of your nation also affects this strongly. If your government is a bunch of corrupt fascists, businesses will not want to invest in your nation even if your taxes are low, and the businesses you have will prefer to go abroad.
Just arresting foreign citizens in your country and confiscating their property when you do not like them (something some players tend to do) is a GREAT way to permanently scare away all foreign investment, not just the investment of the victim! Who would want to go set up shop in a nation where every foreigner could be the next target?
If your government is seen as not honouring contracts, or not respecting other peoples property, this will seriously hamper your governments ability to import. This is not just about being denied to buy planes in storefront: if your government has an image problem everything from paperclips to insurance to tanks will become more of a problem for your government and/or your economy in general.
War, or even the threat of war has a huge effect on your economy. Continuing wars or even the threat of a serious war affects economic stability because of the uncertainty involved, even if no physical infrastructure is destroyed. States that get in wars often (for whatever reason) will have more difficulty attracting and keeping investment even besides the effect of military spending on your economy.
Resources matter in roleplay!
Production is often bottlenecked by specific resources, and political activity is often centred on securing resources perceived to be creating a bottleneck. Oil is the most well-known example, but states can also clash about the flow of rivers and the use of their water for example.
Yes, it is true that you can theoretically just claim that your nation conveniently has every type of imaginable resource, neatly arranged in mines and shops all over the country which all magically renew themselves. A lot of people do this and claim then that their nation is completely self-sufficient, but it is a wanky thing to do. You don't want to be wanky, do you?
An example of using resources in roleplay would be having a lot of one particular resource (say, natural gas) but being dependent on other nations for other resources (for the sake of argument, uranium). If your nation wants to pursue a nuclear programme, it will have to procure military-grade uranium somewhere first. You can roleplay this, and others can offer to help you or perhaps even try to prevent you from getting it! (And you could do the same to others.)
Trade is vital to economic development!
Trade is not just a “nice to have” thing that you do with your IC buddies , it is vital to for any nation that isn’t Tibet or Amazone Tribistan and you will want to trade with as many nations as possible (and responsible according to your political views.)
No RL nation is completely self-sufficient, and all RL first world economies are highly interdependent. Well-developed economies seem to require trade and the exchange of resources because (1) not every resource is available in every country, and (2) some countries are better at producing certain things. This is called comparative advantage.
This is also why cutting off trade with a nation completely is usually a Very Bad Thing, especially if you traded with that nation before. The sums of money and the economic efficiency that is destroyed by trade embargoes is huge. In NS we are talking of trillions of dollars cost to your nation when you embargo a single other nation. This cost is especially high when you already traded with someone because you destroy existing ties, but not trading with someone also means denying yourself potential trillions. Think of that before you casually put someone on a blacklist!
Your nation has Economic Cycles too!
The term ‘business cycle’ or ‘economic cycle’ refers to ups and downs seen somewhat simultaneously in most parts of an economy. The cycle involves shifts over time between periods of relatively rapid growth of output (recovery and prosperity), alternating with periods of relative stagnation or decline (contraction or recession). These fluctuations are often measured using the GDP, but recessions also affect things like unemployment, consumption, inflation, etc. Having a largely socialist economy or a dictatorship does not eliminate the business cycle.
It is unrealistic to roleplay a constantly booming economy. Your economy will slump at times despite your brilliant economic policies, and this will affect your politics too. (It lessens your ability to buy those super ray guns and people will vote against your governments parties, for example.) Roleplaying a recession now and then is a good thing.
Think of the trees! (You’ll want to keep some to cut down later)
People produce waste. Waste creates disease and other undesirable effects. Sewage systems, garbage collection, clean air laws and recycling are all results of the need to dispose of after effects, and take up a significant fraction of the political life of most localities. Ecological systems and human beings can only carry so much damage before they, well, die. This is not just commie hippy talk. It happens.
If you RP having no environmental laws or when your dictatorship does not care about the health of its citizens at all, you should also RP how you deal with the effects and your people should suffer as well. In the long term, the economy will suffer as well.
There are of course ways to deal with this (exporting waste, factories abroad, ridiculously expensive healthcare systems, genetically engineering people to like toxic rain…) but at least you can roleplay it rather than just ignore it.
You need infrastructure to function!
In order to function well, a state needs transport and communication grids, such as trains and roads and telephone lines, or shuttle services and starports if you are future tech. Nations which have been bombed to hell, nations with no functioning government, etc, get into big trouble for obvious reasons. When your nation has been bombed, you might want to prioritise building new farms over more weapons factories.
In war, it is important to consider the economic infrastructure of the enemy in addition to his military forces only.
Mind your tax rates!
Money does not find its way into your coffers magically, so you might want to think about your tax rate, how high is it and who is paying your taxes? (Do you tax working class people? Very high corporate tax? Environmental taxes?) Your tax rate must match your political systems: a “capitalist” economy with 69% taxes to fund its defence rankings will collapse. 0% and 100% taxes tend to be impossible oddities, although they may be explained away by roleplay.
Your tax rate must also match what you claim to spend. To claim that you have no taxes and at the same time claiming to have a huge military is plain godmoding.
You need capital!
Having a lot of people and resources is not enough to have a well-developed economy. You need capital too. “Capital” in the broad sense is any tool needed to help raw labour with production. There are three types of capital:
Physical capital, tangible objects which, when employed, allow greater production.
Intellectual capital, the concepts, ideas, designs, theories and information which allows an individual to act with greater effectiveness. Physical capital implies an intellectual capital required to use it.
Human capital can be described as the readiness of labor to use capital, and includes education, social norms, ethical understanding, networks of relationship and communication, health and general well being.
Weapons are also capital. NS States pursue policies, in no small degree, to be able to produce the capital of projecting power and force. Often the projection of force is to acquire resources required for production, or the opening of labor to be utilized in production, or to open markets for the results of national production. (Think of the Opium wars, for example.)
Too often nations with an entirely uneducated population claim to be able to produce advanced spaceships (while lacking the intellectual capital). Rankings matter, spending money only on your military means condemning your nation to the stone age economically. (A RL example would be the fascist government of Portugal, which distrusted higher education because it would be liberal and destabilising to the regime. They quickly became the most backward economy of Europe)
If you keep your people as slaves in small huts with no civil rights at all, the economy will suffer. If you just disallow, say, the internet or foreign television and news or if you think your minions should not be visiting foreign scientific symposia this will also make your economy more backward.
The most important example of waste in NS: Forcing people to spend 10 years or so in the military will waste their economic potential because you deny them to the economy in their most production states. If you maintain a barracks state, like some nations do, it will seriously hamper your entire economy including your arms industry. People that mention North Korea as an example… well, look at their economy and I think the point is made. Maintaining a totalitarian barracks state and a decent economy is impossible.
Some final notes
If you want to give your nation some depth, take the time to think about the history, culture, and government of your nation and what this means for your economy.
For information about political ideologies and their relation to economics I’ll gladly refer to Government Definitions; All About Economies (http://forums.jolt.co.uk/showthread.php?t=408438) by Euroslavia.