NationStates Jolt Archive

How do I make my economy flourish? I encourage business, permit free trade, insist upon fair employer-employee working relationships, and have a moderate income tax rate. Yet there are many nations with a superb economy who have a 100 per cent income tax rate. If everyone is taxed at 100 per cent, not only is there no incentive to work, but the population will either rebel or emigrate

My countries' economies range from reasonable to strong, but how it works is beyond me.
The government types vary from New York Times Democracy to Father Knows Best State to Conservative Democracy, so I don't think that has too much of an effect on it.
Two have higher tax rates for the rich, and all average over 30%.
I'm pretty new at this myself, so I could be wrong.

It could take a while for your economy to recover... I have heard that stats can go negative ie.. you can have a negative economy instead of no economy... so to fix this you just have to keep answereing issues pro-economy way to boost your economy. If that is what you want to do.... there is no shortcut to increasing your economy as issues are the only things that effect it.

Well, fair employer-employee treatment won't get your economy going. You should be pro employer and against rights of the employee, that will make business invest in your country -> no costly welfare/benefits, no minumum wage, allow to fire on the spot etc.

Abbtalia I do not know what business school you went to but modern economics recognises that a stable skilful contented workforce is an essential prerequisite for a successful economy. The measures you advocate will certainly work in the short term. I do not believe in workers having too much industrial muscle, but able to share in the benefits of a successful economy.
There is a second point in my post which has not been addressed. Any economy which has 100 per cent average tax rate is a financial disaster, but this game does not recognise this fact.

I believe that this is down to the game coding - tax and the economy are calculated separately. Similar to how you can have contradictory information in the nation blurb.

you can have contradictory information in the nation blurb.

The whole thing's contradictory.

You have to be pro-business and pro-corporation for your economy to take off.

Basically when you get an issue and one of the people is CEO of something, support them.

Well, you haven't actually supported your position regarding the impossibility of a strong economy with a 100% income tax rate, so I'm not sure why it should seem strange that nobody has addressed it.

There are different kinds of economy: in the Tahuantinsuyu Empire, we have no currency and no tax, and are reliant upon the mita obligation, in which people work for part of the year (presently 40%, eventually 20%) to support themselves and their family, and in the remaineder of the year for the state. Since the land belongs to the state and can be taken away from anyone who decides that he wants to steal it by working 100% of the time for himself, there's a pretty serious motivation to stick to the job.

If the Sapa Inka decided that it was proper, he could decree that all work and product go directly to the administration of the state, represented in game by a 100% income tax. Since he's the son of the sun, people tend to listen to him, much as the prospect of being thrown off a cliff grabs their attention, and, more than that, the though of being shut-out of land leasing and of distribution of the products of said land will tend to convince someone to prove that he'd work hard and contribute. For anyone who's prepared to pull their weight, the reward of hand-outs and a home would leave no particular reason to emmigrate, though, as with any country in the world, people would presumably try, so, big deal.

Everyone in the country, potentially, gets enough to eat and a place to live, infrastructure is built, clothes are distributed, an army is raised and maintained. Importantly, exports are of different importance in different nations: Tahuantinsuyu may not produce goods efficiently in respect of global market value, but we could not possibly care less, because unless we choose to expose ourselves to someone else's market, it does not concern us. It is still a strong economy, because it satisfies needs and reliably so, regardless of an irrelevent market value.

More to the point, more simply, suggesting that the only motive to work is so simple as you suggest is akin to the claim that only fear of god's punishment on judgement day is the only thing that keeps people from killing one another.

You do not have to be pro-corporate for your economy to take-off, either in NS or reality.

How important is the Economic rating? In RP, I'm a space-faring nation with an economy totally different from anything on Earth. The rather free-wheeling hippy-like lifestyle that would lead to an "imploded" economy in RL (and in NS, based on my stats), might not hurt a space-faring race.

Depends with whom you play. I often RP Lusaka as having a weaker economy than my nation page suggests, since in RP the government is committed to Ujaama (familyhood, a sort of primitive African socialism), and always with a much smaller population. So long as you prove yourself an interesting an reasonable story-teller or role-player, most good players won't mind if you don't stick exactly to what the nation page says. Some might have a problem with you claiming much greater capabilities than your nation appears to give you, but since it's so ridiculously easy to achieve a Frightening economic rating in a matter of days or weeks, it's rather pointless for anyone to get hung-up on it. Of course, that's just my take on it, but I have been here for years and interacted with a lot of good players, so I'm quite confident that it holds true.

Guys, don't even bother trying to explain economics in this game.

I have 0% income tax. However, when I run my government by ANY of the economy analysis programs, I always end up having a government budget. And not just a little one... a budget bigger than most other nations of similar size...

The economics in this game isn't made to make logical sense. Accept it, and move on in life.

Just because you don't have income tax doesn't mean you don't collect money. Goods and Services Tax (GST), VAT, sales tax, duties and tariffs are all ways of the government collecting money without resorting to an income tax.

Don't forget, countries with a 0% tax rate often don't have official governments; they're run by conglomerates and monopolies. Since there isn't a real government existant, the administration costs are taken from the real powers: big business. This is a perfectly logical reason why administration costs under governments with a 0% tax still have massive administration budgets.

Abbtalia I do not know what business school you went to but modern economics recognises that a stable skilful contented workforce is an essential prerequisite for a successful economy. The measures you advocate will certainly work in the short term. I do not believe in workers having too much industrial muscle, but able to share in the benefits of a successful economy.
There is a second point in my post which has not been addressed. Any economy which has 100 per cent average tax rate is a financial disaster, but this game does not recognise this fact.
Correct, but Abbtalia is right in this instance. The game works that way. It needs revision if you ask me.

I don't see the reasoning behind a 100% tax rate nation being in "financial disaster". Where's the proof behind such an assertion?

I don't see the reasoning behind a 100% tax rate nation being in "financial disaster". Where's the proof behind such an assertion?
How would the citizens spend anything? The government would spend their money for them. It is effectively an end to the free market. Such states do not end well.

I keep seeing countries that list this as ther economy but it does not explain it anywhere. :headbang:

I keep seeing countries that list this as ther economy but it does not explain it anywhere. :headbang:
If you can find the NS nation tracker, it explains everything in reasonable detail.

How would the citizens spend anything? The government would spend their money for them. It is effectively an end to the free market. Such states do not end well.

Not true. States with 100% tax rates don't have to spend all of their people's money for them (or even any); they can redistribute it among the people, still allowing economic freedom while providing necessary benefits for free. In addition, some economic systems, like democratic socialism, combine the market and political field together in a democratic voting ring which essentially merges the money vote and political vote into one streamlined system. This also allows for economic freedom, and prevents abuse (and subsequent command economy tendancies) by a small group of CEOs or the like.

Not true. States with 100% tax rates don't have to spend all of their people's money for them (or even any); they can redistribute it among the people, still allowing economic freedom while providing necessary benefits for free. In addition, some economic systems, like democratic socialism, combine the market and political field together in a democratic voting ring which essentially merges the money vote and political vote into one streamlined system. This also allows for economic freedom, and prevents abuse (and subsequent command economy tendancies) by a small group of CEOs or the like.
Ever seen an economy like this work in the real world? I doubt it. Even the Scandinavian countries are still free-market economies with strong welfare components. Welfare capitalism in essence. They are the only functional economies of their kind in the world, with some few exceptions.

Giving the government such power is idiotic at best. It gives it free rein and unlimited control over citizen's lives. It is an invitation to be as corrupt as possible. I'd prefer anarcho-socialism to it, and even that is a theory I think little of. The assumption that a government will always look out for a citizen's interests is naive. A small group of CEOs becomes a small group of government officials who slowly erode any democratic powers inherent in the system.

My Nation has 100% tax rate and Private Enterprise is banned. Yet we have a Frightening Economy because we don't care about the enviroment or morality at all.

A 100% average tax rate implies that every citizen contributes all his/her income to the state. That is simply impossible. There will always be in every society those who wish to avoid/evade paying tax. Any single person who manages to retain any income whatsoever means that the average falls below 100%. There will always be those who wish to have more than their fellow human beings, whether they are criminals, entrepreneurs or whatever.
Even China, in its most Maoist extremes, allowed its citizens to retain a little income.
In my view any society which deprives its citizens the right to retain even a modest proportion of the individual's income will very quickly disintegrate, probably violently. This is a major flaw in this game and I suggest that any country which allows such a situation to be maintained for a period, say three months, should be forced to lower its income tax, or face an insurgency.

"Even China, in its most Maoist extremes, allowed its citizens to retain a little income"

And that worked really well, and nobody was left to fend for themselves and starved as a result. Okay.

You're being far, far too ethnocentric, and need some buzz words about boxes and envelopes.

yes, er, how do you "up" your economy, eh?

Here's a pretty handy site; it won't explain anything, but its like a window into the mechanics of NS. Also, it tells you a lot more than the crap on your NS page:

http://nstracker.retrogade.com

why thank you.

How do I make my economy flourish? I encourage business, permit free trade, insist upon fair employer-employee working relationships, and have a moderate income tax rate. Yet there are many nations with a superb economy who have a 100 per cent income tax rate. If everyone is taxed at 100 per cent, not only is there no incentive to work, but the population will either rebel or emigrate

My state is the closest thing to a pure and complete communist nation. The tax rate is high (used to be 100%), but the people get superb education, health care, and security as my nation is "crime free". Of course it wouldn't work in the real world, but this is a game. You could try giving people benefits equal to the amount of tax they pay, like I try to do.

Let's cut to the chase.
ANY simulation which permits a 100% average tax regime to exist for any period of time is so fundamentally flawed that there is no reality. I therefore challenge the game's creators to justify such a lunacy or correct the defect.

Let's cut to the chase.Okay.

ANY simulation which permits a 100% average tax regime to exist for any period of time is so fundamentally flawed that there is no reality. I therefore challenge the game's creators to justify such a lunacy or correct the defect.Main Entry: sat·ire
Pronunciation: 'sa-"tIr
Function: noun
Etymology: Middle French or Latin; Middle French, from Latin satura, satira, perhaps from (lanx) satura dish of mixed ingredients, from feminine of satur well-fed; akin to Latin satis enough -- more at SAD
1 : a literary work holding up human vices and follies to ridicule or scorn
2 : trenchant wit, irony, or sarcasm used to expose and discredit vice or follyWhy is my nation so weird?

Everything is exaggerated a little. Well, okay, a lot. Your decisions affect your nation very strongly, so your country might seem like a more extreme version of what you were aiming for. Unless you have radical politics. In which case you probably think nothing's wrong.This isn't Civilization or Sim City; it's NationStates. If you want a serious and realistic similator, you're in the wrong place.

Let's cut to the chase.
ANY simulation which permits a 100% average tax regime to exist for any period of time is so fundamentally flawed that there is no reality. I therefore challenge the game's creators to justify such a lunacy or correct the defect.


The chase has been cut-to several times before, you seem to be simply too far sunk into your own bottom-end to understand. Try cracking-open your skull, this may help.

You are thinking of a capitalist society with a 100% tax rate, which is an impossible thing, which you appreciate.

You do not seem to appreicate that anything exists outside of your own fundamentally limited experience, id est diluted capitalism.

It is impossible to defend a position upon which nobody stands.



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X people come together, they divide their land after democratic consultation on how much goes to whom. People work it, and then put their product into a pot, seeing it recorded. Steve's family grows cabbages, Mary's grows maize.

Steve gets some maize, Mary gets a cabbage.

Steve throws a hissy-fit and says that he grew that damn cabbage and Mary shouldn't have it.

Society takes away Steve's land, because Steve is a dick, and he dies.

Steve's son, Bob, grows another cabbage, and learns to share.

Bob doesn't die.

Bob feels motivated.

This may not work in the global free-market, because it emphasises simple diversity and volume over market value, but there is absolutely no reason why this society should choose to throw itself on the mercy of the market in the first place. Kept self-reliant or within a protected trade-bloc, it is perfectly strong.

Not everybody wants to play with you. Sorry.

Okay--there is no reality in the game.
But I really can not allow T-Empire to get away with his flawed logic. His model land has zero income tax because as all products are shared they are all equally worthless. A product only has value when it is used for trade or barter. In his Ruritanian society everything is shared so there is no need for any tax. Income is only obtained when something is traded.
Furthermore Steve may have had a hissy fit because he was much better at growing cabbages than Mary was at growing maize, and resented having to share his plentiful, healthy cabbages with Mary whose maize crop was disease-ridden and paltry. So when society takes away Steve's land and he dies, Bob realises that there is no point in learning how to grow more cabbages and he will only grow the minimum that he can get away with. So production falls, and as everyone shares products, everyone eventually dies of starvation.

Okay--there is no reality in the game.
But I really can not allow T-Empire to get away with his flawed logic. His model land has zero income tax because as all products are shared they are all equally worthless. A product only has value when it is used for trade or barter. In his Ruritanian society everything is shared so there is no need for any tax. Income is only obtained when something is traded.
Furthermore Steve may have had a hissy fit because he was much better at growing cabbages than Mary was at growing maize, and resented having to share his plentiful, healthy cabbages with Mary whose maize crop was disease-ridden and paltry. So when society takes away Steve's land and he dies, Bob realises that there is no point in learning how to grow more cabbages and he will only grow the minimum that he can get away with. So production falls, and as everyone shares products, everyone eventually dies of starvation.

The why did such a system work out for Cavemen and Aboriginals. Now with modern technology there is capability to create a large surplus.

As a counter to your own argument, what motivation does Bob have in making more Cabbages? If he decided to not grow as many cabbages and claiming that there is a cabbage famine, he can jack up the price of his cabbages due to the lower supply against demand. That would also hurt Production.

Well, fair employer-employee treatment won't get your economy going. You should be pro employer and against rights of the employee, that will make business invest in your country -> no costly welfare/benefits, no minumum wage, allow to fire on the spot etc.

Never comply with capitalism........

Easiest methods of improving your economy? Follow the following:

a ) Do not choose any selection that offers to spend money. Dismiss them. Hell, dismiss every issue for weeks and your economy might improve.
b ) Select protectionist trade tactics. There's an issue in which the head of the union requests that you raise tariffs to protect local industry. Choose the first option.
c ) Wait.

Yes, nothing is perfect. Yes, it will take time. Once you obtain a "Frightening" economy, however, all is good.

All the arguments against 100% tax rates and good economies assume that people are selfish, which, in RL, they are. However, in the context of this game, it's entirely possible that the citizens of my country are all selfless and work as hard as they can in order to benefit the country as a whole.