AGEOD Forums

This may be a bit premature, since I'm still not sure how all the economic aspects of the game work, and I know that some parts haven't been implemented yet.

Anyway, I'm a bit concerned that a negative trade balance doesn't seem to carry any penalty at all. In the game it makes sense to just import as much food, and as many common/luxury goods as your population can buy, and then sell it on the internal market, without any regard to exports. In reality this would probably mean deflation, and economic stagnation.

The problem is that while your private capital is limited, the purchasing power of your population is not (in fact it is, but only on a turn-to-turn basis, not in the long run).

Is there some downside to having a trade deficit that I'm not seeing? Or maybe this will be remedied when some of the missing features are implemented?

I believe that the system works fine right now. If you go and buy everything on the market then your private capital will quickly diminish and cause massive inflation. Your populace is not "free" money, at least it hasn't seemed that way for me. If you would like to run an experiment and prove one way or another here is what I would do. Go to your trade screen and stop ALL exports. If your economy does just fine, then yes the economic system is messed up. If inflation begins to eat you alive, then I think the system works.

One thing that I think may be confusing people is that they see that their exports < imports, but really the equation should be (for game purposes) exports compared to imports+merchant revenues from trade fleets. People seem to ignore that they are getting money from that too and aren't factoring that in. TBH I'm not really sure what the trade fleet revenues represent in real life, but w/e.

DooberGuy wrote:I believe that the system works fine right now. If you go and buy everything on the market then your private capital will quickly diminish and cause massive inflation. Your populace is not "free" money, at least it hasn't seemed that way for me. If you would like to run an experiment and prove one way or another here is what I would do. Go to your trade screen and stop ALL exports. If your economy does just fine, then yes the economic system is messed up. If inflation begins to eat you alive, then I think the system works.

One thing that I think may be confusing people is that they see that their exports < imports, but really the equation should be (for game purposes) exports compared to imports+merchant revenues from trade fleets. People seem to ignore that they are getting money from that too and aren't factoring that in. TBH I'm not really sure what the trade fleet revenues represent in real life, but w/e.

In my current game as Prussia, I'd easily be able to stop all exports and still make a profit. I'd say that on average my imports are about 5 times my exports, and my income from the internal market is probably about 10 times the income from my export. Sure, you can't buy everything on the market, because there's a limit to how much you can sell on your internal market, but within that limit your population really does provide you with "free money".

And while it's true that your private capital has some income from transport fees (I assume this is supposed to be a profit from arbitrage), it's negligible. Usually it's between £2 and £4 for me, while my income from selling to the internal market is about £1000. I guess a country like England probably gets more, considering they're trading in many more trading zones, but I can't imagine it's really a big factor in their economy.