A Realm Reborn Economy and Archery Changes

[Raistlin]

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Recently, we reported on a Q&A session with Producer Naoki Yoshida about Final Fantasy XIV: A Realm Reborn, where he stated that the max gil allowed would be reduced to 10% of the current value (999,999,999 to 99,999,999). Well, it turns out it’s more complicated than that, and Yoshida has issued a clarification on the FFXIV forums.

It turns out that basically all gil is being reduced to 10% of its current value. This includes the prices of NPC goods, how much NPCs will pay for your items, the amount of gil received as loot and rewards, and, most significantly, the amount of gil currently in players’ possession. If you have 1,000,000 gil in the bank, when ARR is released you will no longer be a millionaire.

Apparently this major change is, in large part, an attempt to “rectify the increase in cost of items relative to the price of arrows, since archers in A Realm Reborn will no longer need arrows.” All archers will now apparently come with a Time Lord quiver that holds an infinite number of arrows.

Yoshida tried to assuage all the (rich) players:

In other words, all the hard work you've put into saving up gil won't be lost. Even though the gil you possess will become 1/10th what it currently is, we're adjusting NPC sale/buy prices to also become 1/10th what they are now, so relatively nothing will change. However, we do apologize that this may be a shock emotionally.

Additionally, Yoshida urged players not to panic and sell all their expensive stuff before it all becomes 1/10 of its current value. Well, first off, this makes no sense, as your gil will also be 1/10 of its value. Secondly, Yoshida stated that item values, effectiveness, and availability are being changed and tweaked as ARR is being developed, so you may end up screwing yourself over if that item actually becomes more useful or rare. He recommended people just stay the course, though unfortunately did not follow that up with this:

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Some people are apparently very unhappy with this decision, but inflation has historically been a terrible problem with MMOs. I think it’s good that the FFXIV development team are trying to get a handle on it, though we’ll have to wait until A Realm Reborn comes out to really see how the market reacts.

Source: ARR Gil Cap Reduction - Page 29

[Loony BoB]

I would say this is nothing short of realistic. When a giant meteor is threatening to crash into the world, one would expect many to hoard cash while many others would hoard items. Also, cash would inevitably be destroyed in such an event, so that could be used for adding further realism. But more to the point, it's not going to change anything's real value. I mean, I just don't get the outrage - some people are intent on being angry despite things being explained quite clearly. I wonder if these people would squeal like they won the lottery if they moved to Japan and got millions of Yen. I mean, really now... it's exactly the same.

[Raistlin]

Yeah, I think Yoshida was entirely right that the negative reactions are just emotional outrage at the thought of having some gil "taken away." The economy will definitely be changing for ARR, but this by itself keeps everyone the same relative to everyone else. That may just be too complicated for some gamers who feel entitled to what they had already earned.

[Ouch!]

I would wager that the attempt at price-fixing is a largely empty gesture. The problem is that even by reducing rewards and NPC buy/sell prices to 10% of their current value, this does little on its own to fix prices in a player-driven economy at such a target value. NPC buy/sell prices only add artificial price floors or ceilings on items which are obtainable via in-game merchants. However, a vast majority of the gear and materials required to craft that gear are not obtainable in this manner; and to ensure the continued necessity for the crafting and gathering classes, they likely never will be.

This measure will certainly reduce certain prices by simple virtue of removing 90% of the currency from the market, but that's hardly a long term solution, and I do not expect prices to stabilize at 10% of what they currently are. What's more likely to happen is exactly the way that Final Fantasy XI worked: NPCs buy prices will be so dismally low that it will never be viable to sell anything to them. Meanwhile, any gear that is worthwhile must still be crafted. This drives the demand for the raw materials to do said crafting. The system works from the gatherers to the crafters to the consumer. And while then you'd normally expect a 90% reduction in the currency available in-game to cause a similar devaluation for all items, it forgets one simple fact: an MMORPG's economy operates in the same manner as a regular economy except that there is no finite amount of money involved. Because money is generated from nowhere for quest rewards there is effectively an infinite amount of money in the game.

I expect prices to drop sharply right when 2.0 drops and everyone suddenly finds themselves with 100,000 G instead of 1,000,000 G, but over time they're just going to trend back up where they were before: especially since materia melding stimulates a ridiculous and perpetual demand for high-level equipment since it effectively becomes a consumable commodity (due to high failure rates of forbidden materia melds).

About the only thing that Square Enix could do to force a drop in prices on a more permanent basis would be to make the raw materials easier to come by. Given how easy they already are to obtain (beyond the initial time-sink of leveling the appropriate class), I find this to be unlikely.

That said, there are still too many variables to project exactly how this is all going to go down. So many, in fact, that there's really no way to even prepare for 2.0's Dalamud drop. My initial urge is to suggest that hoarding items rather than gil is the most prudent approach (as I believe they are less likely to devalue as much as your wallet is guaranteed to shrink), but again, there are so many different things that SE hasn't announced yet which could change that.

There's only two things I can really say headed into 2.0 for sure: first, that using the next month and a half to level jobs is by far one of the most productive options as those levels will not depreciate in any manner although the classes and jobs are changing; second, that while players transferring from 1.x to 2.0 are almost guaranteed losers in some manner, this is a definite win for anyone joining afterwards. They're cutting down on the financial advantage that any given player can hope to have moving into 2.0.

[Loony BoB]

That makes no sense, Ouch!. If everything drops by 90%, including the ways people can make gil (rewards, drops, etc), there is no way that prices will return to where they were before unless drops are changed in a very dramatic fashion (and this is not something we can predict will happen at present, we can only assume they will remain at similar levels until told otherwise). It simply wouldn't make sense. People would have to spend 90% more time generating gil if this were to happen, and that would require either 90% more time playing the game or things taking 90% more time to sell. I see no reason for prices to return to current levels. The gil isn't simply being removed - we are effectively going from one currency to another entirely, via exchange rate, and both happen to be called gil. This is a 100% cosmetic change in the gil system and the only adjustment at user end is psychological/emotional.

The worth of each gil you have will remain the same, minus one digit. The amount of gil you make from quests will remain the same, minus one digit. The amount that you can NPC items for will remain the same, minus one digit. They have stated already that this is not a change that will affect the value of anything.

Imagine if America had spent the last century or whatever never using the word dollar, only cents. Everything would cost the same, but without the decimal point before the two digits reserved for cents. Suddenly, they introduce dollars! It's a big change - cosmetically. It's a big change - psychologically, and emotionally. But they haven't taken away your money. They've just changed the value of a single unit of currency by a division of 100. The value of items hasn't changed, you'll buy things at the same price and you'll sell things at the same price. Just instead of saying it in terms of cents, you'll say it in terms of dollars, which are a division of 100.

This is exactly the same, but they have used the same name (gil / gil as opposed to dollars / cents) and they have used the a division of 10 instead of 100.

You could argue they have taken away anything between 0 and 9 gil from each character or retainer, I suppose.

New users will have no advantage or disadvantage beyond that which they might already have. Instead of earning 1,000 gil for something, they will earn 100 gil. And so on. Unless Yoshi-P is wrong/lying when he says that everything - rewards, gil drops, etc - will be cut by the same one digit, the economy will change very little. Of course, we all know that new content and new gilsinks will change things, too, but that's just how MMO's work.

[Del Murder]

Money is infinitely created but also infinitely destroyed. Every time you pay an NPC for something that gil is removed from the system forever.

Anyway, I like the idea of infinite arrows for archers. Ammo cost was always a big reason why I didn't play ranged classes in FFXI.

[Jiro]

Paying for individual arrows has always been a turn off for playing ranged classes. I'm happy to buy an infinite quiver with increasing levels of bonus damage but individual arrows are ugh. Unless it's something like Skryim where literally everything gives you arrows, it's just not manageable.

[Rostum]

I was starting to get sick of paying 40,000g or so for a stack of arrows... Good news!

[Ouch!]

I'm not saying that they're going to go ALL the way back up, but I sincerely doubt that they'll all settle as low as 10% of current value. My point was that quest rewards and NPC prices have increasingly insignificant impact on a player-driven economy as the game goes on. FFXI demonstrated this significantly. Prices on the auction house were vastly different from anything dictated by NPC prices or quest rewards (notably, absurdly bloated by comparison). I fully expect the same thing to happen in FFXIV. Eventually, prices will go up driven independently from whatever prices SE tries to artificially set. It happens in just about every MMORPG with a legitimately robust trading system between players, and I, for one, very much doubt that FFXIV will be any different.

[Del Murder]

What does an English major know about economics?

Anyway, it certainly will inflate because everything inflates eventually. But it shouldn't get close to where it was before, at least not for a long time. It would take a 1000% increase to offset a 90% decrease. Simple math!

[Goldenboko]

What does an English major know about economics?

Anyway, it certainly will inflate because everything inflates eventually. But it shouldn't get close to where it was before, at least not for a long time. It would take a 1000% increase to offset a 90% decrease. Simple math!

I... uh... don't see the simplicity in that math...

Original Price: x
90% decrease of original price: y = .9x
1000% increase to 90% decrease: z = 10y
z=x (?)
z = 10y = 10(.9)x = 9x
9x =/= x

[Goldenboko]

I'm so glad I'm an arts major and don't have to pretend like I understand this things.

It's a good idea for anyone to understand Algebra I hahaha.

[Raistlin]

What does an English major know about economics?

Anyway, it certainly will inflate because everything inflates eventually. But it shouldn't get close to where it was before, at least not for a long time. It would take a 1000% increase to offset a 90% decrease. Simple math!

I... uh... don't see the simplicity in that math...

Original Price: x
90% decrease of original price: y = .9x
1000% increase to 90% decrease: z = 10y
z=x (?)
z = 10y = 10(.9)x = 9x
9x =/= x

90% decrease does not mean 90% of the current value; that would only be a 10% decrease. So y = .1x. This would mean that the new price would have to increase by 1000%, or 10 times its new value, in order to reach its old value.

[Del Murder]

Freaking humantities majors!

[Raistlin]

Hey now, I was a history and poli sci double major! We're not all mathematically incompetent! Just... most of us.