Thank you for explanation, so it is mainly as I feared.George Geczy wrote:During the development of Update 3 (and as part of some of the beta-test versions of U3 released over the last few months), a number of economic changes were made.
One set of changes involved the calculation of production costs as resource availability and gdp values change, etc.
You have true, but mainly for countryes with "market economy" (globalised capitalism).George Geczy wrote:While at first glance it may seem that a country (ie, US) should not have its production costs change due to external factors (such as a world shortage), this actually only holds true for a perfect state-controlled system. In reality, the US (and even the communist countries of the 1950's) have market forces affect the costs of their goods. In a capitalist economy this would include things like profits to the corporations, etc. So when the world price of oil rises, even the cost that the US government pays to buy its own oil goes up.
However, this is not so true in countryes with "planned economy" (socialistics countryes trying to build communism = warsaw pact).
You see, in "planned economy" everything is in "tons", "liters" and so, there was no price involved. Goods was priced by market value only when they leave "domestic/warsaw pact" union, and enters the world market with rest (mostly capitalistics) countryes. So warsaw pact have almost "resource based economy" inside, and "market economy outside". When there was not enought of some resource, there was simple not enought such goods in shops. When there was plenty of resource, but on capitalistics external world market price of that resource was rising, they shift more resource to sell on global market for USD, and there was less for domestic production/consupmtion.
US was heavy depending on importing OIL all the time, much much more than Warsaw pact. Warsaw pact have imported oil from Soviet Union, and many times it was barter agreement. When in 80' was economy crisis in west market countryes, we in "communism" was not know about that. Again, in "planned economy" you have every year goal, like pump such amount galons of OIL, and that amount will go to those factories and etc. When you produce more, it would be probably salled on capitalistic market for current market price. Prices was always printed directly from factoryes on every good (every shop was having exact the same prices), and some have not changed over 5-10years, despite big economy crisis in west.George Geczy wrote:This is admittedly imprecise and maybe even a bit arbitrary, but it is more realistic than having an world "OPEC" price for oil at $60/barrel and having the US govt pay $6/barrel to produce its own oil. More importantly, this change significantly increased both the realism of the economic model, and also improved the gameplay, preventing many exploits and ahistorical results.
Therefore was I see important:
PRODUCTION COST should be calculated only from (related to):
1) AVERAGE ACQUISITION COST of current state=domestic SUPPLY of necessary comodities/resources (=national asset).
2) AVERAGE DOMESTIC WAGE
AVERAGE DOMESTIC WAGE can be calculated as % from GDP with undirect correlation to the unemployment (probably more complicated calculation needed)
AVERAGE DOMESTIC CONSUMPTION should be calculated as: ( (AVERAGE DOMESTIC WAGE) - (DOMESTIC TAXATION) ) / (domestic price of consumer basket)
When you calculate production costs from global market prices, than domestics economy does no matter anymore.
Production costs must be always calculated only from domestic prices (from assets = average price of supply), as it is in reality. When they does not have enought resources in supply to produce, they simply must buy that resource from global market (or production drops), and that change average domestic price of that resource. In case that country have no own production of that resource, all is imported, that of course average domestic resource price would be the same as global market price for that resource. But it seems, that you in game don't calculate value of national assets (supply) at all. And this is from my point of view first and main problem.
Without this, you can not simple calculate domestic prices, domestic consumption. Because in your game you can not have country with small GDP, which can have still bigger living standard and bigger domestic consumption, than country with much much bigger GDP. But this was right fro some countryes in history. GDP does not mean anything in real economy.
When country is creating huge oil reserve for 2 years, when OIL is cheap, and next 2 years, when oil prices are trippled, that country do not need to buy oil, but simple work from oil reserves (national asset/supply). Therefore, that country can produce products for domestic economy still cheap as beffore, despite that rest of world production costs are tripled!
Please, consider to change current model. This is only one "close to reality" simulator on the world (at least for me). And domestic economy VS export is base of every economy model. There is important difference between "market economy" = (in capitalism) and "planned economy" = (in socialism=communism). Right now, as it is, it is simulatin only WEST global economy.
