Economy Simulation Model
I am From Thailand
- May 4, 2021
Economy Simulation Model
Draft // Early Revision
Draft // Early Revision
Hi, my fellow roleplayer! I am here to present my suggestion for the revamp of the current economic model. I have inspiration from Jamie's Resource Management System suggestion. It is not quite the same subject, but it also includes resources, but I will be present in the Economy Simulation term.
This Economy Simulation Model will simulate the wealth of each resource involved in the economy. This involvement will be how each individual in your country impacts the supply and demand and how they contribute to the market to create wealth from each resource. I will have the process of simulation below.
As you can see from this image, there will be two main processes for this simulation. We will now go into the theory of economics and a little about mathematics.
The first equation
It is about how individuals can survive based on the money inside their pockets. Naturally, if a person has more Income than Consumption or expense, they will live through the day. If they have more Consumption than their Income, they will likely not survive in the economy. In this simulation, we will assume that everyone, even poor people, can manage their Consumption to be less than their Income for themselves to survive. This concept gives us the first equation.
The second equation
This one is about how we can find the Income that such individuals gain from such resources. As stated, Income can be either by direct gathering (G) or trade (T). The direct gathering example is a portion of their salary from how resource contributes its wealth to the economy and pay back to such individual. The Income from trade can be the supply and demand of how such individuals contribute to the market.
The third equation
We have to include the Utility Function. In economics, utility represents the satisfaction or pleasure that consumers receive for consuming a good or service. The utility function measures consumers' preferences for a set of goods and services (according to Investopedia). A utility Function is a mathematical function that ranks alternatives according to their utility to an individual. It is how much any individual is willing to contribute to the resources and wealth. We will determine our Utility Function by subtracting Income from Consumption.
The fourth equation
We will now discuss how much resources are being traded in the system. This one is about the dynamics of traded resources. The idea of this simulation process is to find how much of such resource can contribute to its total wealth and any individual income. The equation to find Tr is Br - Sr. Br and Sr are the balances of resources bought and sold. With this system, we can simulate its dynamic of it.
The fifth and sixth equation
This one is simple. If we want to know the number of resources bought or sold, it depends on the availability of money (M) and the price (P) paid for the resource by the agent (a). Since this equation introduces the term agent, I will clarify it. It is the same for individuals, but from my research and the model that I am based on, they use the term agent. (https://arxiv.org/ftp/arxiv/papers/1509/1509.04264.pdf)
The seventh equation
This equation is all about how much money any individual has. As mentioned in the image, we will have to determine a fixed value of Ma0 as the starting wealth of such an individual. We will add it with the amount of money they gain from selling resources and subtract from how much they earn buying them.
When we have finished simulating and calculating all values in the process, we can use the formula to find the total wealth of each resource. For the current concept, we can simulate the total wealth of agents of the individual by dividing them into three groups. There are the poor, the middle-class, and the rich. We can give a percentage of each group to the population of each country and give them a constant amount of such as Ma0, Pra, Gr, and Cr. I have an example of the calculation below.
IV. The calculation and simulation process
V. How can this affect the gameplay and mechanics?
This Economy Simulation model can be used to "simulate' the economy of each nation. We have defined the number of each individual in each group of income for each nation, which can be changed by roleplay. With this model, we can simulate the economy of nations. If this model is implemented, there will be an overhaul of the structure of the current economy, which will include more calculation processes in the code. There will be much more that can affect the gameplay and mechanics, but to be honest, I don't know how much impact it will have. It will be a huge workload for the admin to code the calculation process, and there will be a grouping of each nation's population. Also, in each population group in each country, they won't have the same constant value of each variable.
VI. The Bonus
In general, a country with more population will benefit from this model as they have more people to contribute to the economy. We can't also skip the geographical advantage that each nation has. The Middle East country will have oil as one of its resources. If a country has more resources than the other, an individual will have a higher direct gathering from the such resource. In a country with high income and living standards. They will have a higher constant value for starting value in each group, meaning they can contribute more to the economy.
VII. The Pros and Cons
As this is my idea, I believe I can think of benefits more than Cons, but we will see it. I believe the Pros and Cons from my perspective can help you decide if this Economy Simulation model will work. The Pros are:
- There will be more benefits from International Trade. If you decide to import oil to your country, your population can contribute to that resource, meaning it can grow your economy. If you export a product, you will have a higher constant value in some variable as it is your surplus and the resource is also in other countries.
- It is a new opportunity for you, as a great country leader, to raise the well-being of your citizens. Do you why you want to do so? Because they can live better and contribute more to the economy! If they have more money, why won't they gift themselves with happiness?
- You can build yourself up into being the economic powerhouse in the world. Also, if you decide to export like a hundred ships into one country, their economy will depend on you. They will cry for your mercy not to put sanctions against them and will follow everything you want them to do. What a great benefit.
- There will be many things to handle by the admin to sustain this model. There is a lot of calculation, and we must do it if we want to stimulate the economy. There will have to be more statistics for a country whether it will be population, resources, average income, and expense, or how much they will pay for each and all resources. There are more, to be honest. We will need detailed statistics for every country.
VII. The Final and Suggestion
I have a few considerations I haven't answered yet, and I want to hear if it is good or what to do with it.
- I think that there can be a national event that can affect variable value. If there is a war, people will spend less or have nothing to spend. We might need to add more calculations to the process.
- This model is a lengthy process to do manually, and we will need to code the application or something that we can put our number into and let it calculate the value. We will have to find how we can practically utilize this model.
This is a very early concept. It only took 4 hours to research and write down the idea. There might be changes to the process, but I would love to hear the feedback as this Economy Simulation model is already huge. I encourage and support everyone to say their view on this suggestion independently, which it will help this suggestion a lot.