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Wednesday, 29 October 2014

Is there Inflation in Eve Online? Yes, of sorts.

The economic lecture at the May 2014 Fanfest would suggest there is no inflation in Eve Online.

The lecture, which can be viewed below, starts with the question of inflation from the beginning.





The data seems conclusive that outside of Plex there is no inflation in Eve.

However, there is a further point to consider - and this may square the circle as to why the player base (or at least many of the blogs i read) say there is inflation but the data says there is not.

This point is: as more of the game opens up to the player base either because the player base gets more skill points on average or CCP adds patches that allow players access to more and more equipment then the amount of ISK required to maintain a similar relative standard of living in Eve is going up.

Think about what you spent in your first 3 months in Eve vs your most recent 3 months in Eve - for sure, you will be spending more today to keep up with the demands of the game.

Furthermore, as ships specialise etc and more addons come about - we all seem to have additional ships / mods for this and that - again, we are spending more ISK to keep up with the demands of the game.

Whilst technically not inflation, there is an ongoing increase in the ISK required to play the game.

Another angle on the whole Plex debate.


7 comments:

  1. Yeah...but that is not anyway at all inflation. Like not just 'not technically', it is not inflation.

    Valid point in general but your initial premos is misleading.

    Its the equivalent of buying an aeroplane and a palace and complaining that you suffer from inflation because your standard of living has become more afluent.

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    Replies
    1. Yes, I know. But I suspect to most playing Eve they see their required ISK spend rising and deem that to be "inflation". As you point out, it is not the definition of inflation.

      It is perhaps more like operating in a business that is seeing rising regulatory costs (power generation, for example) and so the cost of staying in that business is rising.

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  2. Quite so, the ultimate currency in a video game is player time and that is buying more than it used to (and is worth more).

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  3. Economic inflation - a general increase in prices over time, there's none really in Eve.
    Monetary inflation - an increase in the amount of money in the economy, there's plenty of that in Eve

    When players talk about inflation they usually mean economic inflation, the price of goods.

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  4. When Plex was created it became the defacto Reserve currency of eve replacing ISK as the dominate currency. If you rework your prices in terms of PLEX and accept that PLEX itself is the measure of "living standards" in EVE then yes we have and are experiencing inflation in EVE (both economic and monetary). An analogy would be Oil priced in dollars (US$ reserve currency for the worlds most essential good, plex is a combo as a currency and good) Even if the price of food in Europe remains at exactly the same Nominal Price this year as last, if the exchange of dollars to euros appreciates then the "price" of Food just experienced inflation relative to dollars/oil. No numbers other than the exchange rate had to change to create the effect of inflation

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  5. I think you're describing the superior good effect.

    RE Inflation: Wasn't there something in the CSM minutes about the new manufacturing and team costs having a deflationary effect and that they were considering adding new isk sources to off set it?

    We should set up a CPI basket for eve so we can measure this stuff.

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    Replies
    1. Essentially PLEX is a measure of who has to play by paying currency directly and who gets to play by paying with time/in-game effort. The exchange of PLEX to ISK is the market mediating this relationship. I would argue that PLEX, not ISK, is the true measure of value in eve.

      Absent PLEX in Eve everyone would be making their decisions based solely on how much ISK they needed to accomplish in-game goals. They would subscribe and let accounts relapsed based on out of game personal economic factors which would then determine the scope of their in-game ambitions.

      With PLEX in the game, a large segment of the players now have an additional economic factor that can drive their decision making and it quickly becomes the dominant factor since it directly ties to those RL personal factors. What player in the game doesn't imagine that buying PLEX in order to play the game "for free" would be better than paying currency. The current RL economic conditions in the US/EURO/JPN are abysmal for large segments of society ... bargain seeking behavior is the operational factor.

      What we are seeing in EVE is that more players want to save their currency and play for PLEX ---- this is almost certainly driven by out-of-game economics and not in-game economics. More demand for PLEX is driven by players wanting to save money and pay with "time" and therefore the in-game market is reflecting that fact.

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