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Tuesday, 11 October 2016

Citadel Trade - some thoughts on what it might be.

I have been taking a look at some of the stats we get from the Eve Economic reports which can be found in the Dev Blog.

There are two stats that interest me because they look odd - and both suggest that Trade is being under reported in the Economic Reports:

For what it is worth, i suspect Trade in Citadels is either 292.544 Trillion ISK in September (=37.9% of all Trade) or 117.310 Trillion ISK (=20% of all Trade).

1) Transaction Tax Rate: If i take the total Transaction Tax in September of 7.713 trillion ISK and compare it to the total Trade in September of 479,205 Trillion ISK then it appears that the average Transaction Tax rate is 1.61% (i.e. 7.713 / 479,205).

That is odd, it should be nearer 1.00%.  Indeed, back in February, March and April the Transaction Tax Rate was 1.00% using the same calculation.  I.e. the vast majority of Trading is done by characters with Skills that reduce their Tax rate to the minimum level.

But in May this rate rose to 1.31%, June 1.42%, July 1.50%, August 1.51% and September 1.61%.

Hence, either the Transaction Tax i am looking it as too much (unlikely) or the Trade value i am looking at is too small (possible).

I am suspecting that we are not seeing all the Trade.  Indeed, it is noteworthy that the divergence from 1.00% started with Citadels were introduced.

Hence, i suspect the Trade we get from the Economic Reports does not include Citadels.

If i assumed the Transaction Tax rate should be essentially 1.00% then i can deduce what the trade in Citadels is.  The Table below does exactly that (all numbers in billions):

Column 1 "Stated Trade" shows the Trade value in each month taken from the Economic Reports.  Column 2 "Stated Transaction Tax" shows the Transaction Tax each month taken from the Economic Reports.  Hence, column 3 shows the Transaction Tax rate - and you can see how it rises above 1.00% once Citadels are introduced.

So, column 4 assumes that the tax rate should be 1.00% and therefore column 5 derives the new Total trade in Eve by dividing column 4 into column 2. And so column 6 then shows what the Trade in Citadels should be (i.e. the derived Total Trade less the Stated Trade).

Stated Transaction Assumed Derived Derived
Stated Transaction Tax Tax Total Citadel
Trade Tax Rate Rate Trade Trade
Feb 977,077 -9,817 1.00% 1.00% 977,077 0
Mar 842,974 -8,336 0.99% 0.99% 842,974 0
Apr 849,840 -8,493 1.00% 1.00% 849,840 0
May 734,239 -9,596 1.31% 1.00% 960,200 225,960
Jun 566,864 -8,068 1.42% 1.00% 807,289 240,425
Jul 514,299 -7,708 1.50% 1.00% 771,246 256,947
Aug 496,178 -7,506 1.51% 1.00% 751,086 254,909
Sep 479,205 -7,713 1.61% 1.00% 771,749 292,544

What is interesting is that if this is correct then in September the 292,544 trillion ISK of trade i believe is Citadels represents 37.9% of Total Trade in Eve.

2) ISK Volume: In the monthly economic report downloads provided there is a spreadsheet that shows the daily ISK Volume.  Now, i suspect the ISK Volume is measured via the market trades.  If i take the monthly ISK Volumes then they indeed compare rather well to the Trade values in February, March and April but then start to pull ahead in May onwards - again just when Citadels were launched.

The table below (all numbers in billions) shows the "ISK Volume" per month taken from the Economic Reports and compares it to the Trade per month also taken from the economic reports.  They look very similar for Feb - Apr and then diverge.

ISK Stated
Volume Trade Difference
Feb 977,156 977,077 79
Mar 843,028 842,974 54
Apr 849,886 849,840 47
May 743,030 734,239 8,791
Jun 623,940 566,864 57,077
Jul 594,832 514,299 80,533
Aug 581,670 496,178 85,492
Sep 596,514 479,205 117,310

Now, if i was to assume that the "Difference" is in fact Trade being done in Citadels then in September i could say that 117.310 Trillion ISK of trade was done in Citadels vs 479.205 Trillion ISK done in traditional stations.

In other words, Citadel trading would represent 20% of all Trade done in Eve.

Different answers?  Or actually the same?

However, the "Transaction Rate Tax" method seems to give a different answer to the "ISK Volume" method.  Either i am saying Citadel Trade was 292.544 Trillion ISK in September or i am saying Citadel Trade was 117.310 Trillion ISK in September.  Or, of course, i could be wrong on both methods.

What is interesting though is if i look at the Transaction Tax Rate assuming the "ISK Volume" is the Total Trade in Eve.  i.e. column 2 in the first table divided by column 1 in the second table.

ISK Transaction Tax
Volume Tax Rate
Feb 977,156 -9,817 1.00%
Mar 843,028 -8,336 0.99%
Apr 849,886 -8,493 1.00%
May 743,030 -9,596 1.29%
Jun 623,940 -8,068 1.29%
Jul 594,832 -7,708 1.30%
Aug 581,670 -7,506 1.29%
Sep 596,514 -7,713 1.29%

For Feb - Apr i get 1.00% effective rate (as expected) whereas May - Sep i get the same 1.29% effective tax rate each month.  Now, that is too much of a coincidence!  I can't explain why this is the case - but there has to be a reason why the monthly Transaction Tax divided by the monthly ISK Volume is now equal to 1.29% for each of the last five months.

1 comment:

  1. That's a great analysis! That would explain why we see the trade volume decreasing every month since summer.

    I myself trade in 5 regions, but apart from high value items, I don't see many other sell orders for stuff in that regions. I wonder where all this citadel tradeing is actually happening.