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Saturday, 30 January 2021

Monthly Economic Report - A focus on Sinks

In the last post i looked at the summary inflows and outflows of isk, and then focused on the inflows (faucets).

In this post i want to look at the outflows of isk (sinks).

All the charts comes from my website,  The charts in this post come from the Sinks Charts page

As a reminder, i am talking about how isk leaves the game.  A ship destroyed is not isk leaving the game, buying ammo is not isk leaving the game but paying accounting tax when selling an item is isk leaving the game.

In the prior post we could see that the overall outflow of isk remained towards the higher end of its historical range.

The main sources of sinks

I like to group the isk outflows (sinks) into 5 categories, as shown in the charts above:
  • Merchant related - sales and broking taxes etc
  • Industrial related - manufacturing fees etc
  • Scientist related - research fees, buying BPOs from NPCs etc
  • Player related - skill books bought from NPCs, parallel skill training etc
  • Corporation related - war fees, infrastructure maintenance etc

I will go into each below and address the remaining other sinks.

But the main thing to note is that the economic related categories (Merchant, Industrial, Scientist) are in decline and that must surely reflect declining economic activity.  In other words, a recession.

Merchant sinks

Looking at the Merchant related sinks, which is the area i focus on at the moment to make isk, we can divide this into six individual areas:

Transaction Taxes (top left chart) is the largest (did not used to be), and you can see when the tax rate stepped up in the middle of 2019 though has been in decline since April 2020.  Perhaps seeing some sigh of stabilization now.  This decline more or less coincides with the changes in the Broker Listing fees and introduction of the new market re-list fee.  There is a disincentive to list bulk Sell Orders which therefore reduces the number of items for sale and so reduces overall market activity.

Broker Listing Fees (middle left chart) are the next largest (at times in the past they were the largest) and are back below historic levels.  Now, i don't have the data to know if part of this decline is due to more items being listed at Player stations or if this is otherwise due to less market activity.

Broker re-List Fees (bottom left chart) are the next largest though again also in decline.  I believe all re-List fees go to NPCs (i.e. non to players?) and therefore the decline we are seeing since the month it was fully introduced must surely represent declining market activity.

Hypernet Relay Taxes (top right chart) have held steady once they found a level after the launch of this facility.

Contract Brokers Fees and Contract Sales Taxes (middle and bottom right charts) are broadly flat but are quite small in the big scheme of things.

But, the decline in the Transaction Taxes and Broker Taxes clearly indicates falling market activity despite allowance for orders being placed in Player stations.

Industrial Sinks

Manufacturing Fees (top left chart) has been in decline since (perhaps coincidently) the broker tax changes were introduced though we have also seen changes to industry taxes.  It is tempting to suggest that this indicates declining activity and i suspect it does - the only cloud of uncertainty is the next chart which shows rising Industry Job Taxes.

The other taxes in Manufacturing are much smaller

Industry Job Tax (middle left chart) has been rising over the last few months.  That may indicate that players producing in expensive systems are not moving rather than a rise in activity.

Reprocessing Tax (bottom left chart) is very small.  It is much better to reprocess from a player owned structure.  So to comment on a trend is fraught with data issues - so lets not.

Planetary Interaction taxes (charts on the left) have all been in decline in part due to Player owned custom structures but mostly because of the declining activity and declining prices as this source of income becomes harder for players.

Scientist Sinks

Remains higher than Industrial Sinks overall but much lower than its glory days.

Buying Blueprints from NPCs (top left chart) remains the largest Scientist related sink though has been in decline since April 2020.  Again, i suspect this indicates falling economic activity.

Reaction Fees (middle left chart) remains steady

Researching Material Productivity, Researching Time Productivity and Copying Fees (the remaining charts) are all in decline.  Again, suggesting declining economic activity.

Player Sinks

Parallel Skill Running (top left chart) is where players purchase the ability for a second alt to train skills at the same time as the main alt. Had declined a but but remains popular.  I have not checked to see if a profit can still be made to buy the ability to train skills on a second alt for 30 days and then sell the skill points.

Skill Books purchased from NPCs (middle left chart) continues to decline.  I am a little surprised at that given other charts suggest player activity remains robust.  This may suggest that new players coming through is slowing.

The other charts Repair Bills (bottom left), Bounty Fees (top right), Jump Clone Activation (middle right) and Insurance Premiums (bottom right) are small or, in the case of the insurance premiums, not really worthy of saying much.

Corporate Sinks

These are really low numbers.

Infrastructure Hub Maintenance (top left chart) remains flat

War Fees (middle left chart) has been flat for a long time other than a blip in June 2020

Contract Broker Fee (bottom left chart) is flat.

Corporation Registration Fee (top right chart) is declining so perhaps just less corporations being created

Office Rental Fees (middle right chart) - interestingly increasing, not sure if that indicates relocation to more crowded stations or more corporations renting offices.

Other Sinks

Some items of note here.

Commodity Purchases from NPCs (top left chart) has remained flat

Structure Modules (middle left chart) a new sink for four months has risen strongly in December.  I believe this is the Quantum Cores which are required for all structures.  Existing structures require them in place by 12 January 2021.  So i suspect we are seeing the existing structures being updated in December and likely see some in January also.

Alliance Registration Fee (bottom left chart) has remained flat.

LP Store (top right chart) is arguably declining since the summer and is in the bottom half of its normal range

Asset Safety Recovery (middle right chart) is generally on a rising trend and presumably reflects the trend to move from NPC stations to Player stations or the rise in stations being destroyed (my understanding is that the fee is paid when the Asset Safety is triggered and comes at 0.5% of the assets if retrieved within 5 days or 15% if retrieved after 20 days.

Reprocessing Tax (bottom right chart) . . . . . . . .is double counted, it is already in the Industrial section

Security Processing Fee (top chart), Deployable Fees (middle chart) fell to nil and the remaining Other Sinks (bottom chart) are very small so nothing to say, here for completeness.

Discontinued Sinks

For completeness, i have included the charts on discontinued sinks which were all small numbers anyway:

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