## Tuesday, July 15, 2008

### Prices

So.

We have numbers for where goods and services are, and we have a method for how to get translate that into numbers. And we have a system for the distribution of those articles. Any questions so far?

Let’s move on, and see about how to work out the price of an actual item. This is going to get fairly complicated, so get out a pen and paper and follow along. In this case, showing the work is de rigueur.

Thankfully, I don’t have to work through this process every time. I have it on excel, with each formula automatically translating the numbers; but I’ll go through it here, so it can be understood how its done. Sadly, my price table is behind my source table, the one I posted yesterday, as I spent last week adding France. Therefore, these numbers will not fit; that doesn’t matter. I’m not in the mood to update my price table at the moment, which will take three or four days…I’m working on other things. It is the SYSTEM that matters, not the numbers.

(You wouldn’t be using these numbers anyway—you’ll be using the numbers generated by your world).

The numbers apply to Kronstadt, where I believe I’ve mentioned the party is near. The importance of the town is that it occupies a gap in the Transylvanian Alps, as a gateway between the Great Hungarian Plain and the Black Sea.

Total Iron references (at the time of the making of this table) are 319. Of this, Kronstadt imports 6.565. You’ll remember that this is the product of various market zones all feeding into Kronstadt depending on how far away they are.

The 6.565 is computed against total world production, and we find that Kronstadt has access to 1,622,076 stone (16 lb.) of iron ore (metal equivalent). This is worth 13,727 ounces gold; translating this into copper pieces per stone (64 c.p. per g.p., plus 2 grams gold content per g.p. which means 15.55 g.p./ounce of gold…remaining coin content is typically copper) gives us 8.42 c.p. per stone.

To this, I apply a travel modifier divided by 1% of the world’s total; Kronstadt’s comparative availability is 2.1% of the world’s total…that means the 8.42 c.p. is divided by 2.1, giving us a cost of 4.09 c.p. per stone of metal content for unprocessed iron ore.

Okay. Pig iron:

The smelting references for Kronstadt are those for smelting in general and for smelting specifically iron ore, which adds up to 4.743. (From this point on we ignore the world’s totals…those only apply to the raw materials). The base price for smelted iron (pig iron) equals (ore price)/4.743+(ore price). In other words, the greater the number of references available to Kronstadt, the lower the service cost of transforming it into pig iron; a reference of “1.0” would exactly double the cost.

Thus we have (4.09)/4.743+(4.09) = 5.0 c.p. per stone. However, it requires 5.67 stone of coal and 0.72 lbs of limestone added to the blast furnace to make one stone of pig iron. The cost two raw substances is also worked out, and in total they add 64.8 c.p. to the final cost…giving us a final total of 69.8 c.p. per stone of pig iron.

Wrought Iron:

So far, all we have is puddled metal…it is not even as far as it needs to be for it to be smithed. It has to be mixed with other metals…specifically manganese and nickel. There are hundreds of wrought iron combinations; I use one I found in the old encyclopedia, which is common enough for use here: 93% pig iron, 6% manganese and 1% nickel. 0.93 pounds of iron costs 4.1 c.p.; 0.06 lbs. of manganese is 1.2 c.p., and 0.01 lbs. nickel is 0.9 c.p. This is 6.1 c.p. total for the raw materials.

The availability at Kronstadt for metallurgy, or the making of alloys, is 1.806 references. Once again, 6.1/1.806+6.1 gives an adjusted price of 9.5 c.p. per pound of wrought iron. Now we can move on to smithing.

Ironmongery:

The availability of iron smithing in Kronstadt is quite high; Transylvania was famous for its metal working, which was part of the reason it was able to oppose the invasion of the Ottomans for so long. Even as Hungary fell in the 1500s, Transylvania continued as a “client-kingdom” of the Ottomans, enjoying soveriegnty in their own country in trade for the occasional force of men and the much needed metal goods it was able to provide the much, much larger empire.

Transylvania’s references for ironmongery is 3.72. Applying this to the price of wrought iron (9.5/3.72+9.5) gives us the quite reasonable price of 12.1 c.p. per pound.

This can now be translated into actual goods. Of course, the party could, if it wished, buy bars of wrought iron. At 9.5 c.p. per lb., a 20 lb. bar of iron would be a mere 170 c.p., or less than 3 g.p. Of course, if a first level party broke into a smithy and found a stack of 400 such bars, it would make a tidy little treasure. Moving it, on the other hand, might be interesting…but a smart little adventurer might figure that out, and just how high a level can a blacksmith be?

Well, I’d estimate fifth level. But if a thief snuck up behind him at just the right moment…

But I digress.

Lets take a very simple piece of ironmongery: a catapult ball. For a small catapult, my sources tell me this would weigh 57 lbs. All we need do is multiply the catapult ball’s weight against our known cost for ironmongery, giving us 689 c.p., or 11 g.p.

Of course, not all ironmongery is built equally. Some things are harder to fashion than others: for different things I assign a level of workmanship. I try to keep the numbers low…twice as hard, three times as hard and so on. An anvil might be 1.5 times more difficult to craft than a catapult ball; a door, being nothing more than a poured square with a hole for the handle, 1.75 times. A cauldron, which must be balanced, 2 times. A chain, 4 times. And so on.

Here is a list of the ironmongery items I’ve added to my equipment list:

This is not exhaustive, by any stretch of the imagination. I’m sure there are things missing. But to get the price for those things, I do not have to pull one out of my ass. I can judge its workmanship by other items on the table, determine its weight and there you are. Plus the comparison between the objects makes sense.

The above list, you'll also notice, contains no tools...that is the next tier, in which tools are more expensive than ordinary iron objects.

And if the party moves to a place where iron doesn’t happen to be common…say the Guinea Coast of Africa, the reference numbers go down and the costs go up. Or the reverse, say in Alsace-Lorraine in France—where every party ought to go to buy their weapons.

Does this help fill some of the holes in how my trade works?

1. I'm getting the larger picture here, but I have to admit I'm lost in the details of it all. This section made sense to me, as I can readily understand how you are deriving your prices based on the availability of goods and services at a given location. However, I have a question and a sub-question.

Total Iron References = 319 does that mean that there are 319 iron producers in the world? Also, your Sources spreadsheet shows 708 Iron references for all documented places (=sum(J2:J1240) on Ores-Min worksheet), so is this 319 a regional number, or have I completely missed the boat?

Numbers for locations of goods and services: Check. I understand how you derived these numbers and what they mean...I think. I'm going to re-read your early posts and see if any new lights come on in my head.

Method for translating those location numbers into new numbers: I'm unclear, but I'm going to go back and read your previous posts. My confusion comes from the translating a set of numbers into a new set of numbers - I don't get why you're doing that, so I'm going to try and clarify it for myself.

System for distribution: I get this, but I feel like I skimmed your trade model and didn't fully-comprehend. I'll re-read Haulage and comment under that post, if necessary. You mentioned that your trade model was really simple, so maybe this time it will sink in.

By the way, Rapidshare is...adequate. I got the file, so Hooray! There seem to be some missing spreadsheets -- would you mind posting about them and what they do at some point? Your tools are fascinating to me.

2. Carl,

About the total iron references being 319 in my explanation and 708 on the sources table. I did explain that the numbers I’m working with to determine my prices are OLD numbers, whereas the sources table are the newest numbers.

You see, it takes time to examine each section of the world, gather the references from the hundreds of encyclopedia articles, organize them, and then add them to the sources table I posted. Recently, I added France and Italy. That is a lot of references. I haven’t added those references to my pricing, yet, because there is always a lag. I will be doing that in the next few months.

Don’t confuse “iron producers” with “references.” A reference refers to the total value of all the world’s iron, not the number of people who might be exploiting it, or even the number of locations. The source table you have shows several places that have multiple references.

“System for distribution: I get this, but I feel like I skimmed your trade model and didn't fully-comprehend…”

Yes, I said it was simple; but large numbers of distribution points can slow down the method. If you have a look at the number of locations where iron is produced; each of those is divided by the distance from Kronstadt…adding a tiny bit from here and a tiny bit from there, giving me precise numbers like “6.565.”

One of the tables I haven’t posted is a “distance table,” which includes the distance of all trading cities (found on the commerce tab) between each other. I am presently reworking this table…gigantic headache that it is. The distances are compared with the sources table, producing the specific reference totals for each location. So the numbers are not merely “translated.” Is that clearer?

3. It's getting clearer.

I've re-read all of your econ posts again and made notes and done some test calculations in the process this time, so I feel like I'm getting closer to seeing the meta-system now.

Regarding iron producers and references, is a reference an amount of iron, to be determined by the total amount of iron produced in the world divided by the total number of references to iron production? After re-reading your Values post, I came to this stunning conclusion. I'm slow, but not being very bright makes up for it.

References are metadata for Commodoties, Products and Services.

For example, you could have 100 iron mines, and represent two of them producing 50% of all the iron in the world by distributing references more heavily to those two mines. I think.

Moving on.

In paragraph 10 or so, you state,
To this, I apply a travel modifier divided by 1% of the world’s total; Kronstadt’s comparative availability is 2.1% of the world’s total. I have questions on two things here.

1) 1% of the World's Total what? Total Iron ore produced in one year? I'm pretty sure this is it, but I wanted to clarify, and if so then why 1%? Is this the percentage of iron references held by this city?

2) How is the travel modifier calculated? Is this taken from the Haulage formula? Does every city have a travel modifier, and can a city have more than one?

The data entities I've been able to derive so far are Cities, Commodities, Services, and Products. Cities contain Population, and can contain Banks and Markets. Commodities, Products and Services contain References, Demand and Availability. Services can be combined with Commodities and/or Products to make additional Products.

I'm going to see about upgrading my home computer to Office Vista and start working with your spreadsheet to get some numbers into a SQL database, where I can start applying these principles to a test world.

Thanks again for posting this stuff. It's some of the most interesting RPG material I've read.