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Do you believe in teh invisible hand fo the free market?
Ihmotepp
Member Posts: 14,495
Do you believe in the invisible hand fo teh free market?
"the term economists use to describe the self-regulating nature of the marketplace."
It basically means, if there are not enough apples, the price for apples will go up. Farmers will see that the market is paying a high price for apples, so they will grow more apples to satisfy the demand. If they grow to many apples, then the price will go down, until they can't make a profit selling apples.
Then, farmers will quit growing apples. In which case the price will go up...
So with competition and market forces, eventually you reach an equilibrum where apples are being priced at what people can afford, and what makes farmers a profit.
The market will decide how many apples get grown, adn what price people will pay for them.
Does this apply to MMORPGs? Are people complaining about the developers, when really it's just the market determining what gets produced? Have developers really figured out what MMROPG players are willing to pay for, and they are already providing it?
In that case, what the market wants is F2P games, and WoW. Plus a few other P2P games, but not many.
Or do you think it's so much harder to make a good MMORPG than grow an apple, that the market is not able to respond quickly to the demand? That there is a market for something besides WoW and F2P games, but developers havent' figured out how to make it yet?
Comments
The free market only works if you have enough people selling those apples.
With MMOs you can choose now between Wow, something close to Wow, Eve or a really low budget and badly coded indie game.
The free market have always needed people with new ideas. The MMO genre is controlled by a few companies like EA and activision and they have no interest in lowering the prices or making better games as long as their competitors doesn't do it first.
Free market works fine to a certain degree but it often ends with a few mega corps that sells more or less the same products for exactly the same price, just look on oil companies.
Not that monopoly works any better of course, that is even worse.
There is no such invisible hand. The hand is very visible and active, and there you have corporations controlling markets, sometimes critical ones like food or medicine and not caring about people dying like insects (from hunger or curable diseases) as long as their profit margin goes up.
The invisible hand is academic bullshit, there is no thing like that.
There is no free market, good markets need rules, good rules can not be invisible.
No balance is stable, only imbalance is stable, the more imbalance the more stability.
(Even balance can be changed by the weight of a feather falling down on one side of the scale, if one side weights 1000 pound and the other weight 1 pound nothing will change ever - you have stability.)
"Torquemada... do not implore him for compassion. Torquemada... do not beg him for forgiveness. Torquemada... do not ask him for mercy. Let's face it, you can't Torquemada anything!"
MWO Music Video - What does the Mech say: http://www.youtube.com/watch?v=FF6HYNqCDLI
Johnny Cash - The Man Comes Around: https://www.youtube.com/watch?v=Y0x2iwK0BKM
The mega corp thing is the eventual end result of a free market. Unless you manage the market, making it not free, you'll always end up with an individual or group that is just better than everyone else in the market. In the U.S. the final, final result is that those mega corporations cement their position at the top against new competition using the legal system, not the merits of their products to do so.
I think the MMO market is much closer to a 'free' market than most others. The competitors aren't competing using the legal system, they are competing based on the merits of their products. Blizzard got in early, and cleaned up, but it won't last forever. So long as Blizzard is unable to use means other than the merits of their product to compete, eventually something or someone else will come along and the market will shift.
I can not remember winning or losing a single debate on the internet.
A little knowledge is dangerous.
Many people try to use the theories of Pure Competition irl. There are no true examples of it in real life. The closest things would be something like gravel, sand, salt, etc. MMO's being very clearly an oligopoly or monopolisitc. There are huge barriers to entry and exit, few competitors, and the products couldn't be farther from standardized.
Sent me an email if you want me to mail you some pizza rolls.
With MMO kits like Big World and Hero Engine, scores of game studios, hundreds of MMOs on the market, a subscription fee that's been almost unchanged for near a decade, and a standard set of maybe four primary platforms ( primary, not total) to choose from it's amusing to see your first sentence and your last sentence in the same post.
There isn't a "right" or "wrong" way to play, if you want to use a screwdriver to put nails into wood, have at it, simply don't complain when the guy next to you with the hammer is doing it much better and easier. - Allein
"Graphics are often supplied by Engines that (some) MMORPG's are built in" - Spuffyre
Free market does not work with things like music , movies, games , art and things like that.
All things like that are more or less unique.
We would have free market if f.e. Blizzard would not distbute Wow itself but . f.e. sold WoW license to few companies and then those companies had right to offer WoW to consumers separately , using diffrent prices , business models ,etc
So while free market may work when it is about selling and buying potatoes , then when it is games , hmm there is certain competition but not as direct and good as with many other things , since you DON'T have same things you can buy in the other place if you dont liek the service.
Well anyway , only way imho which I realized is to try to control your own desires. I started to do that recently and I am feeling better actually. IF I won't like something (like TSW P2P+IS model) I will resign from buying and using this game.
I would actually prefer to buy it through some other dealer that would offer me TSW as pure P2P (even as higher sub rate) , but since that does not apply in games, movies and art department I will have to learn to pass on things.
I like to be in control of myself and not justyfying to myself that It is okay to cope with any idiotic business practices that are thrown at me , just becasuse I would like something.
WTH does Adam Smith's concept have to do with MMOs?
First, the invisible hand does not preclude collusion, corruption, and down right human stupidity (if you knew the biography of Adam Smith, you would know he didn't assume as such). It merely means that given all possible choices, market actors will inevitably choose what works best for the factors of production.
Second, MMOs are expensive to make because of non-market forces like so-called intellectual property and various regulations on videogames in other parts of the world (the US is not the whole planet). That's why you have many game companies creating their own in-house software stack. If IP law wasn't so onerous, it's likely there would be many more developers making MMOs.
Third, what you like or prefer is not objective. I hate to break your heart, but good or preferable depend on your subjective valuation. What I like is certainly not what you like. So, don't expect developers to pull out a powder blue turban and try to read your damn mind. At best, they'll try to respond to failures of not meeting your demands, however vague they may be, but they're not guaranteed to come up with exactly what you want in any case. This is key above all things because the invisible hand says nothing regarding innovation or entrepreneurship (if you even had read some of the work of Frank Knight on the matter, you would know this), that's a subject entirely alien to economics.
Holy crap, that post rocked.
There isn't a "right" or "wrong" way to play, if you want to use a screwdriver to put nails into wood, have at it, simply don't complain when the guy next to you with the hammer is doing it much better and easier. - Allein
"Graphics are often supplied by Engines that (some) MMORPG's are built in" - Spuffyre
Sigh. God I hate the dumbness that marxism has created. The "invisible hand" was coined by Adam Smith.
The genesis of this phrase (which pre dates laissez faire which was coined by french economists not the British Adam Smith and to some extent Hume) was as a response to mercantilism. Not "regulation". Its an argument that humans naturally become more efficient and prosperous when left up to a market. Versus Mercantilism which believed that large government (often autocracies at the time) driven control of foreign trade.
Mercantilism was a driving force of colonial expansion and various other aspects. "Laissez Faire" was coined by french merchants when asked what the autocratic beauacracy could do to make them able to make more money. Their response was "Let it be" or "laissez faire".
These concepts tell you nothing about whether you will be satisfied or that they will create the best product. It was merely coined as a generalized philosophic formulation of why letting the merchants do their own thing resulted in more prosperity than having supposedly smart and prosperous people dictate entire countries economic directions.
Will you hear and see some current day people advocate that markets are "self regulating". Sure but they are just as full of shit as all these insane Keynesian who think they are "progressive" by adhering to an economic phlisophy that failed 90 years ago. How one can continue to think one is progressive by utilizing a century old non-working model is beyond me.
Markets are not inherently moral or immoral. They will not necessarily result in the ideally "best" quality product. If the idealy best product cost 4 times what a really good product and the consumers are not willing to pay that extra price then quite simply that ideal product will fail.
A market will give you what the consumers feel meets their needs the "best" according to their buying decisions. It does not necessarily result in the highest quality product.
People have complex reasons for buying things. Part of the the ground breaking work of Adam Smith and others is exploring the consequences of this without trying to tackle what exactly these buying decisions are.
If everyone was evil and they just really want to buy things that inherently do harm to others and they value that highly then that will be part of the their buying decision and the market will produce evil consequences. But even then you still have the issue of price. No buying decision is a single factor. Its at least two factors and usually far more.
You can't reliably say anything about what a market will produce product except that it is fairly decently meeting people's price versus value estimate. But value is where the buying decision becomes very very sticky.
The issue of what value is should be obvious to most people; its extremely erratic in the MMO market. People will give highly different answer as to what is the realative worth of features.
As for the idea that the MMO market suffers from a high degree of a "Barrier to Entry" maybe that is true for the guys who aim to be "WoW Killers" but there are tons of MMO games out there so it simply cannot be true overall.
Yes, the market is self regulating but not to the benefit of the consumer. With so many large corporations holding all the capital its up to them what happens and if they could they would screw out the customers they rely on. Look at how bad America's "broadband" network is compared to other developed countries. Its up to the governement to ensure the corporations play nice.
Clearly the demand for games like WOW has produced more games like WOW.
However when all the farmers rush to make apples after seeing apples are a popular food, they won't necessarily be as good at farming them. Especially when we're talking about products where the producers have a *lot* of control over quality. No surprise when other farmers barely scratch the market because even the best farmer can't quite reproduce the quality of the best farmer's work.
"What is truly revealing is his implication that believing something to be true is the same as it being true. [continue]" -John Oliver
Really? Look at it from a business perspective, then start commenting on such. Trends, public relations data, habbits, and sales words, styles, eye candy all effect the market. Whoever has the sexiest, cheapest, well advertised game wins the money. Those that don't suffer. Plain and simple, don't make this complex guys. Know your target, know what audience will play your game. Why do people say you can't control the market? You can certainly control how people percieve your game in the market. That's control, and if you study trends, chaos theory, and know who you are selling games to, you can ultimately control how and when people will buy your games. In short, you can maximize profits, minimize waste, all through conduct the BASICS of general business.
In today's society, less than 2% actually understand good business, and sadly less than 2% control most of the money. Enjoy blaming things on stuff you can't control, when ultimately you can control almost everything about the product you are selling. I leave with this simple word, solve the majority of people's game problems cheaply for a fps, rpg, or rts and watch as the sales and money roll in.
I struggle not with life, money, emotions, and world, but against old mindsets and selves to be proven obsolete in a age and time of rapid changes. Go create fun, so you can have fun.
No. As I believe the case to be in all things, there needs to be a balance between total control and total anarchy.
People don't ask questions to get answers - they ask questions to show how smart they are. - Dogbert
wishful thinking. brand name still counts a lot in games
Look at Blizzard, StarCraft 2 was basically a tremendous dissapointment, D3 looks like plain white collar robbery, so few they have worked and improved on it, its basically paying the full price again for a game that you already owned 12 years ago...plus pay to win...
SC2 sold like hotcakes, D3 will most likely break all records.
I don't think so. Most of the companies like own the MMOs used to make good games themselves once but or now either living on past successes or on buying up companies.
Both EA and Activision used to make great games (now we are talking C-64 and Amiga times) but now they are living on buying up other companies and then sets up direction for what for them to do.
The MMO market are controlled by a few giants like EA, Activision and NC soft, the only smaller independent company I know of that have any impact on the market is CCP right now.
It is partly our fault as well, we players often buy a game on old merits of the company. If we just bought the good games because they were good things would look different. I cqan promise you that Titan will sell millions no matter if it sucks badly or are great because Blizzard made it.
And we seen quite a few lawsuits in the MMO market. Blizzard have sued people for using "craft" in their name. Atari and Hasbro have been fighting over D&D, Interplay and Zenimax/Bethesda have been fighting over the rights to a Fallout MMO, Trion and Palladium have fought about the name "Rifts" and so on.
And the reason noone sued eachother for stealing UI and mechanics is because both of those were invented by a small indie company for Meridian 59, all the large companies have stolen them themselves.
The invisble hand has to deal with the cost of living. So, sometimes price ceilings, price floors come into action with subsizadation because the demand is not high enough, or the competition is too strong etc etc. So supply and demand can help a person to maximize thier profit but any business has to deal with the cost of running thier businss and making a living off of it as well.
Write bad things that are done to you in sand, but write the good things that happen to you on a piece of marble
Economics deals with looking at certain models to simplify the equation.
If you consider human corruption a part of any eqaution to debunk something, then something as simple as lying would make a democracy not work. So it does exist, but it rarely happens, or it should rarely happen when looking at the model.
I also dont understand why you say economics does not deal with innovation or entreprenuers? There are substitutes to regular products and that would be similar to that idea and how new products affect the market. Also new technology shift, or innovation will shift supply, and affect the supply and demand curve to offer more compeitive prices. Is that there something else?
Write bad things that are done to you in sand, but write the good things that happen to you on a piece of marble
WoW and LotRO are two of the top played computer games (not just mmorpgs) on the market. WoW's an established brand with a loyal customer base, LotRO took on an ala carte pricing method that appeals to penny pinching MMO players. Plus it had a good rep and player base to begin with.
Yeah.
Some economic rules that were made up in the 80s, made it into text books in the 90s, sadly executed in the 00s, are now affecting the 10s.
But that little nugget stays true.
I used to play MMOs like you, but then I took an arrow to the knee.
the invisible hand of the free market is NOT what most people here seem to think it is.
it is the idea that an individual, acting purely out of self interest, will make choices that have a positive impact on the economy as a whole. Under this theory developers make MMO games because people want them, and will pay money for them. The developer is acting in its self interest by providing you with a game that you will pay them for (in some way). Games in the past used a lot of grind mechanics to keep people playing longer thus paying subs longer.
More recently, games have become less of a grind. Is it for the gamer that developers are doing this? Not according to the invisible hand, which says that the developer does this because a more profitable business model is the cash shop. Players have, in general, declared that they like cash shops except in cases where the cash shop is required to play the game. Therefore, we can assume that developers will make more games that use a cash shop model because it serves their own interests.
On the player side of things, gamers play the games they want to play because it is in their own interest to have more fun.
Now, what players want in terms of more WoW like games or less WoW like games is NOT PART OF THIS, for the primary reason is that factors other than game types are usually at play when players choose what games they play (such as quality, or amount of fun they have whil playing that game). There is also the idea of risk avoidence on both the producing side and the consuming side which inhibits change in the MMO market place. Smaller games have less risk to producers, so they change a lot faster than the big budget games. Players have limited amount of time to play games (time is our most valuable resource after all) and have to make decisions to either play a game we know we will have fun playing or to spend our time with a game that might not be fun.
If players really DID want WoW clone games, games would be advertised as beign like WoW. Rift for example was "a fresh new world" for WoW players to try out. They even used the "We're not in Azeroth anymore" ad here on this site. They were trying to differentiate themselves with WoW, even if they share many similarities.
I think thats about it.
I used to TL;DR, but then I took a bullet point to the footnote.
Both EA and Activision used to make great games (now we are talking C-64 and Amiga times) but now they are living on buying up other companies and then sets up direction for what for them to do.
The MMO market are controlled by a few giants like EA, Activision and NC soft, the only smaller independent company I know of that have any impact on the market is CCP right now.
It is partly our fault as well, we players often buy a game on old merits of the company. If we just bought the good games because they were good things would look different. I cqan promise you that Titan will sell millions no matter if it sucks badly or are great because Blizzard made it.
And we seen quite a few lawsuits in the MMO market. Blizzard have sued people for using "craft" in their name. Atari and Hasbro have been fighting over D&D, Interplay and Zenimax/Bethesda have been fighting over the rights to a Fallout MMO, Trion and Palladium have fought about the name "Rifts" and so on.
And the reason noone sued eachother for stealing UI and mechanics is because both of those were invented by a small indie company for Meridian 59, all the large companies have stolen them themselves.
Blizzard isn't trying to prevent the Fallout MMO from reaching the market. Similarly, Funcom and ArenaNet are not using legal means to prevent or increase the cost of their respective products. As much as is possible, mmorpg compete with each other on the merits of each mmorpg.
If another company wants to enter the mmorpg market and compete, they have to produce a decent product. That's it. They don't need a crack legal team (yet) and they don't need a huge marketing arm in their company (though it helps).
This is as close to an actual free market as we're ever going to see. I'm sure at some point legal shenanigans will enter into it and we, the gamers, will suffer for it. But until then competition is good and it will improve the quality of the games we play.
I can not remember winning or losing a single debate on the internet.
The term was first used by Adam Smith. It means that in a truely healthy market, meaning a market that has only a large number of small participants without any market domination, on both sides (producers and consumers), the market will overall have a tendency to find the correct prices for goods without any further outer regulation.
This is a fact.
The first problem about this is, how longterm said tendency is. For example, in a market that is very dynamic, prices may vary wildly every day. This is what we see in MMO economies - there is nobody able to gain a monopoly (unless you are "first crafter class" on a server, and even that is only very temporary), but demand and offer might change very fast in short time, especially if the game is currently failing, or if there was a new expansion and a lot of new players start playing, and so on.
And the second problem is: what happends when the participants gain market domination. The most powerful kind of market domination is the monopoly. In a market where the producer has the monopoly, they can basically ask any price they want.
A good example for this is Microsoft. Their concurrence, like Linux (NetBSD, OpenBSD, ...) offer their product FOR FREE, but still it stands no chance against the monopolist who asks high prices for his product - which is also obviously inferior in its abilities, except for gaming, and the later only because hardware producers offer Windows drivers with their products, but not Unix drivers, and game developers do not offer Linux / *BSD versions of their games. Microsoft did not even gain their position on the operation system market because of a superior product, just by misusing its market power in the first place and by profitting from the position of Intel, the biggest player on the computer chip market.
Other examples of monopoly misuse include how the india trade company, in the "good old days" of india being a colony of the UK, destroyed rice while there was a famine going on. The reason was simply to maximize profit. Thats how murderous monopolys can be.
So yeah, the invisible hand exists, but believing in the invisible hand and being dogmatic about "market solves all" is two completely different things. What we see right now is the result of classic laissez faire ideology - a fanatic ideology that teaches "if its free market, it will correct itself".
That is NOT what Adam Smith said and that is NOT what happends in reality. In reality, more and more producers usually gain more and more market power and will start to dictate prices and maximize their profits.