Welcome back after the brief hiatus! Just a reminder that, going forward, there will only be one update each week. Eventually I would like to return to the one every 4 days schedule that I was using, but that will be a ways away.
So today I’m continuing my talk on fictional economics. On April 18, I shared a post that challenged you to think up new types of currency rather than relying on the old standard of metal coins. Today I want to talk about what sort of things your characters might buy (or sell) using their chips, marks, stones, or other currency.
Now, if you’ve already done a bit of world building, you might have some idea of what type of goods the country or area produces. In my experience, this generally means that you’ve thought about how people eat and/or make clothes. You know they grow X, Y, and Z crops, they have M, N, and Q livestock, and can hunt and/or fish for D and F. Crops X and livestock Q are used for making cloth rather than food, and there we go.
While this is obviously important, it isn’t the whole picture. A country with that sort of set-up would not be self-sufficient. They would need to produce extra of everything so they could sell it to bring in things like lumber, stone, metal and/or metal ore, gems, different types of fabric, spices, etc. A driving force of human history seems to be the desire for “more”, regardless of how much one already has. Which means that while, yes, your country can survive on what you’ve thought of, the people living there would want some of what other countries/areas have.
This is a good point to remind you of what Dr. Philip Swicegood said; “Economics is about exchange and incentives.”
So you need to think about, not only what goods are produced, manufactured, and consumed within a country, but also what goods are made in excess to sell, and what goods are brought in from other sources. Now, this isn’t as simple as “Country A has more bacon than it uses, so it’s going to sell it to Country B. Country B has more marble than it needs so it’s going to sell it to Country A.”
As neat as that sounds, it isn’t very realistic.
Unless there are literally only two countries in your world, there is going to be competition between countries that want whatever good is being sold. So Country A, C, and H all want/need marble, but Country H is willing to pay more directly. So Country B sells the majority of their marble to Country H, and splits the remainder between A and C. The consumers in Country H now have easy access to marble and likely pay a reasonable price. Meanwhile, the consumers in country A and C pay a premium price for the marble because it is a limited commodity in their countries. And even that is very simplified.
Then you need to take into account religious, political, and other tensions between countries. Perhaps Country A recently regained its independence from Country B. If that independence is the result of a war, then A and B are probably not on the best of terms. Any trade happening between countries may be impacted (artificial inflation of cost, restriction on goods bought and/or sold, delays of shipments at borders, tariffs, etc.). Similarly, countries that have ideological differences may impose restrictions as a method of showing their displeasure. It could even be a scenario of enemy-of-my-friend, where A and B don’t get along, so C doesn’t trade with A because they have a long-standing alliance with B.
I suggest making a trade map where you can mark who has an alliance with who, where the tensions are, and then mark the flow of goods.
I’d also like to point out, that sometimes a good is sold off, and then bought back after it’s been processed or modified in some way. A very simple example might be selling ivory and then buying carved ivory jewellery. So don’t assume that just because one country produces a product that they aren’t buying some form of that product from elsewhere (even if they technically make enough).
Once you’ve figured out what’s made locally, nationally, and internationally, you can get an idea of what an average marketplace is going to look like.
A big city will likely have a little bit of everything, even (or especially) items that are restricted in the amount that the country can buy. Whereas a small town will probably only have locally made items with a few high-demand imports. This will also be impacted by how easily travel is within a country, and how close a small town is to a large centre that has rarer items.
Now you also need to think about how much these items are going to cost, and how much income people from various walks of life make. A country where farmers are required to tithe a certain amount of their produce to a church and/or the government is going to have less money than one where farmers are simply required to pay a monetary tax on the amount of produce they sell. (Of course, there could be exceptions if it’s a small tithe compared to exorbitant taxes)
While I’ve been saying that a country buys the goods, its really merchants within a country. And a merchant won’t buy product they don’t think they can sell. So if the common folk are poor, richer items are not going to be a common occurrence at the market. More likely that they will be brought in on special order (and at higher prices) for the wealthy. While a strongly wealthy upper class can, on the surface, run a vibrant buy-sell market, it requires the middle and lower class to make a truly stable economy. The wealthy only need so many items, and because they have money the items tend to be higher quality and need replacing less often. The middle and lower class are the ones who are going to be repeat buyers much more than the upper.
Which is why you need to consider all of these points when trying to develop a fictional economy.
Do you think I missed anything? Did I over-simplify or make an errors? Then let me know.