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With the changes in the Guild Wars 2 economy connected to the shifts in the economy since the Queen’s Jubilee and the release of ascended crafting, we at Relics of Orr were curious about the direction of the Guild Wars economy and the philosophies and decisions behind the scenes.  We went straight to the source, and were lucky enough to get some answers to our questions!

A huge thank you to ArenaNet, especially Regina Buenaobra, John Smith, and Izzy Cartwright for taking the time to answer our questions!

The Man, the Myth, the Very Humble Legend:

Tell us a little bit about your economics background before joining ArenaNet.
John: I try not to tell boring stories.

How did you end up working at ArenaNet?
John: Through a series of elaborate tests and discussions with Mike O’Brien.

What drew you to working as an embedded economist for a MMO vs. more traditional economist work?
John: I’m a gamer; I always have been. I love games, and I love our game.

How does your job interplay with other roles at ArenaNet?
John: Via graphs… so, so many graphs. Oh and charts… charts, too.

Do you play the in-game markets when you play the game?
John: I play our game and participate in the economy, but I generally do so with a different goal than most. I rarely try to earn wealth, but mostly try to maintain a working idea of how each aspect of the economy is functioning and whether or not it’s doing what I think it should be doing. If it isn’t, am I mistaken or is there an error somewhere? My approach when “playing” the economy is to keep a general map of the health of the economy relative to my goals as an economist, but also in my idea as a player. While I use a lot of tools that are specific to my role, I make sure to participate inside the game as well. I think it’s important as game developers that we maintain a connection with our product from multiple perspectives, and one of those perspectives should always be that of a player.

On Crafting:

How has the influx of gold into the economy from the Queen’s Jubilee been affected by the release of ascended weapon crafting?
John: We keep good track of players’ wealth and the increase or decrease in purchasing power that our players have over time. While Queen’s Jubilee pushed a little harder on the increase of wealth than some of our other releases, we knew that players would have a sink for their new wealth with ascended crafting. This allowed us to transfer the influx of wealth into new crafting and new content and minimize and inflationary effects of the increased money supply. The influx of gold made ascended crafting more accessible to a larger group of people, so I would say it had a positive effect on ascended crafting overall.

How do you see precursor crafting affecting the current precursor market?
John: We are still working on this, but our goal is to not hurt the current precursor market, as it’s a great market for keeping the value of materials in check. This is a tricky goal, and when we are closer to releasing it we’ll talk about it more.

What place do you feel crafting has in the Guild Wars 2 economy?
John: Crafting is an interesting topic because it’s so much different in Guild Wars 2 than in other places. One of the primary differences isn’t actually caused by the crafting mechanics or recipes, but by the global economy. There’s opportunity for profit from crafting all the time, but the economy is so large and efficient that those opportunities tend to go away really fast. Others will pop up to replace them, but it can easily give the feeling of inability to earn a profit with crafting. We recently added some necessary recipes with cooldowns to help crafters easily sell something that’s worth more than the cost of the materials going in. Overall, crafting and the mystic forge both play a huge role in redistributing goods inside the economy as well as adding flavor and fun to the gameplay.

On the Money Market:

How would you compare the way people make money on the trading post in Guild Wars 2 to real world markets?
John: The short answer is: I wouldn’t. I would compare the people. Markets in any major economic system can be hard to understand and predict, and I don’t think this is the medium for a long discussion of virtual and non-virtual economies. However, I think it’s much easier to compare people. While it’s glib to reduce people into individual archetypes, I’ve noticed several types of players in-game that I’ve also noticed as players in real-world financial markets. A good example is the casual investor. In “real life,” this may mean someone who researches their own investment plan or spends their free time studying a specific market for investment. They make fewer but larger trades, and if effective, earn a larger gain than someone who may have not spent the time. This same exact behavior can be seen in Guild Wars 2; the markets are slightly different, but the behavior pattern is the same. In Guild Wars 2 we see a lot of comparable play/personality types that I think have direct corollaries in the real world.

It is often claimed on the forums this or that market is being monopolized does this actually happen? How long can one player or groups of players control one market for?
John: This comes up really often, and so far there’s nobody monopolizing any major market. That is to say, in every major case of market change that we’ve investigated claims of market control, I’ve yet to find any. That doesn’t mean that there aren’t individuals or groups attempting to manipulate and control markets for personal gain – there definitely are. What it means is that any major market in Guild Wars 2 is just too big and has too much velocity for players to maintain any kind of hold on that market for long. The smaller, lower-velocity markets are more susceptible to monopolistic or oligopolistic behavior, but the profit from those ventures is also diminished. Most players with ambition or finances have better ways of earning income.

What sort of market manipulation do you most commonly see?
John: The most common market failure I see is asymmetry of information leading to insider trading. This means that players gain knowledge they shouldn’t have through any of various nefarious means, and use that knowledge to gain an advantage on the standard trader. Overall it’s a negligible, but noticeable, impact that I see every couple of weeks. It’s a secret, but: we have plans, and this will soon become an even worse idea than it currently is.

How do you feel about players being able to sell things for less profit than they would get from selling to a merchant?
John: The vendor value was designed to be a minimum value, which is why we put the restriction on the trading post that doesn’t allow posting for below vendor value. There is still the 15% fee to consider when selling on the TP, but overall I think the current system is good for players.

With the mass influx of gold into the economy with the Queen’s Jubilee patch many players feel that their buying power has increased. How has the natural inflation from such a gold influx actually affected player’s buying power?
John: Players’ purchasing power definitely increased from the Queen’s Jubilee, but I wouldn’t say inflation is a result. It’s really easy to assume that more money to more players equals inflation, but it isn’t really the case. We got to see how well our gold sinks in game really work in the last couple of months and it’s been really interesting. In the end, I think that player’s purchasing power increased from their new wealth, and that this effect was significantly stronger than any inflationary force that may have occurred as an effective of the increase in the money supply.

Legendaries, Rarity, and Bound Gear:

Many of the more prestigious rewards such as legendaries, unique exotics, cultural armor, etc. are tied to players’ in-game and in some extreme cases out-of-game wealth. How do you feel about endgame rewards being so deeply tied to the economy?
Izzy: I think you always want a good mix of prestigious items you can earn with time only, money only, or a mix of both. I think we’ve found that no buyable item will be as prestigious as a time-only one, but we think players should be able to trade money for time and time for money. It’s part of how our economy works, so we are always trying to find good ways to mix reward that require both time and money so players can have the freedom to decide what works best for them.

How did ArenaNet reach the decision that ascended gear should be account-bound?
Izzy: I just mentioned that we like rewards that are balanced between time and money investment – well, exotic gear was almost entirely gated by money, so many players were able to acquire that tier of gear very quickly, which weakened all the rewards in the game. The whole goal of ascended gear as to provide more reward and progression which mean by nature it needed to not be tradable so there’s a time investment. This was also a way to funnel more of the economy and content types into their acquisition.

How are the economics of account/soul/unbound gear items taken into consideration when creating an item?
Izzy: Really, it comes down to the goal of the item. If the goal of the item is to be a great reward, like a rare drop from a dungeon, then you want it to be tradable. If the goal of the item is to be very prestigious, then you want it to be account-bound or soul-bound on acquire. As we create the item we look at the goals of that item and what is it trying to solve, and that normally tells us pretty quick how the item will be bound.

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That’s it for now folks!

Again, a huge thank you to Regina Buenaobra, John Smith, Izzy Cartwright, and anyone else who helped this along for taking the time to answer our questions, as well as all our staff at here Relics for the help in putting this together.