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Interview with ArenaNet Economist John Smith and Lead Designer Izzy Cartwright


Arenanet's economist John Smith and lead designer Izzy Cartwright gave an interview to the relics of orr website regarding recent shifts in Guild Wars 2's economics, and the influence of crafting and patches on the in-game economy.

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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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#1 davadude

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Posted 23 November 2013 - 08:18 PM

Thanks Azure.  Gonna hijack your post and front page it!
Davadude - Guru Village Idiot

#2 Azure Skye

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Posted 23 November 2013 - 09:22 PM

View Postdavadude, on 23 November 2013 - 08:18 PM, said:

Thanks Azure.  Gonna hijack your post and front page it!
I've seen it floating around reddit but i didn't see it posted here and it raises a couple of questions and answers a bit at the same time. =)

#3 Alex Dimitri

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Posted 23 November 2013 - 10:18 PM

Hmmm....giving answers without really giving any is a Master Trait !

But then there is some inconsistent stuff, if you look something by rarity legendary weapons should be bound on creation (or at least account bound) right ? Hardest to make very costly, lot`s of mats.....rarest......but they aren`t !
Ascended gear mentioned, ok more ways to get, easier overall...laurels, guild commendations, WvW badges....this makes perfect sense.
But Ascended weapons on other hand forces people to level up crafting, cost arm and a leg.....and get account bound ?
What if :

1. I don`t like crafting  (my case)
2.I want to make gold trough crafting (not waste it)
3.I have gold and i just want to buy the best weapon in game (make somebody else earn gold)
4.Or maybe i will pray to gods of Tyria for a drop..... (yeah right :P)

Anyway i honestly believe they are makin` this up along the way, this cannot be the best possible way !

#4 StormDragonZ

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Posted 23 November 2013 - 10:46 PM

John sounds like the kind of person who walked from Rata Sum to the entrance of the Citadel of Flame just because it would cost too much to waypoint.

Izzy sounds like the kind of person who doesn't know where the Ring of Fire Islands are on a map, and everything is either black or white, no exceptions.

If I didn't already know about these two guys already, I'd say they both are completely disillusioned to what really happens in the game.

#5 typographie

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Posted 23 November 2013 - 11:10 PM

View PostStormDragonZ, on 23 November 2013 - 10:46 PM, said:

Izzy sounds like the kind of person who doesn't know where the Ring of Fire Islands are on a map,

Maybe I'm being naive, but I don't see anything in this interview even remotely related to lore or game geography. Where exactly are you getting that idea?

#6 StormDragonZ

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Posted 24 November 2013 - 01:58 AM

View Posttypographie, on 23 November 2013 - 11:10 PM, said:

Maybe I'm being naive, but I don't see anything in this interview even remotely related to lore or game geography. Where exactly are you getting that idea?

That he doesn't have an iota of an idea of what exactly EXISTS in the game, and if he does, he couldn't be bothered with remembering it.

#7 NerfHerder

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Posted 24 November 2013 - 02:42 AM

From a working man's perspective, I dont think they are doing a bad job on the economy. No object in game is unattainable to me, it would require alot of work, but nothing impossible. If you have played since launch, casually, you can easily have your main in all the ascended available right now. Or if your an altoholic like me you can have 8-10 toons in all exotic with at least ascended amulets from daily laurels alone. And being 5-8% behind the power curve aint bad, for someone who needs the variety of alts. Just keep Izzy away from the nerf bat, my monk is still bitter.

#8 Mordakai

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Posted 24 November 2013 - 04:42 AM

View PostNerfHerder, on 24 November 2013 - 02:42 AM, said:

From a working man's perspective, I dont think they are doing a bad job on the economy. No object in game is unattainable to me, it would require alot of work, but nothing impossible. If you have played since launch, casually, you can easily have your main in all the ascended available right now. Or if your an altoholic like me you can have 8-10 toons in all exotic with at least ascended amulets from daily laurels alone. And being 5-8% behind the power curve aint bad, for someone who needs the variety of alts. Just keep Izzy away from the nerf bat, my monk is still bitter.

Nothing?  Not even a Legendary?

#9 Azure Skye

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Posted 24 November 2013 - 05:14 AM

View PostMordakai, on 24 November 2013 - 04:42 AM, said:

Nothing?  Not even a Legendary?
The cheapest precursor weapon on the market is Venom which makes Legendary Kraitkin. =P  

Some of ours priorities are just different then everyone else's. I'm with NerfHereder, i'm just making long term goals then being short sighted with legendaries. That is how i didn't get burnt out in GW1 is making long term goals to do until i did everything i wanted to do and left to play another game.

#10 UnDeadFun

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Posted 24 November 2013 - 10:39 AM

I like GW1 and I do like some things about GW2, so I'm not here just to bash or complain. However I have to agree with Alex and Storm. Unfortunately I believe they don't know what they are doing and just keep making things up as they go. Not all my links refer to economy but they also did have an impact on the economy.

1st character to 80 in 32 hours - used crafting with leveling
http://www.reddit.co...rfeuze_and_war/

1st legendary (mats prep'd - temple bugged)  
http://www.guildwars...40#entry1960755

over a year later temples still bugged - even for anet
http://www.guildwars...es-due-to-bugs/

#11 pumpkin pie

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Posted 24 November 2013 - 03:39 PM

Quote

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.


Highly Suspect! What do you think the economy should be doing?

#12 Eon Lilu

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Posted 24 November 2013 - 06:25 PM

Gw2's economy has already been described by many players and media as one of the worst ever in the history of MMO's, this guy is part of the reason why, that pretty much sums up the gw2 economy.

#13 Alex Dimitri

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Posted 24 November 2013 - 06:50 PM

Yup, economy is far from good and they keep adding wrong moves. Look at it this way you can buy any Legendary weapon but cannot tier under, strange i don`t see any logic behind it !
Specially if you take in consideration that crafting both legendary and ascended weapons is nothing more than plain and simple money sink !

Today i bounced weaponsmith to lvl 500 i prepared everything for GS all im missing right now is 100+ dragonite ore, and entire process didn`t evolved anything but simple paying stuff. I even bought some stuff of TP just to avoid crafting as much as i can.
Money sink no achievement with crap load of mats i still spend well above 100 gold, it`s not that i`m crying cause gold is gone, nah i just played so many games that give you chance to make some on crafting if your up to it, GW2 doesn`t come close to this category !

#14 Reason on Cooldown

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Posted 24 November 2013 - 06:51 PM

The biggest problem I have with account bound ascended is that it prevents you from helping out a friend.  If I max weaponsmithing and my friend maxes huntsman, we can make ascended weapons for each other.  We BOTH have to max it.  And I think that hurts the social aspect of crafting, and makes it a purely selfish pursuit.  Sure they made the time-gated mats tradable to maintain the crafting economy.  But that only applies when you're not crafting for yourself.

I always thought they should as some toilet recipes to make ascended that used the same mats as teh crafting recipes, but MORE of them to offset the work in crafting to 500.  But I guess if the intention was to make a purely time dependent path to ascended that wouldn't work.  But I have to believe a solution exists that maintains both the time dependent aspect, but doesn't devolve leveling crafting to a purely selfish pursuit.

View PostStormDragonZ, on 23 November 2013 - 10:46 PM, said:

John sounds like the kind of person who walked from Rata Sum to the entrance of the Citadel of Flame just because it would cost too much to waypoint.

Hey that sounds fun.  I'll have to try that some time!  Of course you're speaking to the person who one day decided to ride the main road(s) from Booty Bay to Sunstrider Isle in World of Warcraft just to see how long it took. :)

#15 HELLruler

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Posted 25 November 2013 - 11:37 AM

So this game has economist :o

Jokes aside, I'd like to see the runes dropped from dungeons not being SOULBOUND anymore. Cmon, they should be at least account-bound

#16 El Duderino

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Posted 25 November 2013 - 12:04 PM

Any talk of the in game economy is kind of a joke. Most of the high end stuff or desirable stuff in the game can't even be traded and therefore has no effect on the economy. If they were able to traded, we would see how poorly these things affect the economy and it would be blatantly worse.

#17 Featherman

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Posted 25 November 2013 - 07:41 PM

View PostEon Lilu, on 24 November 2013 - 06:25 PM, said:

Gw2's economy has already been described by many players and media as one of the worst ever in the history of MMO's, this guy is part of the reason why, that pretty much sums up the gw2 economy.
Well, it's accessible but not entirely, deep, engaging or interesting when compared to, say, WoW or EVE. A lot of it has to deal with the item and loot system. Such is the nature of the carrot on the stick approach they've taken with the game. They way ANet ninja nerfs the drop rates really that it's economy run by ANet and patronized by the players.

#18 nerfandderf

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Posted 25 November 2013 - 07:49 PM

what I wished they would really do is clamp down on the insider trading. Buying things just before the patch and then re selling them after the patch - after huge demand has gone up due to one reason or another.

That has happened so many times that they allow people with a little knowledge to exploit it for their own ends just isnt right.
They should be named and shamed.

And as above -John isnt nice and proved that - he should also be made to go back to school.
Izzy shoudlnt be allowed near the game.

Good on getting the interview tho Azure.

#19 MazingerZ

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Posted 25 November 2013 - 07:50 PM

View PostFeatherman, on 25 November 2013 - 07:41 PM, said:

Well, it's accessible but not entirely, deep, engaging or interesting when compared to, say, WoW or EVE. A lot of it has to deal with the item and loot system. Such is the nature of the carrot on the stick approach they've taken with the game. They way ANet ninja nerfs the drop rates really that it's economy run by ANet and patronized by the players.

When the rate at which your fake money system affects your ability to accrue real money, yeah, not interested.
It's okay to enjoy crap if you're willing to admit it's crap.
Every patch is like ArenaNet walking out onto the stage of the International Don't Kitten Up Championship, and then proceeding to shiv itself in the stomach 30 times while screaming "IT'S FOR YOUR OWN GOOD! IT'S FOR YOUR OWN GOOD!"

#20 El Duderino

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Posted 25 November 2013 - 07:56 PM

View PostFeatherman, on 25 November 2013 - 07:41 PM, said:

Well, it's accessible but not entirely, deep, engaging or interesting when compared to, say, WoW or EVE. A lot of it has to deal with the item and loot system. Such is the nature of the carrot on the stick approach they've taken with the game. They way ANet ninja nerfs the drop rates really that it's economy run by ANet and patronized by the players.

At the other end of the spectrum is ascended trinkets that, if trade-able, would be laughably inexpensive because of the frequency with which they drop for FoTM players - to the point where they sell them to merchants because there is no need for them. So, one of the most highly prized BiS gear in the game would be worth next to nothing if released on the market.

All these things are indicative of a poorly designed game in regards to economy. And, it is no wonder, when one realizes, as you mention, that the game is designed by increasing playtime though carrot-on-the-stick design rather than adding content that is inherently fun and repeatable.