HELM Linkshells and the economy

[Isanov]

I was just wondering (since I have never seen one) if there are any LS dedicated to HELMing. A LS of 20-30 players who have dedicated times they all goto X location, each takes a logging/mining/etc point and they all go at it. Is it done often?

Also how would such an active LS affect the economy? Would it be a bad thing (margins on ingots and such drop) or a good thing (general price of crafted goods goes down)? Thoughts and opinions?

[TenchiHawkwing]

Re: HELM Linkshells and the economy

No clue? I've only taken a high school course on Economics(Hell I didn't even pay attention) so I won't go there.

But I'd been interested in making one; so I'll be watching this thread.

[Matera]

Re: HELM Linkshells and the economy

Sounds like a good idea... If points respawn instantly, that would mean a huge profit for them.

Though you might get likened to a gilseller shell.

[Balfree]

Re: HELM Linkshells and the economy

I wish HELMing was done in such a way that it would be possible for people to do that.

Unfortunatly when theres 5 spawns to feed 20 people... sigh.

I think spawns shouldnt disappear, like fishing you could simply get fatigued after a while.

[Harrison]

Re: HELM Linkshells and the economy

I was just wondering (since I have never seen one) if there are any LS dedicated to HELMing. A LS of 20-30 players who have dedicated times they all goto X location, each takes a logging/mining/etc point and they all go at it. Is it done often?

I believe there are LS's dedicated to what you are talking about, they're called gilsellers, lol.

[Kaliet]

Re: HELM Linkshells and the economy

Although the linkshell wasn't dedicated to it, my old LS would do large group HELM runs. 6 people would cover the zone, and all the drops would be pooled and sold in stacks. We mostly did Jugner and since I had highish wood working I'd break everything down and the leader would sell it all on mules.

It was pretty good gil at the time but if you're not careful can lead to market flooding which kills your profits.

[Isanov]

Re: HELM Linkshells and the economy

I wish HELMing was done in such a way that it would be possible for people to do that.

Unfortunatly when theres 5 spawns to feed 20 people... sigh.

I think spawns shouldnt disappear, like fishing you could simply get fatigued after a while.

I think when one point disappears another forms, and if a member is at every point then it will constantly move from LS member to LS member. I think the LS should be 20-30 because you wont have the whole LS go on every run, since not everyone uses ore/bone/etc nor is everyone online at the same time. Maybe a signup method with alternates should someone not show up.

I dont see why people equate this with gil-selling. Its perfectly legit, especially if there are rules. Say anyone who is a member must use what they take, and check the AH for any members selling ingots/whatever. Granted you cant stop thier mules from doing so, but if they prove they are a decent lvl crafter when joining then they probably wont sell the materiels.

Even should it flood the market with ingots/lumber/etc, is this not a good thing for everyone? General price of crafted items would drop allong with base materiels, thus everybody can buy X item cheaper. Crafters can lvl thier skills cheaper. It hurts those who make profit off of selling ingots/etc, but its not like there are not other decent-margin items for people to profit off of.

One thing to make sure of is to only HELM in moderation. If the LS has a run twice a day then things will collapse for sure. I would say 2 events per week per resource, with maybe 1-2 more per month for difficult areas (read Ifrit's caulderon).

[Balfree]

Re: HELM Linkshells and the economy

Yea i wish its was more common place to do this... if only we were on same servers XD

[TenchiHawkwing]

Re: HELM Linkshells and the economy

Haha, yeah... looks like we're all spread out.
Oh well, it's a pretty sweet idea though.

[kuu]

Re: HELM Linkshells and the economy

Well economy wise, it's split into 2 parts.

Short term and long term.

Something like what you discribe, might be seen sort of like Oil(though not as wide spread).

One one side, you would have one group of people controling supply, and which would most likely depreciate prices.

Now prices going down, is not good, because for every buyer, they'res a seller, and for ever seller they'res a buyer. For a crafting item, like oil, it's 2 or 3 times over(to ship something you need oil, as well, and oil to turn them on etc)

Now if you live in US, you'll know what an Oil can do to a country right now. WHen you have one group producing most of a good that is widespread, the economy depends on it, such that, if they go over demand, it's bad, if they go under demand, it's bad...

Basically if they change anything from the normal it's bad.

This creates a ripple, and no matter how you spin it, short term, everyone will feel it in one form or another. This is something call consumer confidence you hear in the news. If no one can see how much their next week's shihei prices, people will either horde or put off, and create yet more fluctuations.

If it sounds all bad, it's not quite,

Long term it can be advantageous. It also creates economics of scale. That means over all increase in supply, if it can be kept stable. Generally making people happer.

[Isanov]

Re: HELM Linkshells and the economy

To continue the OPEC analogy...

With such a HELM LS (or more than one) achiving a standard supply of, lets say logs, will mean a general price decrease across the board. This means the cost of production goes down (shipping with oil) and more goods are availible for a lower price. It also means that it now becomes more economically feasable for new players to start crafting (new trucking company) which means increased competition. Competition lowers prices further, until a new balance point is created.

Net result is cheaper goods for the masses.

OPEC is a problem because they can dictate the cost of oil and because oil is a limited resource. It would be difficult for any HELM LS to fix prices (unless they create a demand that wont be met without them). Unlike oil, FFXI resources are limitless.

The only ones who get hurt are those players making profit by selling refined resources, and its not like they cannot work on thier crafting (easier with lower-cost resources) or find another of the myriad of profitable items to market.



Esentially, you could look at such a LS as industrialization of the resource market; like the introduction of tractors to farming.

[Kenki]

Re: HELM Linkshells and the economy

Hmm... how HELM-LS affect the economy huh? Well that depends on how much of the big market pie that LS is sharing. The thing about FFXI is that, in the long run (a few months), everyone can enter and exit almost any market at will. Meaning, most markets are quite perfectly competitive in the long run (no ads, no oligopoly, no barrier...etc).

However, if we look a bit further into methods of productions between 5 individuals (5 small independent firms) and a LS with 5 members (1 big oligopoly) in, for example, logging. If you spent some time logging then you will know it's quite time consumming since you have to run around looking for points. 90% of the time you spend is running around looking for a logging point. If you have 5 competitors then you are looking at a very very hard day to log anything useful.

Now in a LS, each member will only take a small area. If one logging point is used up then there will be another logging point appear right after that. This means LS members can cooperate with each other and quickly log as soon as a point appears in their area. So a LS with 5 members will work better than 5 competitive individuals. NO, this is not a cartel-like but it's more of a mass-production system.

Result? Well the LS will produce a lot more than if they were individuals. They have a very very low cost compare to individuals (they don't have to run and look for points anymore) -> supply goes up and price goes down! Simple isn't it?

So how does this fact change your economy? Again, this depends on how much of the market your LS is owning. If the supply is very very large then what the LS can do is to make a very very small change in price. The members will want to sell their stuff faster so they put their price a bit lower than the market price. However, since the market is very large the goods of the members will be quickly absorbed and price returns to normal (note: this is only theory, in practice there are some speculations and delays). If the market is small then your LS can influence the market by 1st driving the price down to kick all of the current suppliers out of the market THEN increase the price since supply fell OR simply sell below the market price since your cost is extremely low (LS practically owns the market now but price is low so you should be happy).

Back to the general question:

Can a HELM drive the price of goods down? Yes, if they are large enough in the market AND is efficient enough in cost term. HOWEVER, a LS might decide NOT to do so but rather drive out the current suppliers (by some ways) and maintain the price so they can enjoy a very large amount of profits. Or they might take those items into other markets (crafts) and simply disperses the effect.

Would a HELM drive the market price? YES and NO, some LS do this to lower the cost of their crafts but most don't. Why? Since members aren't workers, they have flexible times and lots of things to do. Meaning, to gather a bunch of people for a trip will take some planning (this is required to own a large portion of a market) BUT many people find this hard to do. Still LS such as gilsellers LS will likely going to do this since it IS profitable for them to do so.

Evidence for a LS (or LSs) driving the market can be seen before the last gilseller update. Gilsellers LS drived out their competitors using various methods, change the supply and migrate the products to different markets (or simply use them). The result was a reduction in supply of particular items. But the effect is not clear since a large amount of Gil has been put into the economy -> driving demand upwards -> larger price increase. Also there were a large speculation amount the consumers which caused a bubble effect (check stock market).

-----------------------------------------------

Comparing between OPEC oils and HELM LS. Fortunately, most HELM LS can't control the supply. So unlike OPEC they can't drive the price upward. They can reduce the price if they want. This is different from a HNMLS which camp various HNM. These are... quite limited resources similar to oil and a LS 'could' (at least in theory) compete with other suppliers to own the market and drive the price up.

This is just simply an excuse using theory, in practice it is possible to own many of the materials for crafts using a HELM LS (or a very large HELM LS). In theory we expect fair play, in practice we don't. If all the HELM LS camp all of the areas for logging then there is a big chance that individuals who log often will change to other jobs since logging had become so competitive that it's no longer worth logging. Now once the supply side is out, the market belongs to the LS. Assuming they are rational and act like economic agents they will jack up the market price excess goods which can't be sold are somehow converted into other purposes.

[Karinya]

Re: HELM Linkshells and the economy

Their *time* cost would be significantly lower than people doing HELM non-cooperatively, but their *material* cost would be identical. Faster respawning logging points won't make your hatchets break less.

For a big-ticket area like Ifrit's or Newton material cost is pretty insignificant anyway, but if you're doing this in Jugner... that fast rate of logging is going to burn a lot of hatchets fast.

Then, of course, you have to dispose of the logs to free up inventory space before you can do it again. Having a woodworker in the LS would help a lot here, though - I don't think you would have too hard a time getting some crafters to join, given the flood of materials you're going to provide them with. :D

This approach would be especially helpful in places like Giddeus where the area design forces you to do a lot of backtracking and running through places that don't even have any HELM points.

In some areas, including Giddeus, not all parts of the zone are equally valuable - so there may be some disagreement about who gets to sit in the 5-mining-point patch and who has to go sit on the 2. Unless you pool all proceeds at the end of the session - then you get to divide 7 (or 3!) adaman ores by 4 people.


As for the large scale economic effects - I doubt there would be much from any one LS. It's a big economy. Since their material costs are the same (and they might throw away some of the lower-value stuff to keep their inventory space available, too), I'm not sure they would even lower their prices compared to other HELMers - most likely any individual member would only do one or two runs a week, and spend the rest of the week selling/crafting their loot.

[Matera]

Re: HELM Linkshells and the economy

Sounds interesting. I think I'll do this with a couple friends.

[kuu]

Re: HELM Linkshells and the economy

To continue the OPEC analogy...

With such a HELM LS (or more than one) achiving a standard supply of, lets say logs, will mean a general price decrease across the board. This means the cost of production goes down (shipping with oil) and more goods are availible for a lower price. It also means that it now becomes more economically feasable for new players to start crafting (new trucking company) which means increased competition. Competition lowers prices further, until a new balance point is created.

Net result is cheaper goods for the masses.

OPEC is a problem because they can dictate the cost of oil and because oil is a limited resource. It would be difficult for any HELM LS to fix prices (unless they create a demand that wont be met without them). Unlike oil, FFXI resources are limitless.

The only ones who get hurt are those players making profit by selling refined resources, and its not like they cannot work on thier crafting (easier with lower-cost resources) or find another of the myriad of profitable items to market.



Esentially, you could look at such a LS as industrialization of the resource market; like the introduction of tractors to farming.

True and not. TO continue with oil. While it is hard to control/find a new oil rich area, it is also true, that even if someone tries to compete/take place of old HELM, prices will shift as per oportunity cost forumla.

If a HELM quits, smaller old school people competiting can't meet supply@cost of the old establish company.

Anytimes a market leader changes directions/ can't meet expectations, the economy flutuations i.e $3 per gallion gas.

This is what happened to OPEC. Short term, they can't increase production no matter what the government puts on them. Long terms, it'll stablize, but as they say, we can all be dead before the long term comes(figuratively speaking).

If dell and all the other companies were to suddenly leave, I could step in and do what they do, but without economics of scale on my hand, I would be force to raise prices a hundred folds, due to demand it has created.

Barrier to entry is only half the issue, economics of scale is this method's good side. No one can do it more efficiently alone.