Yes, it’s that time again! I hope that the mathematical gibberish and interesting graphs in this article will entertain you once again. The subject this time? Well, in the first part of this article, I’ll redo some calculations on construction, and I’ll take a look at the total highscores experience graph of construction. In the second part, I’ll be taking a deeper look into the economic behaviour of rares -- and I’ll do my best to amaze you with a fascinating graph about it.
In retrospect, it seems my first article about the construction money drain was a "bit" too positive about the amount of money drained by construction. However, at the time of writing, I didn’t really have a clue about how many people would continue levelling the skill after the initial popularity of the skill would wear off. That's also why I announced that I’d take another look into the money drained by the skill after it had been around for a few months. Since the skill is now over 3 months old, it's a good time to take a critical look at it again now. The newness factor of the skill is pretty much gone, so we should be able to get a good impression of how much money the skill will continue to drain out of the economy in the future.
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Graph of Total Contruction Experience
Not surprisingly, the graph of the total experience of all players on the construction highscores shows to be a root function (= large growth initially, which slowly becomes less with the time) in the first month. It sounds logical that a new skill is very popular during the first few days after it comes out, then loses players' interest quickly. Eventually, we should expect the graph to start looking more like a linear line (as the interest in levelling the skill will become 'constant'), or actually even a bit like an exponential function (as more and more people are starting to play RuneScape).
As you can see in the graph, the total experience of all people on the construction highscores (about 203K people) combined is 23.2 billion now. During the first 10 days of the skill, players gained roughly 1 billion experience per day on average. Three weeks after that, it dropped to 325 million exp per day, and nowadays it is somewhere around 100 million experience per day -- and it seems to stay around that.
The previous time I assumed that with every construction exp gained, roughly 8gp was drained out of the economy. After some comments about that in the forum thread of the previous article and a few chats with higher levelled constructors, I decided that 10gp drained per exp gained is probably more accurate. This means that construction has drained a total of approximately 232 billion gp so far, and that it will continue to drain roughly 1 billion gp per day in the future.
While this amount is still significant, it is too small to do anything about the huge money production in RuneScape. Compared to my last estimate of a net 6 to 7 billion gp created per day, the 1 billion gp drain per day does nothing more than slightly slow down the massive creation of money. Thus the effect of construction on the future price development of rares, for which the money creation (= inflation) is the most important factor, is minimal.
One of the most common misconceptions about rares is that they continuously go up in price in a steady and consistent manner. This is simply not true. Every now and then rares experience a small price drop or at least price stagnation. Usually this is the result of extreme price increases in the recent history. In turn, such periods of price stagnation or falling prices are generally followed by a period of rising prices. Eventually the prices rise too high, which results in a stagnating rares market again. And so on.
Now a logical question would be whether there is any consistency in the way these events happen? Does the period of prosperity always last a certain amount of time, or does it last 1 month one time, and 6 months the next time? In other words, is there a repetitive pattern, or is it all just random?
To answer this question, I’ve created a graph that shows the average daily price growth in percentages of all rares, in which each rare is equally important in contribution. To ensure that the graph is a bit more robust and to make the interpretation of the graph easier, I used only monthly data to create it. After all, incidental daily price increases of 20 % (such things have happened on several occasions in history) are not useful when you are looking for patterned behaviour.
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Graph of Average
So there you have it. I think anyone will immediately be surprised by how clearly the pattern is evident in the graph. RuneScape’s rares market has the kind of economic behaviour that you read about in (theoretical) Economics textbooks -- in practice, economists are a lot less likely to run into such obvious patterns. And this is not the first time either! If you can still remember from my previous article, I also found out that the rares market seems to follow the (estimated) total amount of gp ingame almost precisely. (Advanced) economics theories and laws seem to be amazingly applicable for something that some people tend to call "just a game".
Do you have any thoughts or comments about what you've just read? Want to discuss this article with your fellow Runescapers? We invite you to discuss the article in this forum topic.