Economic Rules

Before we begin, a quick definition: A simulator is a square as shown in the map. It is, in fact, a physical real-world computer that contains and simulates everything that is being shown on that portion of you inworld map. When you cross a "sim boundary" or "map grid area", your avatar is being transferred from one compter (simulator) to another. Make sense?


ECONOMY and SECOND LIFE - the quick and dirty explanation
by Philip Rosedale and the Second Life team



Intial Allocation and Stipends
-----------------------------
New users start out with around $3500. The amount changes a bit with
the total number of online simulators / users.

Every week, a stipend (think of it as a portion of the overall economic
'pool') is granted to each of the current users. The amount of this
stipend is determined by two things: a base amount (which is the same
for all users), and a bonus amount which is based on your reputation
score. The amount of this bonus can be substantial (much larger than
the base amount) in the case of very high reputations. The exact base
amount varies by the amount of money in the global pool, but is
generally around $1000/Wk/Resident.

Land Cost and Taxes
----------------------
The price of land is initially around $3/square meter, and has a tax
rate of $1/square meter/week to keep. So a typical plot of 16x16
meters would cost $768, and you will be billed $256 a week to keep it.
As the % ownership of land with a region increases (you can see this on
the map as the little green bar in the right lower corner - hover over
it), the cost and tax of land will increase for new purchasers.
However, the tax rate will not change for existing owners (so get in
early!!!).

Object Cost and Taxes
-----------------------
Anytime you create anything in the world (either by dragging from your
inventory or building with the create tool), you are charged $10 per
shape/primitive in the object you build. So for example, a pair of
sunglasses might have 5 primitives and thus cost $50 to bring from your
inventory into the world.

When you delete any object that you own, you are credited back the same
$10/shape creation cost. So it doesn't cost you anything to 'play' -
making objects and then deleting them.

Objects in your inventory are not in the world and are therefore not
taxed. They cost you nothing - you can have as many things in your
inventory as you like.

Any object that you own, anywhere in the world (whether on your land or
not) is taxed on a weekly basis. You can see the owner of an object
when you hover over it - if it belongs to you and is there for a week or
so, you will be taxed for it. As with land, the tax rate changes by the
density of objects in the simulators. Additionally, like land, these
changes (generally increases) do not apply to objects already in the
land. However, they do apply to all newly created objects.

Objects that are lights cost more... the extra weekly tax is show in the
edit panel.

Managing your account
-----------------------

To see a most recent summary of charges, select view->account history
from the menu. You will see a list of most recent charges/stipends, and
at the bottom an estimate of what your charges will be in the next
period. This should be helpful with planning.

Summary - what this means to you
-----------------------------------

Clean up after yourself by deleting 'test' or temporary objects,
regardless of where they are in the world. They will cost you taxes -
even if they are at a friends house.

Keep things you don't want to be paying taxes on in your inventory, not
in the world.

Build things / buy things efficiently - less primitives means lower cost
to create and/or keep things in the world. Building a house out of
toothpicks or having 'real' mullioned windows will impress your friends,
but only because they'll know how much tax you must be paying.

Be mindful of how many lights you use in building - they will cost you
extra taxes.

Don't buy more land than you need, unless you really want to have a big
yard!

Watch the little indicators at the lower right of the map as an
indication of how loaded (and therefore expensive) it will be to buy
land or create objects in the current simulator.

You can check out the charges on your account by selecting view->account
history.

rate me up, then buy my very own sim.
If you own 100% of the land do you get any price breaks?

That's a pretty cool way to do things. dollars equate to processing power.

I read somewhere that heavily scripted objects also cost more upkeep, is there any kind of rule of thumb as to what things will cost more?

1) --------------------
If I make a light object, and the cost of that light object is increased by the volume of the object (ie, a brighter light)

if I use scripting to change the object so that while the sun is up it scales down to a tiny size, then blows back up in the evenings, would that reduce the cost of the object?

2) --------------------
does each object calculate it's upkeep independently? If I create a primitive on tuesday, then I create another on thursday, wednesday is MY pay day. When would I pay for each? On their aniversary or my own?

3) --------------------
Do you calculate cumulative time on an object? If I have an object popping in and out of my inventory on a regular basis when do I pay for it?

4) -------------------
does resetting (through script) the age of an object (resetTime?) change when you pay for it?

5) ------------------
assuming that I pay for stuff on my anniversary If I make an object 5 minutes before midnight am I stung for a full week's upkeep when the day rolls over?

6) ------------------
What about objects in an object's inventory? Do they cost me?

If tax on the object is calculated once a week, it might be worth it to write a script that deletes everything right before, and re-rezes it afterwords. save some $$

I figure if we're in the beta it behooves us to be as openly sneaky as possible.

If I think if a way to exploit the system (And I'm not terribly bright nor terribly sneaky) then you can be sure someone else will.

The difference is I'll tell linden and hope they have a way to fix it.

or you could write a variation on my communications grid idea and have all of your objects transfer themselves into your inventory when you log off or use a voice command. actually that could be cool. I could build the magical growing castle that only appears when I'm online =)

hey bbc, when are you coming back in world I heard something about mid december?

Ian's the best guy to answer highly specific questions about the economic system, since he wrote most of the underlying code. He's out this week (what with Thanksgiving), but I'll poke him on Monday for you guys.

I believe the tax assessor program runs once a day, currently when the grid isn't available. So deleting all your stuff right before payday won't work. Deleting your stuff every night before we shut down the grid might work. But Ian's pretty sneaky too, so I wouldn't make too many assumptions.

James

Answer's to Celerity's great list of questions are below. Sorry for the delay - keep this thread going - I want to get lots of feedback from folks.


1) --------------------
If I make a light object, and the cost of that light object is increased by the volume of the object (ie, a brighter light)

if I use scripting to change the object so that while the sun is up it scales down to a tiny size, then blows back up in the evenings, would that reduce the cost of the object?

A:

You are charged by whatever the assesor finds when it runs. That time is random, so in practice, if you only make lights when you need them, this will be cheaper. That's the idea - to keep folks using lights sparingly. Turning off is a good way of doing this. Remember that you can also turn a light off by setting it's color to black (0,0,0) - we may not be counting this correctly, but I'll make sure that we are.

2) --------------------
does each object calculate it's upkeep independently? If I create a primitive on tuesday, then I create another on thursday, wednesday is MY pay day. When would I pay for each? On their aniversary or my own?

A:

You pay for everything the assesor finds when it runs, for the full period (1 week). This was the only easy way to do it...

3) --------------------
Do you calculate cumulative time on an object? If I have an object popping in and out of my inventory on a regular basis when do I pay for it?

A:

As with the answer to above - assesor bills for what it finds. So popping in/out won't change costs.

4) -------------------
does resetting (through script) the age of an object (resetTime?) change when you pay for it?

A: Nope.

5) ------------------
assuming that I pay for stuff on my anniversary If I make an object 5 minutes before midnight am I stung for a full week's upkeep when the day rolls over?

A: You are indeed stung for a whole week.

6) ------------------
What about objects in an object's inventory? Do they cost me?

A: Stuff in inventory costs you nothing! So keep as much there as you like. BTW, inventory load times will be MUCH faster in next bld.

ok, I like most of the answers here but I have two problems.

I stated in another thread that My chess set creates object, 96 of them at present. So if the assessor runs while they're deployed I'll pay a week's worth of taxes on them.

Do you not forsee that being a disincentive to some kinds of experimentation?
I was considering building a script that I could adapt to the outlands, it surrounds you with a cloud of floating objects that are centered on you as you move, to help deflect incoming.

if it was active when the assessor runs, I'd go bankrupt, so now that's an idea I shouldn't actually think about.

this week:
Stipend +767
Ratings Bonus +613
next week's estimate:
Stipend +454
Ratings Bonus +554
i am not an accounting type, but this certainly caught my attention!

i think the $ pool is shrinking. i believe the taxes are fair and my taxes have not increases noticably because i haven't bought any new land, but the stipend and ratings bonus are shrinking rapidly. it appears that the money pool is getting siphoned off and given to the inactive people. the richest people on the leader board are people i have only seen once or never. if inactive players are paying their subscription fee(in the future, when this is a subscriber based game), then i have no problem with an inactive player gaining money. they paid for it, after all. however, i think most of the active players during beta will be broke by the end of beta.

i'm not suggesting strict adherance to the 5 hrs/week because some weeks are very busy for people, and they may not be able to log in. i am suggesting (during beta) that if a user has not logged in for a couple months, and don't respond after a reasonable time to an inquiry email, that their account and money be recycled.

please correct me if i am misunderstanding the economics. any thoughts?

bp

Yes, this is going to be a problem.

How and why would active players buy items from others if funds are continually decreasing?

How and why would you create sellable items if your funds are continually decreasing and there are few buyers?

If this is a pattern that continues, it would be in my best financial interest not to buy land, which seems counter productive to the community that certain sims exist to promote.

What about those who are prefer building over scripting? They would eventually loose their land and homes?

Geeze, I'd better stop, this doesn't sound too much like a game any more...

Oh one thing more, I think lower object and upload costs would promote more creativity.

fen

hi all - i am officially in the red. negative dollahs. So to save myself from this, I built a store and populated it with my best things. But due to a bad choice of location, no one seemed to find it. So I deleted it. I recouped my $$.

The I deleted my house. Got more $$ back. I thought I was safe, as I figured surely my stipend would be half of what it used to be.

I used to have a rating of 9 and make a stipend of approx 3 or 4k per week. Now i have a rating of 28 and i make about $500 dollars.

I realize that there is less $$ going around due to the huge influx of people, but I can't afford to keep anything in world at this rate.

I don't want to delete godzilla or my silly sea kingdom.
Maybe I'll make 'for sale' signs? I don't want to sell them though.
I would like to start a charity event but as I can't rez anything I feel cheap w/o a theme.

Is there currently any way to dig yourself out of this situation?
Will I eventually lose objects if I remain in the negative balance?
Will Linden Credit Collectors come after me?

To be blunt, I was in a really bad mood this morning cuz I knew I couldn't make a cube. And I know how ridiculous that sounds, but I would like a means of making money thats just as addictive as building. Right now it feels like a job.

My brain says 'trade skill' but i don't believe you all want to go in that direction. I've been banging my head against a wall on this 'issue' for months. I still can't find a reasonable solution to how to make a steady income. Cuz I need at least $5500 a week.
Thats a bucket of dough.

Ah well - sorry bout the rant. Maybe I waited too long to face the music. =P flyk

Hi All,

Thanks for your postings and for letting us know what is happening.

The advantage of having a closed beta program is that we can see what works and what doesn't well before we make a final release. The economic system needs some work or "tuning" as it is called.

So with that in mind, we will continue to refine the economic system so that it works a little more smoothly.

Since we have a good deal of people away with their families, it is not likely that this system will be solved before Jan 3, 2003.

We'll post any changes as soon as possible.

-Peter

The economy in the last three weeks is finally starting to act as a limiting device. I was looking at the leaderboard last night, and I saw that the folks who had come into the beta with a lot of funds, and had been able to maintain large chunks of property for months were no longer able to do so. A week ago I was 2nd in land ownership, 7th in object ownership, in the 70's for $$. All of a sudden, it seems that the established users - steller, bp, flyk, paul, have all sold off land and deleted objects. I am losing about 5k a week, but I have made some back by selling stuff in the Av superstore. Unfortunately, newbs go into that store, and never go back, so if I continue to place new items in there, I have a very limited market.

Flyk mentioned that she had made a store, Last night I built my own. I plan on selling my stuff there, but in order not to fall into the same hole as flyk, I need to advertise, which means I will be making big flashy billboards, and I will have to place them where users will see them, which means the welcome area. I know that the management does not want a lot of junk there, but if I want folks to find my store, but as Flyk found I can't rely on them flying in randomly.

Also, in order to make enough money to keep my admitadly vast estate up, I need to be able to keep customers interested - which means constant new stock. This requires that I will have to spend all my time developing things I think will sell, instead of creating for myself.

Another problem is since everyone is having "tax problems" spending will be down. The only people who will feel they can afford to buy items will be those who did not claim land and build a house. This means I won't be able to sell furniture style items, or scripted house hold devices, only clothing and attachments. Also, I will be competeing with the items sold in the stores built by the profesional modeling/texture artists LindenLab has retained to create a base of inworld content.

Luckily, I have enough cash to last 2 weeks, and the knowledge to make sellable items. However, meny new users don't, and ass they are unable to cope with the economy, they will become frustrated, and we might lose their interest.


this didn't really have a point, I just felt like spewing a few economistic points I had been thinking of.

BBC

When i first started building i had parts fly away and I couldn't find them again (some i did find though (( really far away )...is there a way to find stray parts that may have gotten away from you and are out taxing you?

Valfaroth Grimm

Demon from Below

I'm going to be in the red soon. I've had such a good time making objects, I don't want to get rid of the things I've made just so I can get money back. They ain't great, but they're mine and I have a nice cozy little house!

I bought more land, which I guess I shouldn't have done, but my next major project is going to be my own house, not the preset one. But, as you can imagine...taxes, taxes!

Here's a dilemma I'm facing. I thought I'd try my hand in the consignment shop to sell some of my objects. I planned to put copies in the shop, but as you know, it costs to pull objects from inventory. I found I'd run out of money doing this. Is there a way to prevent this (other than using my originals) when you are trying to sell them?

As has been said, these multipiece objects are going to be the killers. Sigh...

I have a small fix idea for object taxing.

I think this could work with the existing and so far unfair object taxing, and not be so unfair. Have the weekly tax on items reduced to a very minimum, but have something that keeps track of items on a monthly basis. if an item is taxed/in existence for a whole month, (found by the Linden IRS everytime it runs) then it gets a monthly tax that reflects its closer to actual in world existance. Also have some kind of formula for items found in other intervals during the month by the taxer. In other words items only in world once or a few times(experiments) aren't penalized so much. But items found to exist for the sole purpose to just exist that are on all the time are taxed as such.

I agree with the post's on this subject.... I am also going to be in the red soon, and i haven't been in world as much as i would like to be cause no money = no building and i dont want to delete what i already have taken the time to build and put in world.
but the taxman really hurts

We know there is a problem with the current economic situation and we hope to fix it soon.

Once you make something, link it all up, and put it in your inventory. It doesn't cost any money to have items in your inventory, and you can pop it out at any point and time. for example this last week my bill for object creations was $194,320 and my refund for deletes was $194,010. But i still have everything i created, it is just sitting in my inventory.

I already unclaimed a bunch of land, deleted my trading post and all the objects there. Saved most of the stuff to inventory. I'll rebuild it when I become filthy rich ... LOL
I should now be able to stay a float and help out a few people where possible. Special thanks to a few friends, you all know who you are.

And a tip to the new people. Start categorizing your inventory now, when it gets larger its hard to find things. Make sub folders and be descriptive.

Just to add to Steller's most excellent suggestion -- rename things that have the default name of "Object" or "Snapshot" or "New Landmark".

Make LOTS of folders. Categorize things as you accumulate them, or devote 5-10 minutes every single day to the task.

Like your mama probably always said, "if you'd put your toys away after you're finished playing with them, you wouldn't have to spend every Saturday afternoon cleaning your room".

=)

#!

Something that makes it easier to organize your Inventory is to open a second Inventory window.

(Select New Window in the Inventory File menu.)

That way, you can make new folders in one window, and scroll through long lists on the other then drag things from one window to the other to organize.

Oh, bless you! That's a *wonderful* tip!

I take it you're "back" from your vacation/time off? Hope you had a wonderful kissmas =)


#!

The largest expense in my budget is object claim and I don't really understand what that is.

I bought some property a couple of weeks ago which I thought would represent a large one-time expense of "claiming it" and then cost a weekly sum that would be billed as property maintenance.

But every week a large sum is taken that is billed as object claim. This is a separate and substantially larger sum than object maintenance.


Can anyone help me with this?