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Treatise on Economy of RS

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Deltaslug

Deltaslug

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Author notes:

1) This is not a focus on the player driven market via the Grand Exchange. Instead this focuses more on the currencies within Runescape.

2) As no canonical names have been given, the term [unit] is used.

3) This may end up more as fan-fic than lore unless the Jmod Lore Council states otherwise.

Introduction

The economy of the world is a living organism unto itself. Bound together by the spirit of trade between the kingdoms.

Economics has been present on Gielinor for ages. Many of the basic principles introduced in the Second Age are still used today.

In modern times, the kingdoms have signed numerous trade agreements and standards for banking to allow for a harmonious flow of goods and services. Some kingdoms such as the Dwarves, Gnomes, and Elves have rejoined the greater trade community in recent years and have agreed to follow the terms of these treaties. Newer kingdoms, such as the Cave Goblins, have also agreed to use the international standards. There are far flung settlements in the Wilderness and Morytania that use the international Gold Standard seemingly out of tradition than anything else. Interestingly, stories abound of the kingdoms of Zanaris, Morytania, and even in far flung planes of existence observing the Gold Standard more out of convenience than anything else.

14-May-2018 04:11:19 - Last edited on 21-Jul-2018 05:19:43 by Deltaslug

Deltaslug

Deltaslug

Posts: 28,797Sapphire Posts by user Forum Profile RuneMetrics Profile
Local Economies

Sadly, some regions use their own local currencies. Tokkul (for the Tzhaar), Trading Sticks (in Tai Bwo Wannai), Chimes (Wushanko Isles), and Ecto-tokens (in Port Phasmatys) for example.

There is some logic to this as these regions are fairly remote and not fully integrated into the larger economy.

Some places, such as Port Phasmatys, do use hybrid economies, where gold coins are accepted for some goods. But many unique goods and services require the use of the local currency.

In some cases, the locals may be using the currency out of tradition, stubbornness, or to protect their own market. An exchange rate can be worked out by figuring the value of the local currency against the cost in Gold for any given item. But this does tend to hinder larger scale business activities.

Others, such as the Vampyres of Darkmeyer, trade blood. This is not only used as a form of currency, but also sustenance. The value of the blood can increase either due to the rarity of the type, or the unique conditions the subject was exposed to before the blood was removed.

Gold Pieces

The most basic currency used throughout all of the kingdoms. The physical description is simple: round, composed of [redacted] percent gold and [redacted] alloys. Commonly used for the most basic transactions throughout the lands for common goods and services.

Until recent years, many kingdoms minted their coins with a unique design. But all kingdoms accept the coins as is. "Money makes the world go round" as some say. Why should 1 gold coin be treated any differently than another?

14-May-2018 04:11:48 - Last edited on 30-Aug-2018 03:55:57 by Deltaslug

Deltaslug

Deltaslug

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The Effects of Alchemy

Wizards long ago created a spell called Alchemy, in both a "low" and "high" form. For laymen: they use magical energy to turn one item into gold coins. "Low" gives a small amount of gold. "High" gives a larger amount of gold.

Some time ago, the Wizards, in conjunction with the leaders and economists of the lands, created a value of all items when converted to gold coins. All items do have a finite limit that they can be alchemized into, but it took years of negotiations to set the prices.

In modern times, only higher authorities have the ability to change the alchemy prices. (In theory), this is only done out of necessity when facing major changes in the overall economy.

Interesting note: There may be an awareness to the Alchemy spells as rumors abound of the coins knowing which kingdom you are in and creating the coins with the markings of that specific kingdom.

One of the more interesting secrets of the 5th Age comes from the Wizard's Tower.

Long ago, the kingdoms were worried about wizards/mages casting Alchemy so much, that it would flood the economy with coins. After the destruction of the Tower, the Wizards assured the courts that this would not be an issue.

Looking back, it seems the Wizards had a de facto reason for not being able to do this as they lost the ability to craft more Nature Runes until the late 5th Age, and thus could not train enough Wizards to be skilled enough to cast Alchemy. Instead, reserving the runes for the most skilled students or for dire need.

14-May-2018 04:12:03

Deltaslug

Deltaslug

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The Gold and Silver Bars

Formerly, the next step above Gold Pieces/Coins in terms of value, their usage in the modern economy has gone down.

Long ago, the number of mines that could extract ores was limited, and the number of smiths that could smelt bars was tightly regulated. This allowed kingdoms to keep control over the number of bars in circulation.

With their value tied to their High Alchemy value, kingdoms had some control over them.

As time passed, more mines were located ... and so too did the number of individuals and organizations that were creating bars.

The kingdoms gradually lost control of the market value of the bars.

Several influential Seers informed the courts that in the future, there would be a major update to how the economy exchanged. Taking heed, the kingdoms began to slowly divest their stocks of Gold and Silver Bars to the global banking system, and begin the creation of a newer unit of gold standard.

Influential individuals in the business community with strong ties to court advisors eventually convinced the kingdoms to deregulate the Gold and Silver supplies. On the surface, this seemed to have created a great boon for the economy as a whole. When the Grand Exchange was created (for a better history, the reader may want to discuss this directly with one Brugsen Bursen), the market price of the metals fluctuated heavily. Today, it appears that speculators who pulled out from the market early fared better than those who still held onto the metals.

Today, Gold and Silver Bars are still traded, and have value. But most kingdoms only give them out more for their traditional or symbolic value. Often preferring to sell them to artisans when commissioning new jewelry or ornamental objects for state.

14-May-2018 04:12:21

Deltaslug

Deltaslug

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New Units of Standard

In the mid-5th Age, the kingdoms worked with the Wizard's Tower and artisans to create a new type of Gold Standard. This bar would be difficult for anyone else to create without magical means as it would have a higher percentage of gold purity and other valuable [redacted] alloys included. These bars were often used not only by kingdoms, but also large businesses and certain wealthy individuals.

Wizards also added basic spells to allow for tracing the bars, thus making them more difficult to steal. These bars were also marked with serial numbers to allow for greater accountability for the history of the bars.

Today, few of these [units] are in circulation. Some can be seen by the public in the Varrock East Bank vault. Records indicate that many of the bars have been lost to theft or shipwrecks.

Some indicate the bars in possession of Khans of the Wushanko Isles. Other bars are merely listed as "stolen", likely due to the thieves hiding them under areas with protective wards. (If the thieves are dead, then it is possible that the bars may never be retrieved.)

Other bars were lost when the ships they were on sank. Rumors abound of a Fremennik named Olaf who has a map to a number of shipwrecks. If the scrying spells are accurate, the map could help to pinpoint the locations even further.

Some bars were still in the bank on what was colloquially called "Tutorial Island".

The largest percentage of bars however were lost around the island of Crandor. History remembers when a dragon awoke on the island and laid waste to everything in sight. A number of trading ships, laden with bars were lost off the coast.

Salvaging the bars from these locations is dangerous, at best, as the magical or mechanic means to attempt salvage operations are still experimental.

Provisions within the trade treaties already discuss the protocols for bringing these bars back into circulation.

14-May-2018 04:13:01

Deltaslug

Deltaslug

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Modern [units]

After the fall of Crandor, and the loss of so many bars of [units], a new standard was required.

Taking the lessons learned from the creation, and losses, of the previous standard, these bars are larger, with a higher purity of Gold than ever before. The Wizards added new enchantments to help protect the bars. New accounting methods and policies for record keeping were enacted to track them.

These [units] are used almost exclusively by the governments of kingdoms for trade purposes.

Note: For those seeking a better understanding of this, Duke Horacio gave an excellent introduction to the basic use of the [units] during the economical impact of The Battle of Lumbridge.

It should also be noted that it is rare for anyone outside of a royal court or the banking industry to lay eyes on one of these bars.

14-May-2018 04:13:18

Deltaslug

Deltaslug

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The Highest Currency in the Land

The highest [unit] of gold is also one of the most carefully guarded. Few of these bars exist in circulation. The vaults they rest in are some of the most well protected, which only a kingdom could afford, let alone a private citizen.

The creation of one of these bars is a closely guarded secret as well, but does require the attention of artisans and wizards over a span of days to make just 1 bar.

The value of 1 [unit] could easily buy a fully decked out throne room in the home of a private citizen.

Interestingly, kingdoms hold onto these bars, much the same way some private citizens horde Gold Pieces. While the average citizen might think the kingdom would use one of the [units] in a time of dire emergency, such as hiring a mercenary army in time of war or paying to rebuild a city ... the truth is most kingdoms use them as collateral for loans from the banks. The banks know the relative value of the bar, and thus allow the kingdoms to borrow gold at a percent ownership of a bar (or in some cases, taking possession of a full bar) until the loan is fully repaid.

14-May-2018 04:13:36 - Last edited on 21-Jul-2018 05:25:52 by Deltaslug

Deltaslug

Deltaslug

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The Risk of Inflation and the 'Adventurer Tax'

In recent years, the economy has seen a rather terrifying pair of influences:

- the rediscovery of Runecrafting

- the rise in the number of adventurers at an unprecedented rate

The banks of Gielinor report the highest number of Gold Pieces in circulation than at any other time in history. Rampant inflation has been held off due to the combined factors of only a handful of items seeing prices skyrocket and the number of adventurers holding onto large piles of coins, yet not spending them.

In response, the kingdoms instituted a rather ingenious system of taxation: the "Adventurer Tax".

While the kingdoms have yet to institute anything on the free market influenced by the Grand Exchange, many of the businesses and services in the land, and somehow even Death was convinced, to raise prices whenever an adventurer visits their shop. Many adventurers complain of such high prices, but seem to accept it as status quo as many others suffer the same prices, or they are the only ones to rely on said services.

The stores do keep a small percentage of the tax, but the rest are taken by the kingdoms, often destroyed if no other use can be found for the material.

The kingdoms, and higher powers, continue to create new and inventive ways to encourage these adventurers to discard more and more of their Gold Pieces and prevent them from entering the larger market.

14-May-2018 04:14:02

Maniaces
Oct Member 2019

Maniaces

Posts: 336Silver Posts by user Forum Profile RuneMetrics Profile
Interesting analysis of the history behind currencies on Gielinor, with excellent information detailing the events exposing the background of our economy. This makes it more relevant than we're used to think, as it might have been undervalued from a lore perspective; it's likely the most important aspect of culture, even more than religious, racial, and military parameters.

As a side note, I keep thinking of how Daemonheim/dungeoneering would have influenced the world had it gotten to the surface, as was suggested in a recent future content poll. In my opinion, it could have upset the current foundations of Runescape, sending entire ethnic groups into oblivion from an economic point of view; if what dwells below could ever reach us.
The power of
Guthix
compels you.

14-May-2018 12:18:18

Shifu
Dec Member 2010

Shifu

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One particular thing which always interested me is that, technically speaking, all coins created through alchemy are "fake" coins.

In one of the early god letters, one of the gods (I think it's Saradomin, but could've been Guthix) mentions that all legal coins are created by the Fief. Since alchemy has been a staple spell for many years, trillions of fake coins have been added to circulation - probably a root cause of the ever decreasing value of the coin.

Unless, one assumes that alchemy doesn't actually destroy the item, but merely transports it to some fancy wizards who then return legal coins.
Interestingly, this could be the case, as when we cast alchemy at the circus, the effects are only temporary, whereas the alchemy spell we use, the effect is permanent and irreversible.

I've often wondered why gold is even considered valuable, considering it's easily accessible and easily mine-able. You'd expect any sensible ruling class to claim a monopoly over it, in order to keep the value artificially high.

*Shrugs* Guess it isn't meant to be logical! :P

Interesting read though. :)
If you only do what you can do, you will never be more than you are now.

14-May-2018 23:14:00

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