Governor enabling rentseeking

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Rentseeking is when you are in a position where you can profit without contributing value. The most obvious example is a landlord who charges higher rent in the middle of a big city than in a small town even through both apartments are the same. The different in rent that isn’t attributable to the apartment is location and known as economic rent. This is because space is a fixed resource and that particular location cannot be duplicated, so there’s an excess that can be extracted.

Prosperous Universe isn’t immune to this. When new players start colonizing new planets, plots will eventually run out. Planets are not made equal and some provide a high advantage over others, either because resources are extracted faster or because they are in proximity to other planets. That’s when rentseeking will appear.

There are 2 types that will appear that I can foresee.

First one is individual players who have a base on a rich planet. They will be able to outcompete others because they have an economic advantage that cannot be duplicated. This will create a land value to bases on specific planets. Similar to real world land values, they will depend on the resources of the planet, the difficulty of holding a base and the proximity of trading partners. I wouldn’t be surprised to see players sell bases when that happen, capturing what is known as unearned increment. That’s equal to the capitalized value of the economic advantage of that base.

Second one is corporations locking access to rich planets. This is possible because taxes are sent as dividend to the governor. The theory is the governor will act in good faith and will use these funds to buy resources for planetary projects. That works when player base is small, but the larger it is, the more individuality takes over. The governor is under no obligation to fully utilize the funds for planetary projects.

How that works is a corporation settles on a planet, then elects one of their member. Taxes are then raised to an absurd level. Whenever dividends are paid, the governor redistributes tax income to members based on how much they paid. If you’re not part of the corporation, you pay high tax and get no dividend, so your profitability tanks and you’re forced out of the planet. The corporation can then keep this planet to themselves. This creates the same situation than the first case. Because players are forced into worse planets, the corporation has an economic advantage that cannot be duplicated and they collect rent, enabling them to get richer while others are stuck in poverty.

To prevent that, the governor account must be separate from the player account and funds in that account must be spent in a way that allows everyone a fair chance of getting them. If a malicious corporation tries to raise taxes, then anyone has access to this big pool of money. That makes this behavior unprofitable and taxes will be kept to the bare minimum that can sustain planetary projects.

There are a few ways to handle this and I don’t have a perfect system for that. One system I’m thinking of is to have an open market for contracts. The governor could allocate up to 200K for 1K DW, which would create a 5 days offering period. During this period, players can place offers in the same way that they are placed on the CX. When the period ends, a market buy for 1K DW is done and every offer starting from the lowest is converted to a contract that must be fulfilled within 5 day. A player could have multiple offers at different price points.

For example, Alice places an offer for 500 DW at 75 each, Bob for 200 DW at 70 and Charlie 500 DW at 65. Charlie has a contract for 500 DW @ 32500, Bob 200 DW @ 14000 and Alice 300 DW @ 22500. Failure to fulfill this contract results in reputation loss and would lock you out of this in the future.

There are some disadvantages because it can lead to sniping, which is why I said it wasn’t perfect.

This also has some advantages.

The first is it forces a monetary trade somewhere in the economy. Since the governor must pay money to get all consumables, then they act as a market maker that can be arbitraged with the open market. This should keep both markets in check and provide much needed liquidity.

The second is it creates a demand for higher tier products. As the planet develops, its material needs will also go up. That’s already the case, but this demand is privatized at the moment. By having a public auction, demand for higher tier products is available to all players which should allow a competitive market to develop. Since all players benefit from these planetary projects regardless of their tech level, there can be a demand for higher tier products even if nobody is actually using them. This will bootstrap the higher tier economy far better than selling to vertically integrated MM.

The third one is it create uncertainty in the markets. Since trades are open to all, you might be producing a lot of OFF, but overnight, someone else ramps up their production, undercuts you and now you’re left with a lot of OFF. Every bidding period will have an uncertain amount of supply which will cause revenue variance and will ripple across markets. That’s a great thing to have in an economic game and will create tension around bidding periods. If they are synchronized, that can lead to some interesting drama where you’re trying to second guess where competitors will bid and for how much. If you bid more than you have, you’ll have to quickly turn around and overpay for whatever inventory is available, which is why I set the contract time to 5 days.

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Two things:

Firstly, new players aren’t bound by the planetary plot counts for their first base. So there is actually no way for existing players to exclude new players from joining a good planet. It’s only on your second base that the plot restrictions come into play.

Secondly, in practice, a corporation would find it difficult to get a 50% majority on any major planet, since it would require the co-ordination of hundreds of players. And if it happens on a minor planet, well, the other players can move their bases to somewhere else.

Thirdly - okay, three things - thirdly, I don’t pay a lot of attention to what governors are doing, but I believe that it’s not uncommon for them to implement an auction or bidding system similar to what you have proposed for the planetary upkeep goods. It’s just done informally in the planet chat or on Discord instead of though a dedicated game mechanic.

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I see how your argument works in theory, but in practice, there’s a maxium level of tax the game allows, and I’m still not convinced that level of tax pays for a really rich planet unless maybe taxes are raised after lots of people have extensive bases on there.

Running a planet is expensive… like really, really expensive. When the former governor of Vallis had to step down for RL reasons and passed on the governorship, there was a period of a few weeks where the popi wasn’t being fed. As a person using scientists on Vallis, I worried that I’d lose them if they got unhappy so I threw some money at feeding the popi for a week. It cost around 1 million NCC, and I don’t think I filled everything myself (some stuff had stockpiles left, some other people probably also contributed). It takes a really, really large amount of production to generate that much tax revenue, and this was before the Steam launch when all the starter planets got nearly unmanageable with CoGC upkeep increases and tens of thousands of new pioneers all thanks to new bases that pay little or no tax at all (Imagine all the people that created an account tried the game, then quit. For the next two weeks they generate 0 tax, but still drive up upkeep.)

The only world I could see this kind of rent-seeking kind of working on would be a resource world where the governor doesn’t need to build any infrastructure, but even then, the max taxes on pio buildings are pretty low (120/d) in the grand scheme of things unless it’s on something like 1 million RIGs or you wanted to do some more advanced processing on world, but the governing corp just ships everything out with bulk freighters.

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Don’t underestimate the griefing power of players in a large group. It doesn’t happen because the player base is too small, but the larger the player base, the more individualism will be the main driver. There’s a possibility that players are completely locked out by the time they want to expand. The second planets may be fine because they are close to starting planets, but rich planets out there might get completely privatized. You only need 20 or so players to get there first. To overtake them, you would need to spend a lot more resources than you would gain. Rent is always equal to the difference with the second best option.

It might be, but I have not been aware of it yet. Even if it’s done outside and works for now, it doesn’t scale and still enables full corruption.

That tells me there’s something wrong with this mechanic then if tax revenues cannot fully pay for it. The lack of CoGC levels would be partly responsible for this. Efficiency boosts should end up costing a roughly equivalent amount of resources than what they produce based on a base size level. So when new players move into a new planet, CoGC might have to drop down a few levels. If a planet specializes, then you get more effect per cost and this allows a higher level.

That kind of relates to the lack of high tier material in low tier recipes that is often brought up. You having scientists is supported by the massive pioneer population and someone sticking with pioneer production should get some benefit for enabling scientists. If it’s impossible to upkeep POPI by tax alone because it makes production unprofitable, then it’s unprofitable to improve it and it’s only sustained because some players decide to take a loss for the collective good. That doesn’t scale and isn’t sustainable with a large player base.

120/d is indeed low enough that it shouldn’t matter that much. But the point with rentseeking is it always relates to the second best option. As a governor, your tax is effectively 120 minus POPI upkeep so you have an advantage regardless.

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so negative - which turns into a disadvantage

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That would mean 120/d isn’t sufficient to build whatever is required for this planet. If that isn’t enough to sustain these workers per day, then there’s something seriously wrong with this system. By that logic, a 20/d rate is even worse, so there’s no good rate and should be set to the max regardless. Considering planets do not have that kind of rate, I would say that isn’t the case.

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nope, governors just dont feed popi on planets like montem or promitor. only CoGC upkeep.
Taxes can not pay for POPI upkeep on big planets or “serious” planets that want to push high Pop. It all comes down to “donations” either from the governor or other inhabitants.

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Same on Phobos. The COGC alone consumes 1/3 of the tax revenues. POPI is even more expensive. Raising taxes is vastly unpopular among the players. So rich governing entities and some other rich inhabitants just end up subsidizing their planets. One reason is prestige. The other one is the need for high tier pops.

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My math doesn’t agree, so I guess you’re approaching this with the intent of getting all ratings to 100%? I don’t think that’s the intended goal for POPI because the higher you push it, the higher the population gets and the lower the ratings become. The goal would be to increase it up to a point where you reach a bit over 70% happiness with some unemployment to allow growth.

For popular newbie planets, I can understand why you don’t want to do it because new players push up population values which kills fulfillment. For other planets, that seems to work out.

I’m going to use 70 for DW, 60 for OFF and 250 for SUN.

On Sheol, there’s 1 level of safety station, which consumes 50 DW, 30 OFF and 30 SUN every 3 days. That’s 12.8K every 3 days or 4266 every day. There are 6136 pioneers there, 29.3% unemployed. That leaves 4338 with jobs. Let’s say the average pioneer building employs 50, that’s about 87 buildings. This gives us a daily tax requirement of 49. However, that safety is also being used by settlers and technicians and the 29.3% unemployment is completely overkill. There’s plenty of room to grow that population.

On Ementior, there’s 2 levels of safety station. That’s double daily consumption to 8532. 21892 pioneers with 13.9% unemployment, for 18849 with jobs, 376 buildings. Daily tax requirement of 22.69. Again, this completely ignore safety usage of settlers and technicians. Their happiness is 74.4%, so that seems like a good place to be.

My price numbers are pessimistic and this doesn’t take into account that players most likely have experts speeding up their production cycles, which increases tax revenues since it’s flat per cycle. It’s independent of CoGC because that speeds up cycles and daily revenues which ends up paying for itself.

So let’s use that max 120/d figure. On a planet that can extract 60 resources per day, that’s an extra 2 per resource that is paid in taxes. If the controlling faction only needs to expend 30 to sustain workers, then they collect a 1.5 rent per resource mined on their planet. People will still mine it if it’s more profitable than the second best planet.

I can understand rich players want to subsidize their planet infrastructure to attract other players and this is expected when there’s plenty of choices with 5 players per planet. When land will become scarce, then taxes will raise because someone won’t be sustaining 200 players per planet by themselves and players won’t have any other choice but to pay.

In other words, what we have right now is the middle east oil model where the state controls natural resources which leads to vast wealth inequalities. What we want is the norwegian model where natural resources belongs to the population.