This entry is part 16 in the series Economics In RPGs

A word of advice: Each part of the series builds heavily on the content from the previous one. While you may be able to get relevant information without doing so, to get the most of out of each, you should have read the preceding article. In this case, though, that “previous part” is actually the one before last, and a three-chapter set of quite lengthy posts. You might have to skim – just bear in mind that if anything is puzzling but not explained, it’s probably because it has already been explained earlier in the series.

Welcome & General Introduction

So here we are at last! The final part of what has been an epic series, far larger than I ever envisaged. Even before I start writing this final part (but with section titles in place) the total word-count is going to be over the 140,000 words for the series!

For this final part, I’m moving the table of contents to the head of the article; it’s been interesting to watch it change and evolve as the series has taken shape.

I’m hopeful of knocking this out in one hit, even though that may be impractical – I am going to lose precious writing time to bureaucratic nonsense tomorrow. It’s possible that the post will be delayed, as I won’t have time to prep anything else.

It’s possible that I will edit the series down into an e-book sometime next year. Would there be any demand for such a product? I may well find out.

A disclaimer: I am not an economist and I’m not trying to turn anyone else into an economist. An awful lot of this content will be simplified, possibly even oversimplified. Bear that in mind as you read.

A second disclaimer: I’m Australian with a working understanding, however imperfect and incomplete, of how the US Economy works, and an even more marginal understanding of how the UK economy works (especially in the post-Brexit era). Most of my readers are from the US, and number two are Brits. Canadians and Australians fight over third place on pretty even terms, so those are the contexts in which what I write will be interpreted. And that means that the imperfection can become an issue.

Any commentary that I make comes from my personal perspective. That’s important to remember. Now, sometimes an outside perspective helps see something that’s not obvious to those who are enmeshed in a system, and sometimes it can mean that you aren’t as clued-in as you should be. So I’ll apologize in advance for any errors or offense.

I’ll repeat these disclaimers at the top of each part in this series.

 

Related articles

This series joins the many other articles on world-building that have been offered here through the years. Part one contained an extremely abbreviated list of these. There are far too many to list here individually; instead check out

the Campaign Creation page of the Blogdex,

especially the sections on

  • Divine Power, Religion, & Theology
  • Magic, Sorcery, & The Arcane
  • Money & Wealth
  • Cities & Architecture
  • Politics
  • Societies & Nations, and
  • Organizations, and
  • Races.

 

General Principles – repeated from Part 3

Along the way, a number of important principles have been established.

  1. Society drives economics – which is perfectly obvious when you think about it, because social patterns and structures define who can earn wealth, the nature of that wealth, and what they can spend it on – and those, by definition, are the fundamentals of an economy.
  2. Economics pressure Societies to evolve – economic activity encourages some social behaviors and inhibits others, producing the trends that cause societies to evolve. Again, perfectly obvious in hindsight, but not at all obvious at first glance – largely because the changes in society obscure and alter the driving forces and consequences of (1).
  3. Existing economic and social trends develop in the context of new developments – this point is a little more subtle and obscure. Another way of looking at it is that the existing social patterns define the initial impact that new developments can have on society, and the results tend to be definitive of the new era.
  4. New developments drive new patterns in both economic and social behavior but it takes time for the dominoes to fall – Just because some consequences get a head start, and are more readily assimilated into the society in general, that does not make them the most profound influences; those may take time to develop, but can be so transformative that they define a new social / political / economic / historic era.
  5. Each society and its economic infrastructure contains the foundations of the next significant era – this is an obvious consequence of the previous point. But spelling it out like this defines two or perhaps three phases of development, all contained within the envelope of a given social era:
    • There’s the initial phase, in which some arbitrary dividing line demarks transition from one social era to another. Economic development and social change is driven exclusively by existing trends.
    • There’s the secondary phase, in which new conditions derive from the driving social forces that define the era begin to infiltrate and manifest within the scope permitted by the results of the initial phase.
    • Each of the trends in the secondary phase can have an immediate impact or a delayed impact. The first become a part of the unique set of conditions that define the current era, while the second become the seeds of the next social era. There is always a continuity, and you can never really analyze a particular period in history without understanding the foundations that were laid in the preceding era.

 

THE COMPLETE TABLE OF CONTENTS

Part 1::

  1. Introduction
  2. General Concepts and A Model Economy
  3. The Economics of an Absolute Monarchy (The Early Medieval)

Part 2:

  1. The Economics of Limited Monarchies (The Later Medieval & Renaissance)
  2. In-Game Economics: Fantasy Games

Part 3:

  1. The Renaissance, revisited
  2. Pre-Industrial Economics I: The Age of Exploration
  3. Pre-Industrial Economics II: The Age of Sail

Part 4:

  1. Industrial Economies I: The Age Of Steam
  2. In-game Economics: Gaslight-era

Part 5, Chapter 1:

  1. Industrial Economics II: The Age Of Electrification & Motoring

    Part 5, Chapter 2:

    1. Industrial Economics III: War & Depression
    2. In-Game Economics: Pulp
    3. In-Game Economics: Sci-fi
    4. In-Game Economics: Steampunk

Part 6, Chapter 1:

  1. The Pre-Digital Tech Age
  2. World War 2
  3. Post-war & Cold War

    Part 6, Chapter 2:

    1. Government For The People
    2. Aviation

    Part 6, Chapter 3:

    1. The Space Race
    2. Tech Briefing: Miniaturization
    3. Behemoths Of Blind Logic (early computers)
    4. The Promise Of Atomics
    5. A Default Economy

Part 7

  1. Economic Realities (Inflation & Interest Rates explained)

Part 8, Chapter one contains:

  1. The Digital Age: Themes
  2. The Digital Age: 70s-80s
  3. The Digital Age: 80s-90s

Part 9, this post:

  1. IGE (In-Game Economics)
  2. Future Economics I: Dystopian
  3. Future Economics II: Middling
  4. Future Economics III: Utopian
  5. IGE – Look Beyond The Obvious
  6. IGE at the personal scale
  1. Valuing Possessions
    41.1 Avoiding Mathematics
    41.2 Basic Possessions: Value
    41.3 Inherent Value
    — Functionality, Materials, Labor, Skilled Labor, History, Workmanship
  2. Appraised Value
    42.1 Rarity
    42.2 Age
    42.3 Provenance
    42.4 Wear & Tear
    42.5 Depreciation

      42.5.1 Inflation

    42.6 Appreciation
    42.7 The Antique Furniture Lesson: Social Factors
    42.8 The Religious Factor
    42.9 The Sentiment Factor
    42.10 Remember The Bottom Line

  3. The Mathematics (or lack thereof)
  4. The Worksheet
    start=”45″>

  1. Valuables Types
    — Land, Buildings, Vehicles, Simple Businesses, Mines, Livestock, Old Valuables, Old Rarities, Cultural Relics, Artworks, Basic Valuables, Mementos & Personal Treasures
  1. Genre Notes
    — Fantasy, Pulp, Historical / Detective, Modern, Superheroics, Steampunk, Cowboy / Western, Sci-Fi – near future, Sci-Fi – Dystopian, Sci-Fi – Utopian, Pirates / Swashbuckling
  1. Synthesis: A general process:
    47.1 Sidebar: On Old Problem – currency conversions and historic currency values
  2. The End Of An Epic

IGE (In-Game Economics)

PCs begin interacting with in-game economics very quickly in most campaigns – whether it’s shopping for supplies, coming into possession of a vehicle (intended to provide carriage from one adventure to the next), or simply acquiring valuables, souvenirs, and other personal property.

When they acquire a bit of money or resources of other kinds, they will generally think about upgrades to their equipment – which raises the questions of what is available and how much it will cost – and that’s in-game economics, too.

Other rewards from adventuring start entering the picture not long afterwards – a better place to live, a business on the side, an “investment opportunity”, you name it.

Ultimately, at least in Fantasy campaigns, PCs thought about building castles and other more permanent installations. By now, they may have been granted noble titles and various forms of wealth-generation (which generally go along with the title).

In other campaigns, the PCs may headquarter themselves in the vehicle they possess, or may have been granted residence in a facility owned by someone else quite early on. This is common in superhero campaigns, for example.

PCs are perpetually interacting with the game economy – but the mortal sin is slowing the game down as a result.

    IGE: A Plot-based foundation

    But let’s start with a bigger picture perspective. My advice in this area is to make your economic situation fit the needs of the plot, and use the information provided in earlier parts of this series to get from A to B.

    If you need a stock market crash – or a temporary “correction” – then have one happen. It’s that simple.

    It’s also metagaming outrageously, in my book. The “pure” thing to do would be to go to a lot of effort to understand the economy and internal problems of the game world, and how the society is creating a trend toward this change or that, and yadda-yadda, then extrapolate, and then adapt the adventure to the economic ‘reality’.

    Nope, rejected. Too much work for not enough gain.

    That said, a good general principle is put the economy back the way you found it by the end of the adventure unless you know exactly what you’re doing.

    IGE: Modern

    The modern world complicates everything. People have (hopefully) more understanding of how the modern economy works, there are many more products available, there are usually multiple vendors and sources for everything, there are multiple currencies and policies and interactions between them… it’s easy to get sucked in too deep.

    But it’s also a bigger part of life and harder to gloss over. My world doesn’t revolve around the strength of the Australian Dollar relative to the US Dollar, but it’s something that I have to pay attention to – and a change of a few cents can have spending ramifications at the personal level. So you have to pay more attention to it – it might not be as ubiquitous a subject as the weather and politics, but it’s third in the queue.

    Fortunately, this also gives you more levers to pull in order to orchestrate the economic climate that best fits your plot needs.

    Example: A flaw is discovered in the navigation systems of the most popular type of cargo vessel – they are ordered to drop anchor in the nearest port and stay put while a fix is prepared. Supply chains the world over grind to a halt, and the stock market writes down a number of companies in anticipation of the economic damage that will result.

    Again, be careful not to get sucked down the economics rabbit hole, and make the time period work for you at least as much as it adds to the demands of your game.

    IGE: A broader net

    It’s really hard to write processes and mechanics for universal usage in an RPG. Like really, really hard. Once more, I apply the martial arts principle of using an opponent’s strength against them.

    Being forced to consider both fantasy campaigns and modern-day campaigns, and recent-past settings, and both Utopian and dystopian futures, and being relevant to them all, is a great way to cut through the fog created by getting deeply into the economics of a setting.

    Just pick one that’s very different to your own setting, and make sure that what you are doing translates into that genre in simple terms and you will get a reality check as to whether or not you are getting yourself bogged down.

    In general, looking to the past is better than looking to the future because the situations are inherently simpler, but when you’re running a fantasy campaign that’s set in a pseudo-early-medieval period, you either have to go to the Roman or Greek Empires for your perspective, or look ahead in time. I find the second choice to be the easier one, simply because I know those periods better. Evaluate things in terms of the 1930s or 1950s if you have to.

    The Background Of Choice

    You can take this principle further during campaign creation. Pick one of the eras that I have detailed in the series whose economics and the social consequences thereof fit the adventures that you want to run, and model you in-game economy on something analogous.

    You want dystopia? Model your economy on the Great Depression. You want a trend toward utopia? Model your economy on the wild Optimism that led to the Depression, or to the pre-WWI era of Empires, who thought their interlocking treaties made war between them impossible / unthinkable. And so on.

    Some sci-fi games have been doing this for ages – the Swashbuckling influence over many basic Traveler campaigns is an obvious example; but it works for all genres.

    I want to specifically mention Steampunk at this point – the principle architecture of the genre is late 18th to early 20th century. You can put a lot of spin and nuance on a specific interpretation of such a setting by modeling the economy on a different era, then translating the agency of change into steampunk terms – Steampunk meets 1970s post-scarcity, for example.

Future Economics I: Dystopian

Technology is mostly cosmetic in a Dystopia. Pick any past historic period and focus on the negative aspects – the workhouses of the early Industrial age, for example – and throw in a little tech on the top, for example to monitor production and boost productivity – at the cost of worker health and safety, of course. Throw in a society which considers this to be only reasonable, and hey presto – Dystopia.

To get a Dystopia, you only need politicians to consider their own self-interests (and the interests of those who fund the machine that keeps them in power), and a society in which privilege is answerable only to itself – and wait.

IGE: Dystopian Futures

Ultimately, most Dystopias function through the scarcity of resources, with workers considered one of those limiting factors. Economically, they all owe at least a tip of the hat to the 1970s, even if you use the campaign-setting tools and principles expounded.

Oh, and just because it’s a dystopia doesn’t mean that there’s no source of hope for the future.

Future Economics II: Middling

A late insertion into the contents, a future that – like today – is a mixture of both optimism and pessimism. Perhaps the most realistic type of sci-fi sub-genre. Think of sources like The Fifth Element, or the Marvel Comics Universe.

I tend to think of the Traveler Game Universe as falling into this category – there are historical allusions to the courts of Imperial Rome embedded within the background, and some elements of life in that environment can be pretty bleak and Dystopian, but the solution seems drawn from the Swashbuckling age in many campaigns – Trade being what makes the Empire go ’round. There can also be elements of the Western, especially out on the fringes of ‘safe’ society.

Some GMs don’t seem to realize that Trade can be more than boring purchasing and selling and counting the profits, it can actually be the driving force that delivers adventures to the airlock. That was a serious problem with the last such campaign that I played in – the GM wanted the PCs to take sides in a political conflict that he had orchestrated without giving any of us reasons to have skin in that particular game. We decided to go trading and leave the politics to others, as much as possible, and this threw his entire campaign plan into the wastepaper bin.

In response to that situation, i wrote up a game supplement that has been shared widely in the years since, Buy Low, Sell High – Trade In Traveler. Since it is clearly relevant, I’m offering another download link – just click the icon.

Future Economics III: Utopian

Utopias can actually be harder work than you think. Star Trek is largely viewed as a Utopian Future, especially as presented in The Next Generation – but the replicator has eliminated scarcity and material needs, completely revising one of the fundamental assumptions of society.

What the writers found, as the series progressed, was that they hadn’t completely eliminated the concept of an economy. There were still financial limits on what people could do; they had simply replaced one constraining factor with another that had already existed but that had not previously been dominant.

You could replicate all the parts that you need for a starship, but you still needed dockyard space and skilled technicians to install and calibrate everything. So there was still a limit to production, it was just a different one.

Utopian futures are ones in which life is at least comfortable for most people and opportunities are unbounded by social, political, religious, or other reasons; if you put in the work, and have what it takes, you can be anything that you want to be. What’s more, no matter how dark things may become, there is justifiable optimism for the future.

“The price of liberty is eternal vigilance” – so wrote Thomas Jefferson (or maybe it was Patrick Henry or Wendell Phillips or Junius).

Regardless of the source, it’s just as true in a Utopia as it is anywhere else – you can change the nature of Society (a human invention) but that does not change the nature of humans; they are still just as capable of being venal, cowardly, greedy, corrupt, or any of a dozen other character flaws. Those flaws might be rendered less prominent by the satisfaction of material needs and holographic companions, but that doesn’t eliminate them. Utopia is under constant attack from both within and without, and needs to be defended.

    IGE: Utopian Futures

    That means that most Utopian futures are variations on the basic economic theme and not the wildly different economic beasts that they initially appear. Nevertheless, there will be ramifications of whatever made / makes the Utopia possible, and those need careful thought.

    Or no thought at all. A good line of patter and a semi-plausible rationalization is enough to hand-wave the whole question. The critical question then becomes, ‘what’s the rest of society like?’ – what is this an idealized reflection of, in high-tech dressing? Which places utopias on the same conceptual footing as any other genre, at least in economic terms.

    IGE: Space Opera

    Oh, my goodness, talking about hand-waving!

    It’s a fundamental tenet that there is always enough money to build something big, and if there isn’t enough money, that’s always a solvable problem, a passing inconvenience, nothing more.

    Need money? There’s a planet out there somewhere that has deposits of Unobtainium – you just need a clever way to find it. Immediately, Asimov’s The Currents Of Space come to mind (Limited copies at reasonable prices through Amazon – mostly second-hand, I get a small commission if you buy one) – and, problem solved. It’s just another adventure on the way to the next adventure.

    Right away, that tells me that Space Opera has to be based on an optimistic technologically-savvy era, far removed from the cultural shift of the 1970s. No matter how dark, a Space Opera is inherently Utopian in premise – some examples just bury that premise very deeply. Star Wars is fundamentally Utopian.

    It’s up to the GM to create that gung-ho attitude amongst his players, and the best place to start is with an example like the one offered, and a galactic economy that supports a nigh-infinite economic strength.

    There’s an element of the Swashbuckling, as well – did you ever stop to think about where ships come from in Pirate games? They just appear in ports at the speed of plot, ‘gifts’ from the governments that build them – and there’s always enough money to buy / build another one.

IGE – Look Beyond The Obvious

I think that I’ve amply demonstrated both the power and usefulness of the general principle with the analysis above. If there are only two takeaways from everything in the post to date, it would be that principle and the corollary, Look Beyond The Obvious for your campaign’s economic foundations.

As originally formulated, that’s where this article was going to end.

But, shown by the table of contents, there’s a lot more to come. But first, a little backstory – heavily censored to keep secrets from players.

As part of an adventure that’s currently being worked on, a list of antiquities has been generated. Some are inherently valuable, some valuable because of who is referenced by them or who created them, some have cultural or historical value, and so on. Most were available to the purchaser relatively cheaply, and said purchaser had a canny eye for objects that would appreciate in value significantly.

Which begs the question, how much are they worth?

I put together a spreadsheet to attempt to answer that question, but hadn’t put enough thought into the mechanics that were to be embedded within the mathematics of the spreadsheet. And it started to get very complicated.

And then i thought of another approach – one that could be described, ready-to-implement, in this article, where it seemed to fit like a glove.

IGE at the personal scale

When you get right down to it, there are three basic types of possession:

  • Basic – The possession, an object, just is, and won’t change significantly in value – ever – from a campaign perspective. It has an intrinsic value / replacement cost, that’s it. Simple examples include a character’s personal weapon, the clothes on his back, and so on.
  • Depreciating – Anything that wears out or declines in value is a depreciating asset. The word simply means that it loses value over time. That’s normally too technical a matter to keep track of in an RPG, but there’s a way to use the information to your benefit, as you’ll see. The simplest example is a credit card or cheque account (remember those?), where fees and interest erode the balance.
  • Appreciating – This means that it’s going up in value faster than it’s going down, for a net increase in value over time. The simplest example is a bank account that pays interest.

It’s important to keep the type of possession in mind when determining the value at some time other than the time of creation, or the current value of something created at some other time and place. I’ve helped out with a list of valuables a little later, but first, some general principles…

Valuing Possessions

Every GM needs to have a process for determining the cost / value of objects in their campaign. I remember in one of the early adventures in the Zenith-3 Regency campaign, the players stumbled over a bunch of high-end thieves (which I had modeled on The Circus Of Crime). I renamed the leader Psyche, and made the Circus Assassins For Hire (who commit a little a lot of Robberies to cover their tracks amongst other motives. To create the appropriate sense of awe and anger amongst the PCs, I generated a list of unsolved major robberies – 5½ pages long, about 16 items per page, net value of 1701.7 Million 2055 British £.

Curiously, the thing that got them most worked up was the following entry:

    Year/No: 2029/2
    Report #: 2029598407
    Victim: Adela Evangelina Love
    Value: 44.5 £m
    Object: Puppet – Original hand-puppet, “Kermit The Frog” (Children’s television Workshop/Jim Henson)

5½x16= roughly 88 stolen objects of considerable value. That’s a lot to invent off the top of your head, even doing it over time and in advance. And even once I had done so, and created the list of Victims, I had to try and come up with reasonable valuations for them all. How much should the original Kermit be worth, exactly a century after his first television appearance?

As I recall, I was running short of time and couldn’t devote deep thought to the question back then.

The Valuation process involves 6 factors to produce an Inherent Value, and a second set of 8 factors to get a final valuation.

    Avoiding Mathematics

    The basic premise behind the new approach is to avoid mathematics as much as possible. You decide on how much more something is worth, taking each additional factor into account, write it down and move on.

      Choice

      It’s the GM’s choice how big a role each factor should play and what the ultimate valuation should be. In fact, my original idea for the worksheet that I have generated was a simple checklist.

      Random Choice

      There may well be times when you have literally no idea. When that happens, roll 3d6 and record the result, divided by 10, in the appropriate space on the worksheet. The GM then gets to decide what that actually means in terms of the value.

      Roll_of_3d6-sm

      3d6 was chosen because it delivers a genuine bell curve. 10 was chosen because it’s almost exactly the average and it’s a nice round number, making for easy maths.

      To be honest, though, it gives extreme results a little too frequently; the ideal rate would be about half as frequently. But more dice is more inconvenient, and it’s just a guideline for the GM to interpret, so it’s not worth doing anything more complicated. 6d6/20 would be more accurate but not worth the extra effort.

      I will be providing, with each factor, some sort of guideline for interpretation.

      Maths for those who insist

      While I’m going to avoid maths as much as possible, I will take a moment in discussing each valuation factor to describe the maths that would be involved, from a conceptual point of view.

    I thought it might be useful to throw in a small-sized screen capture of the worksheet before I start digging into specifics. This image is now out of date, the worksheet has been completely redesigned. Much of what is written below will carry over, but not all of it. Click this link to open, in a new tab, the discussion post and download link to version 2.0 of the worksheet – for when you are finished reading here, of course!

    Basic Possessions: Value

    Most of what a character is carrying for use will have whatever value the “book” assigns them. That doesn’t mean that you can’t use this system to value them, just that you usually don’t have to.

    On the other hand, if a character wants a jeweled pommel, and gold-inlaid motto, and other decorative touches, the possession starts to move beyond the basic valuation provided in the sourcebooks. That’s where this system comes into its own.

    Always remember that the book value is the General price for a New version of the item. Second-hand will be worth half, or less. Rarity / Demand or other factors could double it or more. So even in these matters, the GM is required to make a few decisions based on the economy, both ‘globally’ and ‘locally’.

    Inherent Value

    The inherent value is value that can’t be eradicated.

      Functionality

      The object has a certain value because of what it does. In some cases and settings, this can be 75% of the total inherent value, for example firearms, swords, etc. In other cases, like jewelry, the functionality is often near-zero; the major exception is when the object has a socially-defined symbolic value. A wedding ring has a definite functional value to be taken into account, for example.

      As a rule of thumb, assume that the functionality value includes the value of standard materials used in construction of the possession.

      I have to admit that when I was adding this category, I was thinking about High-tech tools and such, and Magic within an object. A “Flame Tongue” sword has functional value because of the magical plus, and still more from the Flame Tongue ability.

      You should never decide functionality value with a die roll. I can’t stop you, but you shouldn’t do it. That’s because the function doesn’t change, and so neither should its value.

      Some readers may argue that demand for some functions will be higher than others, and that’s true – but already factored in, and with a later section (under ‘Appraised Value’) dealing with social desirability, this argument is moot.

      Materials

      Since standard materials are already taken into account, this category is purely for the exotic.

      Materials includes gemstones and rare / precious metals and anything else along similar lines.

      Purity is also a big factor – and value is not directly proportionate to purity, because some purity levels are rarer than others. 24-carat cold is not the most pure you can get – but it’s relatively rare, compared to both 22- carat (less pure) and 26-carat gold.

      It’s complications (I’m tempted to say ‘perversions’) like this that complicate what should be a straightforward valuation.

      A high roll could indicate that a rare purity of metal was used, or that there are some exotic materials, or something along those lines. And don’t neglect the possibility that the dice are telling you of a fancy scabbard or holster!

      Labor

      There’s a labor cost involved in turning the raw materials into the finished product, but in the case of standard materials, those will already be included in the functionality valuation.

      This is for any extra work unskilled required to incorporate exotic materials or designs into the possession that isn’t already taken into account.

      That’s an important point to note: if your materials includes the value of cut gems, then the cost of the gem-cutting is already included; if it doesn’t, for some reason, the gem-cutting would need to be included here.

      A high roll here indicates that someone has taken extra care in manufacturing the object, or that a particularly labor-intensive process was used for some reason. A low roll indicates that the work was done in haste, corners were cut, and so on. Or, perhaps that the object was actually made by an apprentice – supervised or otherwise.

      Skilled Labor

      I thought about having just one category for Labor but realized that not all craftsmen are equal, and the ability to distinguish one labor source from another might be important.

      For example, you could list the gem-cutting under ‘unskilled’ labor because it was done by someone far less skilled than the artisan who set the gems into a decorative brooch made of white gold, yellow gold (22-carat), and silver. Or it might be the other way around. Whatever – two or more sets of craftsmen are more easily dealt with by separating them out.

      A high die roll here indicates exceptional use of skilled labor – some people insisting on being involved in the whole process, even those parts that can usually be trusted to others.

      This isn’t so much about the skill of the artisans, it’s about the time that they have invested in the production, and how much more they expect in recompense..

      History

      This is about the Reputation / Name Recognition of the Crafter, not of any owner.

      This can be a substantial contributor to value in the case of rare books, and – in the modern eras – of jewelry, for example. Some weapons manufacturers have a certain level of brand recognition that adds to the cache – who hasn’t heard of a Winchester Rifle, or a Colt .45? Or, for that matter, a pair of Adidas sneakers?

      There can be cases when this is 95% or more of the valuation. One of the treasures that has been placed in the adventure that drove the creation of this section are Ostracon from ancient Greece. These are sherds of pottery in which a name has been scratched into the glaze.

      In Classical Athens, when the decision at hand was to banish or exile a certain member of society, citizen peers would cast their vote by writing the name of the person on the shard of pottery; the vote was counted and, if unfavorable, the person was exiled for a period of ten years from the city, thus giving rise to the term ostracism.

      — Wikipedia, Ostracon

      Of course, some people carried prepared ‘votes’ around with them in case the opportunity arose to exile someone of whom they disapproved.

      ‘Plato’ in Greek (actually, ‘Platon’, a direct translation)

      So, our treasure-hunter has acquired three of these bearing the name Plato – who, like all Philosophers, voiced unwelcome thoughts attacking the status quo from time to time, or so they were perceived. For all that many Greeks were enthusiastic supporters, he would have had enemies – people he had humiliated in debates, for example.

      How much are they worth? A cent or so – until you add in the History and social purpose of the objects, and suddenly they shoot up in value. Maybe not very far, but high enough to be significant little treasures. That part of the valuation comes later, however.

      I bring them up to ask: How much more would they be worth if it could be proven that they were owned by another prominent Greek who was contemporary with Plato?

      That’s the value that gets encapsulated in this section.

      The example should make interpretation of a random roll result fairly obvious, but it’s worth mentioning that even unproven or disputed claims can increase inherent value – not as much as authenticated value, but more than nothing.

      One more example: Paul Revere (and his son) were famous as Silversmiths. Anything made by Revere is worth more than an identical object of identical vintage that was produced by a nobody. How much more? That’s for you to decide – but a factor of 10 wouldn’t be out of line, given his fame as both a high-quality Silversmith and a Founding Father.

      Workmanship

      Which brings me to Workmanship. Some objects can’t be ruined; others can be transformed by poor craftsmanship into scrap.

      Before you can interpret Workmanship and factor it into you valuation, you have to decide into which of these camps the object belongs.

      If a bronze statue comes out of the mold flawed, you simply melt the bronze down again while fixing the mold. But an unskilled baker can reduce flour, sugar, and eggs into a blackened mess of absolutely no value.

      As a general rule, it’s the ability to undo or correct a flaw that separates one category from the other.

      If a possession can’t be ruined, all you are looking for is the amount of value that gets added for craftsmanship. If a possession can be ruined, then poor craftsmanship should reduce the value of the object – while excellent craftsmanship should have an amplified impact on the valuation.

      Putting it all together

      There are two basic techniques, and either of them is valid. In the first, you write down the contributions of the factor to the total value; in the second, you take the previous line’s value and update it to include the influence of the factor in question.

      Most of the time, I would expect to use the ‘as you go’ second option, but there may be time when I want the additional specificity of the former.

      A third approach is possible – writing a multiplier in each space after the functional valuation, then doing a lengthy multiplication with a calculator. This is a more accurate representation of the effect of these variables, but it’s a very hard thing to get right, and it can be a right pain finding the one value that’s out of whack (assuming you only got one wrong)!

      So this isn’t the recommended approach – but it remains possible if you insist on it.

    Appraised Value

    One you have an inherent value nailed down, it’s time to contemplate the broader factors that can influence the value placed upon an object.

    I want to start by mentioning a factor that was in early drafts of the process and that has now been dropped, “Demand”. This is a driving factor in “Appreciation” and so has been subsumed into that heading.

      Rarity

      This is a can be a complicated thing to assess. Is something that was rare at the time it was made, but likely to have survived, rated more highly than something that was once present in large numbers but rarely survives?

      Do you take age into account when deciding rarity, in other words?

      The answer is no. This is purely an assessment based on how rare the possession is at the moment of valuation. And it’s always a value relative to similar objects.

      The higher a die roll, the more one-of-a-kind the possession is. If that doesn’t tally with your description, you have multiple options:

      1. you can amend the description to boost the uniqueness to match your roll.
      2. you can interpret your die roll, not as an absolute, but as a point within a range of results that does tally with the description (my recommended approach).
      3. you can re-roll, or just ignore the roll.

      Age

      I thought seriously about redacting the ‘random roll’ element for age guidance – if you can’t tell how old something is from the description, your description is incomplete.

      But then I realized that descriptions might be incomplete, and that random roll used to discern one possible source period over another.

      A low roll could indicate that the whole possession is a clever fake, wiping out almost all of the value.

      And even if you know from whence a possession derives – be it 100 or 4000 years ago – there is going to be a fudge factor involved, a range. Whether an object dates from early in that period or late can also have an impact on the value.

      So the dice roll in this category is not completely worthless.

      An even bigger question is how much age should increase value? After devoting considerable thought to this question, I have come to the conclusion that it’s going to be different for every general class of object, and decidedly non-linear in all cases. A large question is going to be the lifetime of the possession and how far through that lifetime this particular example is.

      To ensure clarity and consistency, I can only suggest that you process like possessions at the same time – and use past valuations as a guideline.

      As a rule of thumb: from age 50 to age 100, antiques used to rise in value 10-20 fold – from a depreciated base price. From 100-1000 years, it’s 100-200-fold in most cases, relative to that depreciated base value. From 2000-4000 years, it’s 1000-2000 fold from the same base. But that’s a big variation.

      An example to close out the sub-section: An object with an inherent value of $100 depreciates at the rate of about 2% a year, or about $2. If it was $2 per year, at the end of the 50 years, it would have an inherent value of 0 – but that’s not a correct assessment. The value is 98% of what it was at the end of each passing year, so the reduction gets smaller as the value drops. The formula is

      100 x [ (1 – loss/100) ^ (N-1) ].

      So, in this case, 100 x [ (1 – 2/100)^(50-1) ] = 100 x [0.98^49] = 37.16% of the original value. So the base value is $37.16 at the point it becomes an antique, and starts – theoretically – appreciating in value as a result.

      Add another 50 years of age, and we’re talking $371.60 to $743.20. Call it $370-740.

      Add another 100 years, and you’re into the lower reaches of a 100-200 fold increase – let’s use a factor of 105; multiplied by $37.16, that becomes $3901.80. 700 years later, and we’re in the upper reaches of the range – maybe a factor of 180, or a value of $6688.80.

      Of course, technically, the object should have continued to depreciate for those additional years. But that’s a complication we don’t need right now.

      Because here’s the thing – this increase is only a guideline. We’re not appreciating the value, that comes later; we’re trying to assess the increase in value because of rarity. The two questions are not unrelated, but you also have to take into account the rate of decay of the materials, state of preservation, and any similar factors. Since the estimated value impact doesn’t take any of these factors into account, it can be used as a base valuation, but has to be modified.

      Note that 2% is relatively slow for a devaluation. Tech generally depreciates at 10-20% a year; non-tech at 5-10% if it’s relatively flimsy (cheap furniture, for example) or 2-5% if it’s sturdy.

      Provenance

      Was the object owned or used by someone famous? There are a number of gradations to such claims, and each one has a marked influence over how big a deal this is.

      At the top of the scale, we have documented authenticated unquestionable proof. 1000 or more times the reference price is possible, but the amount has to be determined by you.

      Below that, accepted as probably genuine. These can be hundreds of times more valuable than the reference price.

      Then there’s contested, in which some experts say yes, and some no. This gets you about half of the potential increase – and that is something that you’ll have to determine.

      Below that are untested claims. They rank higher than the next category down because there is an unknown possibility that the claim is correct. +10-20%, and more often toward the lower end of that value..

      The second-lowest value is rejected claims. That happens when the authority doing the authenticating simply isn’t convinced. Note that this isn’t the end of the road – more evidence may be out there somewhere, prompting a reassessment. It doesn’t happen often, but it does happen. In the meantime, the object will lose up to half its reference value.

      Below that are proven or presumed forgeries and fakes. These generally lose 90% or so of their value, and may even be ordered destroyed by the authority in question.

      Note that this factor may already have been incorporated into rarity, in whole or in part.

      Wear & Tear

      Depreciation takes into account regular wear-and-tear; this category is for exceptional, out-of-normal damage. It always reduces the value of a possession. The question, as usual, is how much?

      If the damage can be repaired invisibly, it might be a negligible amount.

      If the damage can be repaired, but imperfectly, it’s going to be a more substantial reduction.

      If the damage can’t be repaired, the loss can be significant – unless the damage itself is directly tied to the rarity of the object, and the historical significance is why repairs are out of the question, in which case the value can actually be increased. The Liberty Bell is a good example of the latter. The damage to the White House when the British set fire to it is another.

      Depreciation

      There comes a point at which a possession is considered valueless aside from any sentimental value.

      But here’s the thing: the longer a possession depreciates, the smaller the impact of depreciation. In the earlier example, I calculated the effects of depreciation at 2% over 50 years as turning $100 into $37.60. Let’s expand that out:

      50 years = 100*0.98^49 = 37.60%. Loss = 100-37.6 = 62.4%.
      100 years = 100*0.98^99 = 13.53%. Loss: = 37.6-13.53 = 24.07%.
      200 years = 100*0.98^199 = 1.79%. Loss = 13.53-1.79 = 11.74%
      500 years = 100*0.98^499 = 0.0042%. Loss = 1.79-0.0042 = 1.7858%.

      The loss per year is more informative:

      50 years = 62.4 / 50 = 1.248% per year.
      100 years = 24.07 / 50 = 0.4814% per year.
      200 years = 11.74 / 100 = 0.1174% per year.
      500 years = 1.7858 / 300 = 0.00595% per year.

      Depreciation becomes a negligible factor after a while if a possession starts appreciating due to antiquity and increasing rarity.

      The higher the depreciation rate, the more quickly this happens – and the above are the impact of just 2% depreciation. If the rate were 5% instead, you would expect it to happen at least 2 1/2 times as fast, maybe more.

      Furthermore, it can be considered that the increases due to rarity compensate fully for those losses – so it’s the 50-year mark that is of concern.

      2% at 50 years = 37.6% value.
      5% at 50 years = 8.1% value.
      10% at 50 years = 0.57% value.
      20% at 50 years = 0.00178% value.

      50-year old tech is essentially worthless – as tech. As a product, it may be worth thousands of times the original purchase price – a Ferrari sports car for example. Put a 50-year-old example up for auction and you can be certain of attracting interest!

      Inflation
      Another factor to consider is inflation – which, by making each dollar worth less, means that it takes more dollars to equal the value of a possession.

      Inflation is like Depreciation in reverse. Except that the amount keeps varying.

      Assuming a typical overall inflation rate is going to be a lot less accurate and a lot easier. In the bad years of the 1970s, inflation might well have a 10 in front of it, but most of the time, it’s a lot less. Maybe 3-5%.

      So, let’s use 4% and see how that affects those depreciation values:

      2% depreciation vs 4% inflation over 50 years = (1.04^49)*37.6% = 6.833 * 37.6 = 256.9208%.
      2% depreciation vs 4% inflation over 100 years = (1.04^99)*8.1% = 48.56 * 8.1 = 393.336%.
      2% depreciation vs 4% inflation over 200 years = (1.04^199)*0.57% = 2452.6 * 0.57 = 1397.982%.
      2% depreciation vs 4% inflation over 500 years = (1.04^499)*0.00178% = 315,963,059 * 0.00178 = 562,414%.

      Inflation grows more significant with increasing time. It more than compensates for the ongoing decline due to appreciation if it is higher than the depreciation rate – if I had run the above calculations with a 2% inflation rate, inflation would have exactly matched depreciation and I would have gotten 100% each and every time.

      Inflation isn’t the same everywhere, and that’s what to read into any random die roll – how bad it was in a relevant location relative to the overall standard.

      (Of course, by making the dollar smaller, Inflation also cuts earning power even as it puts prices up, a double whammy – which then becomes a triple whammy when pay rates go up in compensation, ironically pushing interest rates up or – at best – keeping it where it already sits.

      Appreciation

      So, we’ve covered how much value something gets from increased rarity. Now it’s time to talk about how much it increases in value just because it’s older – assuming that rarity doesn’t change.

      This works in exactly the same way as inflation except that the actual value of the possession is increasing.

      It’s often not as fast, at least for the first 50 years or so. In fact, it’s easier to assume that there is little or no appreciation until that time, then to load on a whole-dollar estimate rather than doing calculations.

      Different types of possessions will have different appreciation rates.

      The other factor to take into account in determining appreciation is supply vs demand. Demand higher than supply pushes prices up, demand lower than supply pushes them down.

      We’re discussing demand for this particular object, or for anything similar enough to replace it, so bear that in mind.

      Artworks can appreciate in value incredibly quickly, at least for a while. The values placed on some of these can be absolutely staggering – and, as they age, are only likely to go up in price.

      The current record was set in 2017 (pre-pandemic, obviously) at $450.3 million (USD, presumably), for a work attributed to Leonardo da Vinci called “Salvator Mundi, the Savior of the World” (if the title is translated into English).

      It is enormously helpful to have some idea of the degree of recognition an artist received and when. Some artists became famous while still productive; others found fame only after passing away.

      The Antique Furniture Lesson: Social Factors

      The other day, I read an answer on Quora stating that the bottom had fallen out of the antiques market. Furniture and objects that were worth $250K USD at the time of purchase were not worth the cost of having them hauled away (that’s what I call a collapse!).

      The antique market, it seems, has been flooded by all the elderly people with their huge antique collections, dying, while – at the same time – younger, more affluent types were no longer interested in paying $20K for an antique dressing table.

      Note that I have no knowledge of the situation either way – I am simply reporting it as an illustration of the profound impact on value of social factors.

      Of course, the market has likely over-corrected, and a lot of the (ahem) less-valuable pieces will get destroyed, one way or another, driving up the rarity and desirability of what’s left until some rational equilibrium is achieved.

      The answer referenced dates from October 13, 2023, but describes historical findings from about 20 years earlier. That’s plenty of time for the worm to have already turned – but you also need to factor Covid Lockdowns and the consequent social and psychological changes into account – living at home emphasizes functionality and purpose and comfort above all other considerations; so the situation may well have re-reversed itself, too!

      I would recommend that any die roll results be evaluated with reference to some baseline; some things are always going to have incredibly high social value. If your instincts are that social valuation should at least double the value of an item, use the minimum roll result as indicating just that, and anything better as suggesting a valuation in excess of that doubling.

      Beyond that, if the dice indicate an exceptionally low social valuation, you have to ask yourself why? The best answer is, no matter how exquisitely wrought, some objects raise uncomfortable questions for a prospective owner, and some are simply ugly or inconvenient in some way.

      The opposite is also true – an amateur painter can paint a single breathtaking landscape throughout their ‘career’, never becoming famous; it will be worth a pittance in every way except social factors, where it gets a bonus for simply being pretty.

      The Religious Factor

      Religion always has the potential to mess everything up, and this process is no exception. Why? Because it inflates the value for some people massively while excoriating ti for others. The purely pragmatic will adopt a value somewhere in the middle, which is probably more correct than either extreme – but there are exceptions.

      I remember, twenty-odd years ago, seeing adverts for pieces of the original cross. And for pieces of the original ark. And for an ‘original scan’ of the Shroud Of Turin.

      Now, I’m not saying that any of these were fakes, or deceptions; nor am I suggesting that people didn’t get what they paid for. I’ll leave such implications to the imagination of the reader. But – how many pieces of the original cross were there that they can be sold over the internet at $20 a pop? I have my doubts…

      But there are true believers out there, and they would and did buy such items indiscriminately, with boundless zeal. (Which did give rise at one point to thoughts of an adventure in which a believer was inadvertently shipped the real thing…)

      The religious factor is an attempt to put a Conditional Adjustment on the valuation. It should be self-evident to whom the adjustment applies, but the GM is free to play with that in his plot – I remember a storyline (but forget the source) in which a collector of art buys a famous work, only to publicly destroy it before a horrified audience. Why? Because there were five, there are now only four, and he owns three of them – the appreciation for his remaining collection more than compensates for the loss…

      More to the point, perhaps, I can easily say an enemy shelling out the premium price in order to destroy or suppress an object with the potential for undermining their own authority. Even a fake can be extremely valuable, if it raises the right doubts at the right time, and worth paying to eliminate.

      (Suddenly, my mind is flashing back to the warehouse scene that concludes the original Indiana Jones movie…)

      The Sentiment Factor

      The final factor is the most nebulous of them all, because it is a function of the psychology of the prospective seller. Sentimental value can inflate a price five-fold or cause a seller to dispose of a possession at fire-sale prices. Neither option affects the true value of the object in question.

    The Mathematics (or lack thereof)

    The values that in combination yield the Inherent Value are additive, even if you estimate them based on a multiple of the prior value.

         Value X x factor Y = revised value Z

    really means,

         ‘Add a value contribution equal to (value X x factor Y) – Value X to get revised value Z’.

    That’s not the case with the Appraised factors – these are multipliers.

    What’s more, in several cases, they are multipliers which derive from the principle of “A change every B years”. Again, the simplest example is a compound interest bank account.

    The maths can quickly grow horrendously complicated. At one point, I thought it might be possible to establish a common foundation term (five years or ten years), determine a modifier over that time frame, take logarithms and simple add and subtract the results across all the different categories to get a net change over the lifetime of the object (less the initial 50 years).

    It didn’t work; it bogged down, and got too technical for practical usage. I wanted a system that was simple enough for a GM to work in his head if he had to, using this article or the worksheet as a checklist.

    Mathematics are used in the sections above purely to give a sense of what the scale of adjustments should be.

    Remember The Bottom Line

    And always, remember the bottom line: the valuation derived is purely theoretical, the real value of a possession is what someone else will pay for it – as modified by what they can afford to pay for it!.

    The Worksheet

    Okay, so I have been referencing the Worksheet throughout this article; it’s time to talk directly about it.

    Dead Link

    Click to download Campaign Mastery’s Free Asset Valuation Worksheet

    The Zip file contains the following:

    • Worksheet, A4 size, PDF format
    • Worksheet, A4 size, OpenDocument Text format (the original file)
    • Worksheet, A4 size, Word 97-2003 format (.doc – an export that may or may not display properly)
    • Worksheet, US Letter size, PDF format
    • Worksheet, US Letter size, OpenDocument Text format
    • Worksheet, US Letter size, Word 97-2003 format (.doc – note as A4 version).

    …none of which is true anymore. This archive file has been removed and replaced. Go to Asset Valuation Worksheet 2.0 to read about and download the updated zip file (which still contains the legacy versions as well).

    Usage

    I am including the non-PDF versions because they can be filled out electronically and so provide maximum legibility. The chief danger of doing so is that you can overwrite your original. For that reason, I STRONGLY advise that the first thing you do is to ‘save as’ the file, renaming accordingly – or never open the original file at all, just a renamed copy.

    Beyond that, usage is as described in the above text. The worksheet permits up to five valuations per page – I could have fitted more, but the description slot was the limiting factor. I thought about an ‘index’ section oriented differently to the current layout as an alternative, but by the time I’d added space for documenting any random rolls, I didn’t think I’d get many more across the page (my first draft actually had space for 7 valuations but felt too cramped).

    Finally, if you don’t use the ‘factor’ column for 3d6 results, you can put a reference number in there, pointing to relevant notes on the reverse of the page.

    Always, assume that at some future point, you may have to explain to yourself why you have made a valuation decision. This not only helps focus your mind into concrete terms right now, while using the worksheet, it can be invaluable when you have to revisit a valuation months or years later.

Valuables Types

As I was writing the preceding sections, I was always considering specific types of possession and how they would work within the appraisals process. This was largely so that I could make the process as universally relevant as possible, but it had the side effect of bringing various thoughts to mind as I went.

Consider this section as more of an appendix, providing specific notes regarding the valuation of specific types of valuable.

    Land

    Land never – well, almost never – depreciates. The caveat comes from traumatic events like damming waterways, redirecting rivers to new courses, etc. These events tend to be rare, tend to be the work of governments, and are often subjects for compensation claims.

    The reason is that there is a fixed supply of conveniently-located land, and as populations grow, so will the demand for same.

    Buildings

    Buildings, on the other hand, DO depreciate.

    It can be argued that there is a point at which the building is essentially valueless, and the point at which depreciation brings the net value down to that value defines the natural lifespan of the structure.

    The corollary is that you can decide what the lifespan of a structure is intended to be (assuming regular routine maintenance), and determine the depreciation rate that matches.

    Both are useful techniques to have in your back pocket.

      Variable Lifespan, simple depreciation rate

      Buildings in Australia are generally considered to depreciate at 2.5% every year for 40 years after construction, at which point they are valueless for rental properties. This is simple depreciation, based on the original valuation, not getting smaller each year.

      But the US Rental market uses 3.636% each year for 27.5 years – which works out to a total loss of value if you use simple depreciation.

      And the US Tax Office says that depreciation should be an equal share of the initial value divided over 39 years of aging – again, simple depreciation.

      The reality is that all of these are simplifying the calculations to avoid confusing the lay public and make investment and tax returns simpler to complete and check.

      And the underlying and unstated assumptions are that we’re talking about ‘modern’ buildings, i.e. those constructed in the last 40 (or 27.5) years.

      In ages past, some buildings were built to last. Many medieval castles are still standing (if in need of substantial repairs) – they would have a lifespan on the order of 400 years. The exceptions generally come from warfare. 100-year-old barns are in a similar state. 50-year old log cabins, ditto.

      Substantial renovations can ‘restart the clock’. That’s why there are old buildings in many cities that are still viable rental properties / homes.

      All of which means that you need to take into account not only when the building was constructed but what it’s purpose was, and when it was last renovated top-to-bottom.

      Simple depreciation doesn’t work for our purposes, but it does illuminate the basic settings.

      Let’s set a ‘zero level’ – $2000 value remaining on a $50,000 initial investment. If the original was $250,000, the ‘zero level’ is a value of $10,000. These are the points at which it is more cost effective to remove the rubble and build anew.

      The formula is:

      y – 1 = log 0.04 / log [1-(D/100)]. But I’ve done all the math for you (I’ve only shown the working for the first value):

      Depreciation Rate: 10%: y – 1 = log(2/50) / log [1- (2.5/100)]
           = -1.398 / log (0.9)
           = -1.398 / -0.0458
           = 30.5; so Y = 31 years.

      More than anything else, this shows the stark difference between ‘real’ depreciation and ‘simple’ depreciation.

      Depreciation Rate: 9%: Y = 35 years.
      Depreciation Rate: 8%: Y = 39 years.
      Depreciation Rate: 7%: Y = 45 years.
      Depreciation Rate: 6%: Y = 53 years.
      Depreciation Rate: 5% Y = 63 years.
      Depreciation Rate: 4.5%: Y = 70 years.
      Depreciation Rate: 4%: Y = 79 years.
      Depreciation Rate: 3.5%: Y = 91 years.
      Depreciation Rate: 3.25%: Y = 98 years.
      Depreciation Rate: 3%: Y = 106 years.
      Depreciation Rate: 2.75%: Y = 116 years.
      Depreciation Rate: 2.5%: Y = 128 years.
      Depreciation Rate: 2.25%: Y = 142 years.
      Depreciation Rate: 2%: Y = 160 years.
      Depreciation Rate: 1.5%: Y = 213 years.
      Depreciation Rate: 1%: Y = 321 years.
      Depreciation Rate: 0.75%: Y = 428 years.
      Depreciation Rate: 0.5%: Y = 643 years.
      Depreciation Rate: 0.4% Y = 804 years.
      Depreciation Rate: 0.3%: Y = 1,072 years.
      Depreciation Rate: 0.2%: Y = 1,608 years.
      Depreciation Rate: 0.1%: Y = 3,218 years.
      Depreciation Rate: 0.09%: Y = 3,575 years.
      Depreciation Rate: 0.08%: Y = 4,022 years.
      Depreciation Rate: 0.07%: Y = 4,597 years.
      Depreciation Rate: 0.06%: Y = 5,364 years.
      Depreciation Rate: 0.05%:Y = 6,437 years.
      Depreciation Rate: 0.04%:Y = 8,046 years.
      Depreciation Rate: 0.03%:Y = 10,728 years.
      Depreciation Rate: 0.02%:Y = 16,093 years.
      Depreciation Rate: 0.01%:Y = 32,188 years.
      Depreciation Rate: 0.0032188% = 100,001 years.
      Depreciation Rate: 0.001%:Y = 321,886 years.

      Note that I’ve carried this far farther than would normally be needed, to accommodate realistic building lifespans, simply because magic in Fantasy campaigns (and superhero campaigns!) can have unusual applications. You want a dungeon to be 2000 years old? A depreciation rate of 0.05% means that it’s a crumbling ruin (perhaps granting access for the very first time), 0.025% means that it’s still got 1600 years or so on the warranty.

      Predetermined Lifespan, derived depreciation rate

      This is arguably the more useful value, though – one in which you pick a lifespan and calculate a depreciation rate to match.

      The formula is

      D = 100 – 10^[2 + (-1.39794 / (Y-0.5))]

      Note that the “-0.5” is needed to correct a rounding error.

      Unfortunately, this is a little more complicated than the previous formula. Again, I’m only going to show working for the first example.

      Y=10: D = 100 – 10^[2 + (-1.39794 / (Y-1))]
           = 100 – 10^[2 + (-1.39794 / (9.5))]
           = 100 – 10^[2 + (-0.1471516)]
           = 100 – 10^[1.85285)]
           = 100 – 71.26 = 28.74%.

      Y=15: D= 19.91
      Y=20: D= 15.22
      Y=25: D= 12.31
      Y=40: D= 7.83
      Y=50: D= 6.30
      Y=80: D= 3.97
      Y=100: D= 3.18
      Y=120: D= 2.66
      Y=150: D= 2.13
      Y=200: D= 1.601
      Y=250: D= 1.282
      Y=300: D= 1.069
      Y=400: D= 0.802
      Y=500: D= 0.642
      Y=750: D= 0.429
      Y=1000: D= 0.322
      Y=1500: D= 0.214
      Y=2000: D= 0.161
      Y=2500: D= 0.129
      Y=3000: D= 0.107
      Y=3500: D= 0.0919
      Y=4000: D= 0.0804
      Y=5000: D= 0.0644
      Y=10,000: D= 0.0322
      NB: doubling Y has halved D – a useful shortcut!

      Y=20,000: D= 0.0161
      Y=50,000: D= 0.0644
      Y=100,000: D= 0.0322
      Y=200,000: D= 0.00161
      Y=500,000: D= 0.000644
      Y=1,000,000: D= 0.000322
      Y=10,000,000: D= 0.0000322
      Y=100,000,000: D= 0.00000322
      NB: increasing Y by a factor of 10 divides D by 10 – another useful shortcut!

      Again, I’ve carried this table of results to ridiculous lengths to accommodate the most outrageous concepts. 100 million years ago, Earth was right in the middle of the Cretaceous period (66-145 million years ago); the dinosaurs of the era were reaching their peak in size, including Argentinosaurus and Patagotitan, which may be the largest land animals in history.

      Armenian stamp depicting Argentinosaurus

      This stamp from Armenia depicts Argentinosaurus in what is believed to be its natural environment (most artists focus on the later days when Velociraptors and T Rexes were about). And yes, a number of the ‘creatures’ depicted in the Jurassic Park movies were actually from this period. Image Credit: Post of Armenia, Public domain, via Wikimedia Commons (Summary of relevant Armenian Copyright law on the file page)

      There was little or not ice at the North or South poles; at some points in the period, sea levels were 170 meters higher than today.

      So that’s the sort of timescale we’re talking about with later entries on the table.

    Vehicles

    Cars can lose 58% of their value in three years, 49% in four, and 40% in five, according to Wikipedia. And right away, there’s a logical problem – those numbers might be what the value drops to, but there’s no way that’s a reasonable depreciation statement.

    Ramsey Solutions (credit where it’s due) suggest 9-11% value loss the minute you drive it off the lot, 20% value loss in the first year, then 15-25% from that value each year until the 5-year mark – with no indication of rates beyond that. Other sites peg the rate at the maximum 25% thereafter.

    Working vehicles presumably go down in value faster, because they are on the road more often and hence running up greater risks and wear-and-tear. Heavy vehicles would also suffer increased depreciation relative to passenger vehicles.

    Boats – modern ones – lose 15-25% in their first year but then drop by smaller amounts until the 6th-8th year, when they are worth about half the replacement cost. After this, they decline in value quickly – 20-30% per year.

    But would the rate be the same for a Spanish Galleon? Or a Viking Longship? I doubt it. As with buildings, you should base your numbers on a realistic assessment of intended lifespan, bearing in mind that it’s inherently wasteful to have a vehicle that lasts longer than its date of obsolescence.

    Aircraft lose 5% to 20% per year, depending many factors including type, condition, and market demand, according to Latitude 33 Aviation. According to Forbes., 5-7% per year is typical, rising to 10-15% if heavily utilized. Since condition would be a reflection of usage and maintenance, that means that the remaining two factors – type and demand – must account for the other 5%.

    Spacecraft — who knows? I’d probably use aircraft numbers.

    Mines

    Mine value depends on how much ore is delivered in a year, multiplied by the value given its purity, less the costs of extracting that ore, of transporting the ore safely to a market, and possibly less the costs of refining the ore.

    Use the building depreciation techniques to decide how long it will be before the mine “plays out” – which may not mean that there’s no more ore, just that it’s more expensive to dig out than it’s worth.

    Costs will rise with every year of production, which is the source of most of the “depreciation”.

    Do some research on the value of precious metals and how they change over time. This is always useful info to have, but can be critical in valuing a mine.

    Finally, note that there can be a world of difference between how long a mine is expected to be productive and how long it actually makes a profit – with the value of the ore one of the biggest factors, and the value of labor as the other.

    Simple Businesses

    Businesses can be the most complicated assets to value, so I make them the simplest – they cost X, they make Y per year, and they will last as long as the business, its facilities, and its products are in contemporary demand.

    That last is a key point – most of the impacts on demand will blindside a business. Public tastes can shift unexpectedly, new technological innovations, rivals undercutting profits, loss of reputation, government regulation, and a dozen other possibilities can all spring from out of nowhere.

    If the management and product development teams are on the ball, they can adapt with new products and the issue become a minor hiccough in corporate history – but the older a corporate entity is, the harder it is to maintain that flexibility.

    As a general rule of thumb, a business should be worth the value of the buildings (depreciated for age), plus the value of the installations, plus a year’s wages for the whole company, plus five years of expected profits, less taxes to be paid in that period, and less any other liabilities.

    This will almost never be an accurate reflection of the share value multiplied by the number of shares issued (in a public company), even though the two are theoretically identical. There are traders out there who make their living exploiting the difference.

    Another key point is to ensure that ownership is a hassle commensurate with the profit levels. How big a hassle that is, is up to you. If it’s too much, the player has grounds for complaint; if it’s too low, it’s giving the player an in-game advantage.

    Of course, this will not be a constant – misfortune and headaches routinely come in bunches. The longer smooth sailing persists, the more paranoid the owner has reason to be.

    Livestock

    Livestock are – if fed, watered, and cared for – money on the hoof. The life of any single beast is one of appreciating in value until adulthood is obtained, then declining value (except in the case of stud value). But to convert the potential value into reality, you generally have to get them to market – and that travel is quite capable of depreciating the value significantly.

    But, when you accumulate a number of head, all this tends to even out into seasonal highs and lows, and sometimes specialist breeds and schedules can take advantage of periods of higher demand and lower supply.

    There will be some natural depreciation, too, in the form of accidental deaths and criminal acts.

    In modern times, profitability is a bare minimum over time; livestock are often a debt trap that can never be escaped. You are too dependent on everything going right over a significant period of time in order to achieve full potential profitability. That was less true prior to the mid-war interval, and far less true before the industrial revolution.

    Old Valuables

    Jewelry and the like from long ago neither appreciates much nor depreciates much. Most of the value is usually inherent, in other words, though social factors can still play a major role. There are fads in the jewelry market, the same as any other. There may also be some owner recognition that adds a little cream on the top.

    What is likely to increase with age is rarity. Because of the potential to melt unwanted pieces down and rehouse gems, this is going to be a relatively slow increase.

    What you do have to watch out for is the impact of supply and demand – if supply goes up, the value of past extractions goes down, and vice-versa.

    Quite often, the base prices are adjusted to compensate for inflation, so that’s one headache you don’t have to deal with.

    Old Rarities

    Ah, the value of old furniture. I was discussing the Quora answer linked to earlier with my Pulp Co-GM, and pointed out that the perception of such antiquities always increasing in value was baked into both our experience banks – we were quite literally in a brand-new world if the story were true.

    But here’s the truth – up until the mid-to-late digital age, once past the 50-year decline, furniture will still appreciate in value, so the old experience remains valid, and – in the longer term – the market will correct itself, as I suggested earlier..

    Things get more interesting when you’re talking about antiquities of little inherent value but vast value from other sources. A signed order by Julius Caesar, for example – how much is that worth? The Ostracon described earlier?

    These can essentially be treated as furniture without the value cliff that actual furniture has fallen down – at least somewhat. So you have a Ming Vase? It will go over the cliff, but make a soft landing, because (1) they tend to be very pretty, and (2) people will speculate that the value will eventually rebound. Quality will become more important – the better an item, the faster it is likely to rebound.

    So the question becomes, where is the level of that soft landing? I would suggest that it’s between 20 and 30% of the peak value if the item has intrinsic attractiveness or historical or social or religious value, and 10% if it lacks all of the above – and half that much if its not pretty to look at.

    Cultural Relics

    It’s the same story with cultural relics, except that these are likely to be even slower to rebound, because they are often less visually-attractive. Other factors can make up the difference, though.

    A huge differential will be whether or not the culture still exists – if it does, there will be an ongoing supply that will water down and slow any recovery (but which may have mitigated the decline in the first place); if not, finding more is increasingly unlikely with every year that passes, and so rarity will restore the value more quickly.

    Artworks

    I’ve talked about art elsewhere, but it’s worth reiterating: A painting that was $20 at the time of painting can be worth $200,000,000 today. Most of them aren’t.

    Pick an artist who’s right for the time of painting – google can be quite helpful – then do a search for “Value of works by [name]” and proceed from there.

    In a fantasy or future-set campaign, where artists and art movements generally have to be invented out of whole cloth, pick somebody to be a doppelganger and translate their careers into suitable events and terminology.

    Don’t neglect the impact of historical influence in making this decision; if there was a war twenty years ago in your canon, pick an artist from a period about 20 years after a major conflict.

    I also suggest that you use artists you’ve never heard of, saving those with name-recognition cache for when you need them specifically. How much more valuable will a Rembrandt be, should one survive, 100,000 years from now?

    Basic Valuables

    Your basic valuables won’t change very much from Inherent to Appraised value. The possible exception lies in social factors.

    It is equally important to note where the character is attempting to buy or sell an item – location can have a profound impact on demand, which in turn has a profound impact on value.

    Mementos & Personal Treasures

    These will have (relatively) colossal sentimental value, which is just as well because they are otherwise fairly valueless – until the character that owns them starts getting name recognition and fame, or gets mixed up in historical events. Once that happens, they can start acquiring historic value beyond the base.

Genre Notes

Heading for the home stretch, I have some general advice for the way different genres should handle their economics. I’ll try to keep these brief.

    Fantasy

    According to the US Treasury Department,

      Depreciation accounting, as we recognize it today, began in the 1830’s and 1840’s with the advent and growth of industries employing expensive and long-lived assets. Railroads, in particular, were concerned with problems of accounting for the deterioration, repair, and replacement of plant and equipment.

      OTA Paper 64 – A History of Federal Tax Depreciation Policy (PDF)

    Which means that prior to the beginnings of the industrial age, values were deemed inherent – even when that wasn’t the case. Rarity, Social and Religious factors, the fame of past owners – these would still have been relevant even in that era.

    To the greatest extent possible, keep your economics as simple as you can, at least until your campaign reaches the politics / strongholds phase. Use the system to set a value for possessions, but don’t break it down for the players. “It costs X, you think it’s worth Y” is as deep as you should go.

    Pulp

    The economics of Pulp are also better served by not bothering as much as possible. Value specific assets to get replacement costs, and to put dollar values on items where that’s likely to be significant – if something is to get stolen, for example – but beyond that, hand-wave as much as you can get away with. A thug, a mugger, or some unexpected light relief can often distract from impertinent questions.

    Historical / Detective

    These days this includes everything from a Hill Street Blues campaign to Sherlock Holmes. Because these tend to be a lot grittier, pay closer attention to lifespans, unusual wear-and-tear, and depreciation for everyday objects, while cherry-picking the occasional bauble to get the full treatment.

    Modern

    Modern-day settings tend to be a half-way house – there are some things that need to be valued fully, but a lot of it can be dumped into generic categories and assessed en masse. Don’t worry about individual pieces of unexceptional furniture, for example. Pay closer attention to vehicle values, those are something that most motorists are keenly aware of. And the value of homes. And the net worth of Businesses. Most of the rest can largely be hand-waved.

    Of greater import are the political and social ramifications of economic changes, especially those of things like energy and fuel.

    Superheroics

    Superheroics can deal with extremely unusual objects on a regular basis. How much is a captured force-field generator worth? So some specific valuables will need to be given the full evaluation treatment. Beyond these objects rare or valuable, though, the Space Opera rule should apply as much as possible (with exceptions) – there’s always enough money.

    More significant is the impact of superhero activity on the economy of others. DON’T beat your players over the heads with this, because it can get both boring and in the way of the fundamental premises of such campaigns – but subtly hint at it from time to time. What’s happened to the price of coffee and a danish in Superhero City lately? IF a character is renting, what’s the movement on the rental market? You get the idea :)

    Steampunk

    I still know less about the Steampunk genre than I like, though I’m addressing that.

    If a possession is being supplied by a corporation, probably on loan for some specific purpose, there’s always enough money.

    When it comes to personal vehicles, there’s always enough money – within reason.

    Those at the bottom rungs of society may be Victorian or Georgian in the impact of the economy on their lives. Be harsh in a Dystopian variant, be generous in a Utopian one.

    Governments are somewhere in between. Expect them to have greater outlays than is historically accurate, but they will also have greater incomes.

    In general, the economy should proceed at the speed of plot.

    Cowboy / Western

    Depreciation is all-important. Everything is running down the clock – mines, livestock, fences, farmhouses, businesses. Poverty will be everywhere to some extent – and there’s always a strong implication that the only exceptions require villainy. But always, there is hope.

    Sci-Fi – near future

    Treat as modern. Extrapolate as necessary – if there’s some new wonder-gadget, treat the situation as analogous to the introduction of some other tech, for example the iPhone. Broader economic strokes will frequently be necessary, but try hard not to get too bogged down.

    Sci-Fi – Dystopian

    The bad guys always have enough money and resources, unless the good guys specifically block something. Depending on the variety of Dystopia, good guys may have practically nothing and that badly deprecated, or they may have moderate resources that they have to leverage. Money (or trade goods equivalent) will usually be in short supply and will need to be carefully valued. Be careful about giving away too much loot, and remember the second part of the basic rule – an asset is only worth as much as someone can afford to pay for it, no matter how much they might value it or want it.

    Sci-Fi – Utopian

    The space opera rule broadly applies, and what restrictions might exist are dependent on restrictions other than material scarcity. That can fundamentally impact on the inherent value of a possession.

    Pirates / Swashbuckling

    Loot loot loot – any questions? You weren’t going to buy that ship were you?

    Supplies and treasures need to get the full treatment. For everything else, there’s either enough money or nothing at all.

Synthesis: A general process:

Okay, it’s time to wrap the whole series up with a general process that I recommend using – preferably during campaign creation, but its better late than never.

  1. Use the period notes to get your mind into the perceptions of the time.
  2. Adjust this core perception for genre
  3. Determine the Intrinsic Value using the worksheet
  4. Adjust for Appraisal Factors using the worksheet
    1. Use the period notes to get your mind into the perceptions of the time.

    What matters to the people? To the government? What are attitudes to economic matters? What’s changing, and where are efforts going? What’s more important (if anything) than the economy?

    2. Adjust this core perception for genre

    Since I’ve just run through the genre notes, this should be fairly self-evident.

      2a. Sidebar: On Old Problem – currency conversions and historic currency values

      Here’s a conundrum:

           USD 2023 to USD 1930 = / 18.43
           USD 1930 to AUP 1930 = x 0.2055

           USD 2023 to AUD 2023 = x 1.58
           AUD 2023 to “AUD 1930” = .x 01198
           AUD to AUP at currency changeover = / 2

      The above are all verifiable facts.

      If something cost, say, $200 USD 2023, how much would it have cost in Australian Pounds (we decimalized in 1966)?

      Path One:
           USD 2023 -> USD 1930 -> AUP 1930
           = 200 / 18.43 x 0.2055 = 2.23 AUP

      Path Two:
           USD 2023 -> AUD 2023 -> “AUD 1930” -> AUP 1930
           = 200 x 1.58 x 0.1198 / 2 = 18.9284

      Both can’t be correct, and the difference is too much to ignore. So which one is correct?

      In the Pulp campaign, we’ve had to confront this problem, in both directions, on more than one occasion. The difference stems from the inflation rate differing between the two countries over the years. That says to my co-GM and I that the problem lies in the combination of a fixed 1930s exchange rate and the “AUD 1930” value.

      USD 2023 -> USD 1930 = 200 / 18.43 = $10.85, and apply the fixed conversion rate of the era to get Australian Pounds – x 0.2055 = 2 pounds 2.76 shillings, call it 3 for convenience.

      You will confront similar problems whenever you have a value in one currency that a character wants to spend in another – do you start with the historical value, adjust for all the Valuation Factors, and only then convert to the target currency (Path 1)? Or do you convert the historical value and then adjust for all the Valuation Factors (Path 2)?

      In theory the two end up in exactly the same place, but I don’t think they do, because of the psychological impacts of small amounts vs larger amounts. I recommend path 1 as the one with the fewest problems, but whatever you choose, make sure that you are consistent about it.

    3. Determine the Intrinsic Value

    Once you’re seeing the valuation process from the point of view of the economic model that you have chosen for your campaign setting, as modified by the genre,

    Use random values as inspiration as you feel necessary.

    4. Adjust for Appraisal Factors using the worksheet

    The intrinsic value could be a major component of the final valuation or it could be largely irrelevant. If it’s important, made doubly sure that it’s correct and then apply the Appraisal Value factors. If it’s not, spend that extra time making doubly sure of your Appraisal Value factors.

    Focus on what’s important, in other words.

    5. The final adjustment: GM Fudge

    The ultimate purpose of the worksheet isn’t to give fixed, absolutely correct, answers, it’s to guide your thinking. Ultimately, the value of any object or possession in your campaign is whatever you think it should be – under the current circumstances.

    Those circumstances include the in-adventure status, the in-genre foundations, and the campaign background. But those are fairly broad concepts and sometimes hard to narrow down to specifics. That’s where the worksheet can help – getting you to think about a reasonably comprehensive suite of variables in isolation, undistracted.

    At the very least, round off to something practical!

The End Of An Epic

Hey Ma, I made it – Top Of The World! Well, bottom end of the series, anyway.

Reactions have been mixed so far – some people have praised the whole thing (even hoped that I could extend it backwards to cover Classical civilizations); others have found it too long, or too detailed – most of them not having read the whole. And there have been a few that liked some parts and not others.

Hopefully, it’s now clear what I’ve been drilling toward all this time, permitting re-evaluation of those parts that didn’t grab a reader. It’s been an epic journey of 160,000 words or so, but I think it’s been worthwhile!

What was the 17th and final post in this series, the Asset Valuation Worksheet 2.0, has now become the kickoff post for another series. If you’re looking for it, your can still find it here: Asset Valuation Worksheet 2.0.



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