Supply and Demand
This was inspired by Ysharros’ recent post about crafting.
I find it interesting that auction houses in MMOs mostly still adhere to the eBay model, which is entirely supply-driven, when there’s a clear argument for a demand-driven model as well. That is to say, if you have something you want to sell (a supply of something), you can post it for sale, generally for a limited time, and generally there’s a posting fee involved. But if there’s something you want to buy (a demand for something), and nobody has put it up for sale… you’re out of luck. This is obviously a bit silly.
I always get involved in economics in MMOs, and I’ve quite often found myself perplexed by the supply-only model. That’s not the only approach in existence though – CoX for instance has both supply and demand auctions. In fact, a while ago when I went back to CoX to try out the CoV content, I hit the auction house lottery jackpot… I put something up for auction (supply) and found to my delight that someone else had previously posted a demand for that item for a fairly ridiculous sum of money (ridiculous to me anyhow). As it turned out, the item was of considerable rarity, but I had no idea of that when I put it up for sale. I made a lot more money there than I was asking for.
There’s a strong argument in favor of full transparency for demand postings – that is to say, every demand that’s posted should be searchable and completely visible to the public. If e.g. I know that someone has offered outrageous sums of money for something, then I might reasonably seek to acquire or create the item myself, so I could sell it for said outrageous sums. CoX’s auction house has an opaque demand system… so I, as a seller, can’t see exactly what people are offering for various items; instead, I can only see what the last 3 of those items have sold for, and I have to guess what a good price is. This leads to an interesting but unnecessary and unfulfilling metagame where people try to figure out how much to sell things for. A more fulfilling and natural system would allow us to see what the actual demand is, so selling prices can meet the demand. This becomes fairly fundamental when selling crafted items… since I, as a crafter, would like to make the items I know are more valuable to my local economy, and spend less time creating things that have little value. As a consumer, having demand postings means I can seek the items I desire more readily, instead of having to check back at the auction house regularly to see if someone put it up for auction.