Geekdom Come, World Building 101

World Building 101: Economics

As writers of fiction, we all have a particular part of our imagination we like to indulge the most. For some of us, that means spending hours on end crafting a sophisticated socio-political hierarchy for our new world. For others, it’s about creating wondrous mythical beasts or monstrous creatures born from a nightmare realm. While still others revel in inventing new types of technology or systems of magic. Very few writers get into the world building game because they love exploring the what if game of economics. I am one of those few. Which is why it is with great delight that I bring to you today’s installment of World Building 101: Economics.
The first thing to resolve is what I mean when I talk about economics. Economics is the study of choice. More specifically, it is the study of how we choose to allocate our limited resources; our capital, our labor, and perhaps most importantly our time.
There are myriad of economic systems to choose from but first, there are quite a few economic factors and concepts I’d like to point out for you that might influence your decision as to what kind of system you want to set up for the peoples of your world.
First, let’s cover intrinsic versus extrinsic value, also known as objective vs, subjective value. The idea here is that there are two types of commodities in economic transactions. The first are items with objective value; water, food, shelter. These are commodities that help you stay alive and healthy. Then there are commodities that have subjective value. An old teacup might be of little value to me but if its the last thing your grandmother gave you before she died it might be of great value to you. In fantasy realms, holy relics and royal antiques often fall into the extrinsic category.
The second thing you should think about is the technological level of your world. How does that technology affect productivity? Does it take a week to sew a pair of pants by hand or can your people make ten thousand pairs a day using replicator technology of some kind? What about transportation? Do your farmers have to take their goods to market on a cart, or can your traders move from galaxy to galaxy on a spaceship?
Finally, I want to talk about specialization of labor. If your world is divided up into separate peoples, tribes, nations whatever; the odds are that one group will be better at certain industries than the others. Either due to geography, labor surplus, or technological superiority. When a people enjoy such an advantage they tend to leverage it for maximum benefit. This usually creates a trade surplus and wealth for a people. It also creates a hole in their economy that can be filled by a neighbor creating a symbiotic trading partner that intertwines the peoples’ economies. Depending on the nature of that partnership it could create a spirit of friendship and cooperation or it could result in deep economic resentment. My advice here would be to work backwards from your primary settings. Establish what you need in those places for your story than game out how that might affect nearby villages, cities, and nations.
Okay. Economics is a whole academic discipline and there are certainly a myriad of factors that I haven’t room for here but I thought those were important items to cover for when you’re just getting started. Now that you have some ideas as to what factors might affect how your economy works. It’s time to go over economic systems.
Typically economic systems fall into four categories: traditional, market, command, and mixed. In traditional economic systems, economic roles are assigned by culture and tradition. Basically whatever your parents did before is what you do now. This is common in isolated agrarian tribes. A market economy allows the consumption habits of consumers to determine what shape the economy takes, allowing buyers and sellers complete freedom from government interference. A Command economy takes the opposite approach. In this system, a central governing authority sets prices, allocates resources, and dictates production. Finally, there is a mixed economy, where government and businesses work together to create a balanced system using elements from the market and command economic systems. Most western capitalist societies fall into the mixed category.
Hopefully, that gave you something to think about when you start building up your own world’s economy. Economics is a highly complex field. If you have questions, do the research. Better to double check something then realize five months after you published that a fictional economic collapse is imminent.

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