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Old 09-14-2017, 08:37 AM   #1
Michael Thayne
 
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Default [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

I'm interested in attempting to extend the economics rules in Low-Tech Companion 3 to TLs 5-8. I suspect this becomes significantly more complicated, due to fine-grained division of labor, complicated supply chains, etc. but those very facts make such a project useful, since LTC3 can't just be used for higher TLs as-is.

Campaigns has nice one-paragraph rules for setting up production lines:

Quote:
To set up a production line costs 20 times the retail price of the item. The production line makes one copy of the item in 1/7 the time it took to build a prototype or in (retail price/100) hours, whichever is less. Each copy costs 20% retail price for parts, or 50% for parts and labor.
This seems like it gives non-insane results when you have nothing else to go by, but I suspect is not terribly realistic. I'm pretty sure many production lines will cost more than 20 times the retail price of the item. Ultra-Tech p. 89 expands on these rules slightly, allowing that larger production lines will let you work faster. UT also declares that small devices take longer, which seems like it should drive their labor costs up in ways that create inconsistencies. For example, the rules suggest a $200 computer chip would take 40 person-hours to make, but unless the workers at the fabricator plant make significantly less than $5 an hour, the chip will cost more than $200. Better rules for chip fabs would be very helpful.

Another issue is that many items will see more than a 100% markup from production cost to retail cost. High Tech notes that if you buy AK-47s in bulk from the factory, they cost around $90, but gives the retail price at $450. Actual markups for a variety of items could be very useful for designing better rules, OTOH maybe that's not worth worrying about if we're going for the level of resolution in LTC3.

A final issue is that none of the existing rules seem to account for worker productivity increasing by TL. LTC3 already avoids this (see Labor Costs, p.23) and LTC3's approach is probably what we'll want to use here.

A big issue is getting greater clarity on what "parts" mean. That hides a lot of potentially important detail, in terms of e.g. number of steps from raw material to finished product. Would be worth researching real-life case studies of this, to get somewhat realistic rules.
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Old 09-14-2017, 09:34 AM   #2
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

My off-the-cuff suggestion for chip fabs is to treat them as multiple assembly lines: AMD spends $2B in the late 90s to build Fab 30, and Fab 30 is roughly 600,000 assembly lines for $200 chips running in parallel and can produce 8 million chips every 3 months, which is pretty close to what I remember as the standard output of Fab 30 without requiring extra shifts. And 600,000 assembly lines for $200 chips cost $2.4B, so the numbers work out pretty well.

If you treat chip fabs as multiple parallel assembly lines, you could also say that each worker is working multiple lines at once. A single silicon wafer gets etched with 400+ chips, so if that 40 hours of work produces 400 chips, you can pay him up to $1000/hour and still have 50% of the chip price available for materials, overhead, and paying fixed costs. Of course, fab techs make a lot less than $1000/hour, even in aggregate, but microprocessor chip costs are dominated by the fixed costs of the fabs anyway.

In the end, though, I suspect high-tech production rules are going to be a mass of special cases that are going to be based on specialist knowledge for each industry. One for instance would be microprocessor chips: while I can believe that it takes ~40 hours of labor to make a wafer, that labor is done in 15-30 minute chunks over 8-16 weeks. I don't know how you account for that in the rules or even if its necessary to do so.
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Old 09-14-2017, 10:04 AM   #3
Michael Thayne
 
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

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Originally Posted by mlangsdorf View Post
My off-the-cuff suggestion for chip fabs is to treat them as multiple assembly lines: AMD spends $2B in the late 90s to build Fab 30, and Fab 30 is roughly 600,000 assembly lines for $200 chips running in parallel and can produce 8 million chips every 3 months, which is pretty close to what I remember as the standard output of Fab 30 without requiring extra shifts. And 600,000 assembly lines for $200 chips cost $2.4B, so the numbers work out pretty well.

If you treat chip fabs as multiple parallel assembly lines, you could also say that each worker is working multiple lines at once. A single silicon wafer gets etched with 400+ chips, so if that 40 hours of work produces 400 chips, you can pay him up to $1000/hour and still have 50% of the chip price available for materials, overhead, and paying fixed costs. Of course, fab techs make a lot less than $1000/hour, even in aggregate, but microprocessor chip costs are dominated by the fixed costs of the fabs anyway.
Thanks!

Quote:
In the end, though, I suspect high-tech production rules are going to be a mass of special cases that are going to be based on specialist knowledge for each industry. One for instance would be microprocessor chips: while I can believe that it takes ~40 hours of labor to make a wafer, that labor is done in 15-30 minute chunks over 8-16 weeks. I don't know how you account for that in the rules or even if its necessary to do so.
I would not be surprised of microprocessors were an unusually unusual case. Lots of things can be made by casting, milling, stamping, etc. whereas microprocessors use photolithography.

Besides, the point is not 100% realism, just something gameable. Something detailed enough for games about revolutionaries who need to equip a whole army with untraceable guns, space colonists, or post-apocalyptic entrepreneurs. You might go for having one quick-and-dirty rule per major category of gear—Generic Chip Fab, Generic Gun Factory, Generic Car Factory, etc.
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Old 09-14-2017, 10:19 AM   #4
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

This study of the feasibility of a self-replicating lunar factory seems potentially relevant not just for space colonists but the post-apocalyptic scenario—sort of the minimum viable industrial settlement. It would take me some work to condense it into something gameable, though.
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Old 09-14-2017, 10:31 AM   #5
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

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Originally Posted by Michael Thayne View Post
UT also declares that small devices take longer, which seems like it should drive their labor costs up in ways that create inconsistencies. For example, the rules suggest a $200 computer chip would take 40 person-hours to make, but unless the workers at the fabricator plant make significantly less than $5 an hour, the chip will cost more than $200. Better rules for chip fabs would be very helpful.
Yeah, the "small items take longer" rule looks pretty dubious. Yes, fine detail tends to be expensive, but that's already accounted for via the price. This is double counting in a multiplicative fashion.

Quote:
A final issue is that none of the existing rules seem to account for worker productivity increasing by TL. LTC3 already avoids this (see Labor Costs, p.23) and LTC3's approach is probably what we'll want to use here.
This is true if you use existing job descriptions. If you build the jobs from scratch using the Typical Monthly Pay tables in Basic 517, productivity does go up with Tech level. You don't get the finely researched values, but I think High Tech won't have many of these jobs defined anyways.

But labor saving devices are a big deal here. You need some pretty expensive tools to do TL 7 labor, and they often have upkeeps higher than their operator's wages. How do you factor in the productivity of a man with a backhoe digging a ditch? So that's another issue, I suppose.

EDIT: but I suppose for manufacturing that's counted as part of the production line. Though I suppose you could apply it to digging holes... maybe? What's retail on a hole?
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Old 09-14-2017, 12:14 PM   #6
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

Quote:
Originally Posted by Michael Thayne View Post
I would not be surprised of microprocessors were an unusually unusual case. Lots of things can be made by casting, milling, stamping, etc. whereas microprocessors use photolithography.
One simple patch, and a reasonable extension of my thoughts on microprocessors, would be to have a lot of high tech items that could be made in job lots. You pay the labor and materials for the job lot, and you can make up to job lot individual items at once. If you make less, well, then it's just not very efficient. Job lot size varies by item, in the thousands for tiny things like paperclips and down to 1 for very large things like aircraft carriers.

So say the job lot size for a microchip is 400, and the microchip costs $200. It costs $200*400*20 = $1.6M to produce an assembly line for microchips, and it produces 400 at a time at a cost of 1/2 * 400 * $200 = $40K with 40 hours of labor. If you only need 300 microchips this month, it still costs $40K and 40 hours.

And if the job lot size for AK-47s is 10 and they cost $250 each, it costs $50K to set up an assembly line, and $1250 to produce a batch of 10. If you only need two AK-47s this month, it still costs $1250 to produce the two of them.

I'd approximate job lot sizes as 2000/unit price, minimum 1, with a x10 for in the job lot size for electronics. You might have to play around with that number but it's a place to start.
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Old 09-14-2017, 12:40 PM   #7
DouglasCole
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

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Originally Posted by mlangsdorf View Post
So say the job lot size for a microchip is 400, and the microchip costs $200. It costs $200*400*20 = $1.6M to produce an assembly line for microchips,
I know you're spitballing, but that seems quite low. Thinking about disc drives, my own industry, to process a wafer (with, say, 50,000 usable heads on it) will take something like $10-15M in capital to go from a finished wafer to singluated heads, maybe more. Disc drive heads are cheap relative to microchips, though the 50,000+ head wafer itself requires equipment that can cost $35M a pop. The photolithography tools are, per unit made, the most expensive. Vacuum dep tools are the most expensive per unit, at least in my line of work. The photo tools for microchips (deep UV and whatever) are probably most expensive both in a per-unit-made and per-machine-acquired basis.

You're in a better place, sounds like, than I am to think about real chips, but I'd guess that there should be some sort of cost multiplier that's applied on a "smallest feature" scale. A few tens to hundreds of microns is pretty easy at TL8, but my tolerances for deposition were measured in fractions of an atomic layer (maybe 1/10 the usual crystal lattice dimensions).

And it may be, again, that the ridiculously capable and very flexible microprocessor, as opposed to your usual ROM chip where it Does One Thing is a big deal.

I've only secured the purchase of vacuum, photolithography, and other clean room equipment for the disc drive head industry, but those are usually $1.5 to 6.5M each, and that's but one part of the process.
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Old 09-14-2017, 01:01 PM   #8
Michael Thayne
 
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

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Originally Posted by ericthered View Post
This is true if you use existing job descriptions. If you build the jobs from scratch using the Typical Monthly Pay tables in Basic 517, productivity does go up with Tech level. You don't get the finely researched values, but I think High Tech won't have many of these jobs defined anyways.
That's not actually what I had in mind. Campaigns and Ultra-Tech assume that 30% of the cost of generic manufactured item comes from labor of assembling the parts, and this takes 1 hour per $100 of value. So the assembly line worker is $30/hour! Worse, it doesn't change with TL.
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Old 09-14-2017, 01:35 PM   #9
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

It's worth knowing some ballpark prices for various raw materials. Don't take these too literally—they're intended in the spirit of High-Tech saying gas costs $1.50 per gallon. I didn't do anything fancy here, just Googled the prices of these alloys, converted 2004 dollars, and rounded off:
  • Aluminum: $0.70/lb.
  • Copper: $2.25/lb.
  • Lead: $0.75/lb.
  • Nickel: $3.90/lb.
  • Steel: $0.20/lb.
  • Tin: $7.00/lb.
  • Ferrotitanium Alloy: $2.80/lb.
  • Zinc: $1.05/lb.
These are fairly cheap compared to finished products. And commodity prices for lumber and plastics are even lower. This suggests labor costs will be a higher percentage of final costs than at lower tech levels. (Indeed, human civilization has gotten a lot more efficient at churning out iron and steel since the age of sail!)

For machines like guns, cars, and airplanes, I think the real question is to understand the minimum capital requirements for a supply chain, and what % of the wholesale cost that accounts for.
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Old 09-14-2017, 06:30 PM   #10
Michael Thayne
 
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Default Re: [High-Tech] GURPS Industrial Economics (building on Low-Tech Companion 3)

Poking at this further, I'm seeing things that say pretty much all machining these days is numerically controlled. So you can use the CNC systems from High-Tech for mechanical parts. Then use production-line rules for assembling the parts. This would also dovetail with what I've read about modern aircraft being expensive mainly because of their electronics.

OTOH I'm unclear on how much of modern factory equipment can be represented by the flexible CNC systems described in High-Tech. Obviously to the extent a factory can use that approach, it will, because you don't need new machinery when you get a new design for something. But I've also heard new car designs generally do require millions of dollars in new tooling. So not sure. Does anyone know about this area of manufacturing? Where is the line between general-purpose CNC tools and things that are specific to one model of an item?
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