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Old 02-28-2015, 09:39 AM   #1
johndallman
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Join Date: Oct 2010
Location: Cambridge, UK
Default [Basic] Skills of the week: Economics, Finance and Market Analysis

None of these skills are TL-dependent, and they don't take Cultural Familiarity penalties, but there's a case to be made for familiarity penalties in societies significantly different from the ones you learned them in (IW, p.181-2). Innumeracy is crippling for all of them. They don't get a huge amount of attention, in most games, but even GURPS grognards don't play Papers & Paychecks very much.

Economics is the IQ/H theory of markets, financial systems and money in general. It has lots of defaults (IQ-6, Finance-3, Market Analysis-5 and Merchant-6), and Finance and Market Analysis, plus Geography (Political) have defaults to Economics. As well as being an academic subject, it is a useful supporting skill for high-level military planning (usually Strategy) and Intelligence Analysis, and thereby for ruling any kind of domain. Finally, you can try to predict the economic effects of events with a skill roll.

Economics is a somewhat common template skill for educated businessmen and social sciences types, but there's something of a lack of material about Economics skill in world-building in the GURPS PDFs I have, except for Space. PU3: Talents has three examples that include Economics, and Social Engineering has more uses for the skill. Optional specialisations, in the kind of economics endorsed by particular political systems, seem plausible, although people with such a specialisation may claim they're specialised in the parts of the subject that work, not a politically determined subset.

Finance is the IQ/H practical skill of managing money; it's the equivalent of Engineering if Economics was Physics (and Accounting is presumably the equivalent of Mechanic). Bankers and financiers use this to do things, and Accounting to keep track of the details. It defaults to Accounting-4, Economics-3 or Merchant-6, but has no IQ default. Accounting, Economics and Merchant have defaults to Finance. B474 has an example of using Finance with the invention rules, to get funding.

Like Economics, Finance appears on a reasonable number of templates, and is a core skill for businessmen and politicians at any TL with developed trade and tax systems. PU3: Talents and PU7: Wildcard Skills each have a couple of examples that include the skill. Social Engineering has a lot of uses for Finance. Specialisations in particular aspects of Finance seem sensible, although I can imagine quite strange ones in some settings.

Market Analysis is the IQ/H skill of understanding the short-term behaviour of stock, bond and currency markets. Long-term behaviour is probably a specialisation of Fortune-Telling. It seems like Electronics Operation: a highly specialised practical skill, that's based in the ideas of Economics (as Electronics Operation is based in Physics) but where most of the practical skill is in understanding the specific market (equipment) and the behaviour of the things connected to it. It defaults to IQ-6, Economics-5 or Merchant-4, and Economics and Merchant have defaults to it.

The presence of Market Analysis on the Merchant template in Banestorm suggests strongly that Market Analysis also applies to commodity markets, which makes sense. Apart from that, Market Analysis appears on several templates, and PU3 and PU7 have examples that include it. Powers gives +4 to skill for use of Precognition. Thaumatology: Urban Magics points out that in societies or subcultures where markets are very important, this skill can be used in place of Current Affairs (Business).

I don't think I've ever made significant use of these skills in a game. But I know several participants on these have studied Economics. What have you done with it?
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Old 02-28-2015, 10:52 AM   #2
whswhs
 
Join Date: Jun 2005
Location: Lawrence, KS
Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

I'm currently running a fantasy campaign where the PCs are the co-owners and managers of a merchant sailing ship. Of course Merchant is an important skill for trading and choosing things to trade. But I'm asking for Finance if they want to do things like raising money to upgrade their ship's stores, or do major repairs or improvements, or perhaps someday buy a new, bigger ship, or borrow money for any of the above. Finance is the skill you use for "We have this venture we want to undertake; give us money!"

I don't really use Market Analysis; it's hyperspecialized, even though I agree that it's the right skill for commodities traders. But I don't think it really comes into play much below TL5. (Joshua Norton's career, for example, was marked by a critically failed Market Analysis rolls!)

Economics seems to me to be mainly an academic skill. You could use it to predict the consequences of a law or an economic policy, I expect, or to understand a new culture's economic system, subject to penalties. . . .
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Old 02-28-2015, 11:58 AM   #3
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Join Date: Apr 2006
Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

Ugh, now here is some skill bloat. Yes, all these fields are related-but-distinct in real life, but I imagine that less than one game in 10000 rewards separate investments in these skills and has players and a GM that actually enjoy the distinctions.

If it were me, I'd just have Finance. Economics becomes an Expert skill and is mostly good for flavor or complementary rolls, and Market Analysis is something you do with Finance if it Matters (i.e. you're making money with it) or Economics if it doesn't. Interskill defaults with Merchant should be stingy or nonexistent; being a good horse trader doesn't make you a financial whiz and vice-versa, and Merchant is already a bit of an überskill.

Oh, I did have a financial whiz PC once, but I don't think the GM was on board with the concept (despite approving the character) so it was rather unsatisfying.
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Old 02-28-2015, 12:09 PM   #4
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Join Date: Feb 2005
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Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

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Originally Posted by Xplo View Post
If it were me, I'd just have Finance.
I'd probably not even have that -- Economics would become a Science (or Expert) skill, Finance and Market Analysis would both be specializations of Merchant. Yes, Merchant is an uberskill, but outside of rather specialized trading games, that's not a big deal.
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Old 02-28-2015, 12:13 PM   #5
whswhs
 
Join Date: Jun 2005
Location: Lawrence, KS
Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

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Originally Posted by Xplo View Post
If it were me, I'd just have Finance. Economics becomes an Expert skill and is mostly good for flavor or complementary rolls, and Market Analysis is something you do with Finance if it Matters (i.e. you're making money with it) or Economics if it doesn't. Interskill defaults with Merchant should be stingy or nonexistent; being a good horse trader doesn't make you a financial whiz and vice-versa, and Merchant is already a bit of an überskill.
Market Analysis could certainly be disposed of; if it's needed at all, it should be a technique of Merchant.

I would not make Economics an Expert Skill. The general principle of Expert Skill is that it refers to bodies of factual knowledge; in fact, Naturalist was a lot like an Expert Skill before the concept was thought of. But economics as a field is focused on theory and on methods of theoretical analysis. That's why economic methods can be exported into such domains as game theory and public choice and the economics of everyday life. Or, far earlier than any of those, to biology, by Darwin and Wallace. It's quite comparable to the export of thermodynamics into chemistry and biology and climatology.
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Old 02-28-2015, 12:56 PM   #6
Anthony
 
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Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

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Originally Posted by whswhs View Post
I would not make Economics an Expert Skill.
It would be nice to have a category for Science skills, but it still fits basically the same game role as an expert skill, in that it's mostly analytical rather than applied.
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Old 02-28-2015, 01:20 PM   #7
Overheat
 
Join Date: Nov 2014
Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

Take this post with a grain of salt, as I am an Econ major with a job in accounting oversight, so the differences in money skills seem like large chasms to me.

I have had a character that had all these skills, but only off a Merchant default. I used Economics and Finance a couple of times to help a business that we were running, but never Market Analysis.


Economics deals with the academic, but the examples they give seems to me like it might be to deal with macroeconomics and general theory of how labor, capital, money, and prices all work together. It seems to be the skill of calculating GDP, and knowing economic principles like how to calculate the optimal level of savings for maximum economic growth.

What I would call microeconomics seems to be the finance skill- firm level money decisions. The optimal price to charge for a monopoly good would probably be rolled Finance, even though in college you learn that in economics classes. Not only that, but also Finance is setting a budget, discounting future cash flows, and estimating the profitability of a planned project. Everything you need to run a business money-wise, assuming you can find someone with Accounting to put that all in your general ledger so the SEC and IRS will be satisfied.

Not having an IQ default is probably good, as unlike Economics, you do not really "see" Finance happen in everyday life, like you would "see" economics happen all around you. Accounting does have an IQ default, but people who have never even heard of double entry bookkeeping could probably manage a single entry system for a small business if they used Extra Time.

That leaves Market Analysis. Economics skill will tell you how the market will move from large economic incidents, but the day to day would be this skill. Figuring out how much a common stock will drop in price after the dividend date is this skill. Knowing (or estimating) what would be the best securities to buy/sell/short would fall under this skill.

What annoys me about Market Analysis is that determining current trends is very easy, anyone with Computer Operation would be able to do that. Unless it is referring to determining what sort of trends you might see throughout the whole current trading day. Since you are not sure about whether you might have had a critical failure, you cannot just go with extreme leverage to make money based off your intuition, which seems fair.


I like having the money skills all be separated out. If people really did duke it out with 300 point accountants and financiers, then having this level of detail would allow for interesting occurrences, rather than see who can roll better on the Money! skill.
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Old 02-28-2015, 03:11 PM   #8
Xplo
 
Join Date: Apr 2006
Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

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Originally Posted by whswhs View Post
Market Analysis could certainly be disposed of; if it's needed at all, it should be a technique of Merchant.

I would not make Economics an Expert Skill. The general principle of Expert Skill is that it refers to bodies of factual knowledge; in fact, Naturalist was a lot like an Expert Skill before the concept was thought of. But economics as a field is focused on theory and on methods of theoretical analysis.
Who cares? "Methods of theoretical analysis" are facts.

Chemistry lets you cook acids and explosives. It's useful.

What do you cook with Economics?
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Old 02-28-2015, 03:17 PM   #9
Xplo
 
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Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

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Originally Posted by Overheat View Post
What I would call microeconomics seems to be the finance skill- firm level money decisions. The optimal price to charge for a monopoly good would probably be rolled Finance, even though in college you learn that in economics classes. Not only that, but also Finance is setting a budget, discounting future cash flows, and estimating the profitability of a planned project.
I'd also throw knowledge about banks, investment vehicles, etc. in there. If you want to understand securitization or credit default swaps, you want Finance.

Quote:
I like having the money skills all be separated out. If people really did duke it out with 300 point accountants and financiers, then having this level of detail would allow for interesting occurrences, rather than see who can roll better on the Money! skill.
I guess you're #10000. Or, more charitably, my estimate is wrong.
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Old 02-28-2015, 03:53 PM   #10
Overheat
 
Join Date: Nov 2014
Default Re: [Basic] Skills of the week: Economics, Finance and Market Analysis

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Originally Posted by Xplo View Post
I'd also throw knowledge about banks, investment vehicles, etc. in there. If you want to understand securitization or credit default swaps, you want Finance.


I guess you're #10000. Or, more charitably, my estimate is wrong.
Yeah. If something hangs in the balance about whether your character knows the difference between the fed funds rate and the discount window rate, or how to rate the value of a voluntary corporate action, then Finance is right up your alley.

If one of these skills has got to get the ax, Market Analysis seems the least likely to come up in an adventuring situation. Basic Set even mentions that it is used for the purposes of making money. Offscreen money makers tend not to be the best for a tabletop RPG.

The problem that I see with axing Economics is that it is actually useful in an RPG setting if you are running a kingdom or country. The guy in charge should know a thing or two, and have people on staff dedicated to the subject.

Not only that, Economics is good for explaining the past and why things happen. I see it as at least a skill like History or Philosophy. You will never use those to get out of a locked room with a bomb in it, yet I do not think anyone wants to kick out History.
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