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LonewandererD
07-14-2010, 01:46 PM
Hello to all, I'm in the middle of building a small world of my own, or at least a small corner of it and wanted to know if you minded if I ran some ideas past the Guild. I know it's direclt map related and so i'm prefectly fine with this thread being deleted.

My idea directly relates to currency and trade and wanted to know whether my concept would create a society that is sustainable or not. The Dal people are at a stage in society similiar to medieval japan or pre-rennosciance europe (whichever was more advanced, my history of ancient times is a little limited), their technology has developed far enough that all the needs of their society are met and that new developments and inventions are slow as there is no real need for them at the current time. In Dal society an item's/object's worth is determined by it's practical value rather than a form of monetary (check spelling) value. So steel would have more value than gold as, even though the gold is rarer and desireable in most cultures, it has more practical uses e.g. if you're looking to outfit an army or a labour crew your not going to give them golden equipment with is heavy but soft when you can give them steel or iron equipment which is more readily available and more durable; gold is still are nice commidty amogst the high nobility who can afford it. So in Dal culture the more common raw materials, including food, have more worth. Trade in such goods is governed by weight, the goods are divided into units (each unit is about 20 pounds) and units are traded on a like-like basis, so 20 units of rice would get you 20 units of wood and so on. Haggling is a common practice as traders try to get more for their goods by bringing aspects like quality, work required to get the goods, importance and immediate practical use of the goods and so forth. So far my society can trade and deal without a currency system.

However this where I hit a snag, the whole trade of material and goods without money works well amonsgt people whose proffesional would actually bring them into a supply of such stuff but it does no good for people who have other professions like soldiers, labourers or house servants. So, in this case some form of currency would be required. I decided to go with a form of commodity currency instead of fiat currency as the Dal would lean towards having a form of currency that actually has some value, a farmer won't trade in his crop for some paper bills. The form of a currency in this case are small bags of rice or small coins made of iron or bags of iron sand, both are common in Dal society and have the most practical use, the rice can be eaten and the iron can be melted down into other objects. A emplyer would pay their employees in this form of currency, how much excatly depends on the job and is often negotiated before employment in the lower class. Employers can also be payed in food and shelter. Items can be bought with this currency by trading an equal weight of currency for the desired goods, so a sword would be really expensive while a new shirt might not be so expensive. Non-item services can be bought in this manner for a negotiated cost, or if possible services can payed in other services. Again, haggling is the norm.

So in Dal society, when dealing with large amounts of material and goods the unit system is used and when dealing with smaller goods or services the commidity currency is used. Trade offices are also located in each settlement with substantial trade activity to regulate these dealings and to help people convert raw goods into commodity currency and vica-versa. Would such a system seem feasible?


-D-

mearrin69
07-14-2010, 02:19 PM
I believe there's precedent for this in the real world. If I'm not mistaken, the Roman Empire used to pay its soldiers in salt (the origin of the word "salary", I believe). Currency comes about because it's difficult to carry bags of commodities around...and because it's prestigious to be able to mint coins with your face on them.

Edit: AND, in societies where the local currency has gone to pot, people still trade in commodities - during the Russian fiscal crisis several years ago people converted their paychecks to vodka because it held its value better than cash. I don't know, but I expect that people accepted vodka and other goods in lieu of cash during that time for the same reasons. The same situation has, I believe, occurred in many other parts of the world that have experienced runaway currency devaluation.

One suggestion: if units are related to weight I would suggest that x units of wood would not be equivalent value to x units of rice or x units of iron. Either there should be an exchange rate (20 units of rice = 1 unit of iron) or the weights should be different (1 unit of rice (20lbs) = 1 unit of iron (1lb)) for each kind of commodity. Services should have a value in commodity terms, e.g. one hour of blacksmithing is worth 0.25 units of iron, etc. This could all get pretty complicated because you'd need a big table showing the relationships between the various forms of commodities, services, etc. (another reason for creating currency).
M

Yandor
07-14-2010, 02:28 PM
Wow, good stuff if you ask me, but a few ideas popped into my head and maybe might point you in the right direction.

1. Soldiers - The city or who ever either A. are volunteers, or B. the town has a Tax of goods meaning for ever 20 units of rice 1 rice goes to the city storage kind of a deal, thus they get a supply for defending the city etc etc.

2. Healers, and other non material creators, along the same lines as a Soldier, but for their services they receive a payment of goods, its not like someone would want to screw a healer out of their payment if they are going to be dying =D. But also to address the servants, they should have lodging on the homes they work on, and because of the service they provide, the master of the house feeds them and lodges them, where on their own they probably wouldn't get anywhere (lack of skills maybe?) So in turn thats their payment unless they do some type of labor on the side or service to gain other materials for their needs/wants (outside of the masters stuff)

3. Has to do with the Iron, or bags of Iron etc. If its suppose to be equal or more than gold, and the area has a decent amount of it to be mined, those prospectors and miners are going to be your nobility. Cause if its fairly common, and super expensive, that means weapons and other trinkets are going to cost a fortune. You did express this, but I find it would still be hard to have a more "common" material be more than gold. But however if its scarce in the land and they must import it, now thats a totally different story.

Anyways just my 2 cents, might help might not... but good luck!

jfrazierjr
07-14-2010, 02:37 PM
What mearrin69 said.... regardless of if you use paper(dollars, trade notes, etc), metal(gold, silver, iron, etc), salt or whatever, you really should consider some form of currency as a standard index for trading. Even if two people are trading goods vs goods, it's still nice to be able to put a "price" index upon the things being traded have equal value by weight/volume. As suggested above, 20 lbs of rice should not be worth the same as 20 lbs of wood or 20 lbs of silver. While the rice takes a long time to grow, the time invested vs the harvest is very small (assuming an abundance of "seeds" and growing habitat as there would be here on earth.) Also notice that while rice is fairly inexpensive anywhere(thinking in our world) in most cases, it should be worth far more the further you get from the origination source. I would expect that you could make very little money selling rice in a city where there are hundreds of acres of it around and far more in a more arid region where there is not enough moisture for growing it.

mearrin69
07-14-2010, 03:05 PM
You know, you might end up with a de facto currency in any case:
1) If units of the same weight are the same value (as I noted above this isn't probably realistic), then people will carry whatever's less bulky. I'd rather carry 20lbs of iron (which is a small brick) than 20lbs of belly-button lint (which would, I imagine but do not know, fill several large sacks).
2) If units of the same value are different weights, then people will carry whatever is most valuable (and therefore lightest). My ounce of iron is worth a pound of rice so why would I carry several pounds of rice around for trading when a pound of iron would do?

Of course, if all you've got is rice (or if you're even more destitute and all you have is belly-button lint) then I guess you'd carry that - but I imagine folks would spend a lot of time trading for things that are durable (don't spoil) and light if they're planning on having "cash on hand".

Just my 2lbs of belly-button lint worth. (ewww)
M

tilt
07-14-2010, 03:57 PM
yep.. agree with mearrin ... a good example could be - 20 lbs of firewood would be a lot easier to make than 20 lbs of wooden boards. Same material but a lot more work to get the latter. Even though a lot of civilisations use barter they mostly use some sort of currency too. Even the vikings had silver as a currency, they carried a necklace from which the could break a piece of silver to pay for stuff (when they didn't just raid that is *lol*). It was also important for them for the more long range trading... they were quite the travelers :)

Seretur
07-14-2010, 05:35 PM
In Dal society an item's/object's worth is determined by it's practical value rather than a form of monetary (check spelling) value. So steel would have more value than gold as, even though the gold is rarer and desireable in most cultures, it has more practical uses e.g. if you're looking to outfit an army or a labour crew your not going to give them golden equipment with is heavy but soft when you can give them steel or iron equipment which is more readily available and more durable; gold is still are nice commidty amogst the high nobility who can afford it.

This is the only objection I have. You say that worth is determined by practical value, which would work, if your culture is very Spartan and doesn't care for beauty. However, if gold is a nice commodity, and is expensive, as the underlined portion indicates, then your culture does value things based on beauty as well as worth.


So in Dal society, when dealing with large amounts of material and goods the unit system is used and when dealing with smaller goods or services the commidity currency is used. Trade offices are also located in each settlement with substantial trade activity to regulate these dealings and to help people convert raw goods into commodity currency and vica-versa. Would such a system seem feasible?

Absolutely. As mearrin said, the Romans did it for hundreds of years, with salt.

Wannabehero
07-14-2010, 05:56 PM
A very interesting idea for a fantasy society, I can definitely see this as being fun to use in a RPG-type setting.

I do agree with the other posters here though, a 1 to 1 exchange for any and all goods just doesn't make sense in any logical scenario. Some goods have an inherently greater value based on primarily two factors:
1) Rarity (scarcity), materials that are useful but rare are inherently worth more.
2) Labor, materials and goods that require more effort to make or acquire are inherently worth more.

I'm sure others who are more schooled in economics could break that down into greater detail, but those two guidelines work pretty much all the time.

That is why, say, a tool made of wood and iron is worth more than the wood and iron it is made of, because it required labor. And that is why 20 lbs. of salt is worth more than 20 lbs. of loose rocks, salt is rarer (and requires more labor to obtain) than loose stones.

I would suggest that you can keep your non-currency society intact, but maybe mix it up a bit with some pseudo-currency standards, like the exchange rates mearrin69 suggested.

Think about your society. What are their most common goods? These could be used in place of the normal dollar/euro/gold type of value system.
"That little shack over on the hill? It'll cost ya ten hogs and seven chickens"

I'm reminded of the Bone comic book series (http://www.amazon.com/Bone-Comics/lm/ZM2YJ8AQ1LEP), where in the little town of Barrelhaven the standard form of currency was the egg.

Ascension
07-14-2010, 06:19 PM
I would also suggest, as some have hinted at, that labor required be taken into account. Mining iron is hard work, for sure, but making steel is a lot of work also, you have to combine iron and carbon (usually from hay or wood) and it takes hours and hours. Then to make a sword requires many many more hours. A sword has a certain weight of around 3-5 pounds. So 5 pounds of sword is worth the same as 5 pounds of clay (used for pottery). Not very likely because of all the labor involved. You might be able to say that 5 pounds of sword is worth the same as 5 pounds of shovel heads. So what I'm saying is items further down the production chain (finished goods or manufactured goods) would have to be worth more than items at the beginning of the production chain (raw materials) due to the labor factor. What happens if one blacksmith makes better swords than some other blacksmith whose swords always break? I doubt that they'd be worth the same. What if some baker makes delicious pastries while another baker just makes flatbread or one tailor makes fine clothes while another makes burlap smocks?

Since your land has castles that implies a nobility and those snobs like rare things like big fat gems and gobs of gold. Sure they may be high-minded enough to really care about their subjects but they're not going to level the playing field and live like the rice farmer when they've got a big castle. Gold and iron also weigh about the same but one is going to be prized by the upper crust more than the other. If I go to the market to buy a bagload of potatoes I'm not going to give up a couple of swords or bag of silk shirts. The farmer might say that his work is just as hard as the blacksmith's but I eat the potatoes and they come out the next day but the swords will stick around for a few years. I can also defend myself with a couple swords - I don't think that I could defend myself with a bag of potatoes unless I was Bruce Lee. So object permanence also figures in to the equation. If I'm the guy living in the castle I also want some salt and butter on my potatoes, and maybe some chives or dill, so I'd rather cough up iron dust instead of steel dust. The Dals in the Mallorean presented a utopian socialism to the world but they still had a heirarchy where the seers lived up in the mountain and told the others what to do.

You might be able to get away with this on a small scale like a village here or there but economics will always win out.

Crayons
07-14-2010, 06:21 PM
Think about your society. What are their most common goods? These could be used in place of the normal dollar/euro/gold type of value system.
"That little shack over on the hill? It'll cost ya ten hogs and seven chickens"

I think Wannabehero has the basis for the solution. Your basic commodity is rice and was used in Japan as the basis for measuring "wealth" on a macroscopic scale at least.
The "koku" was the amount of rice 1 person needed for one year. (Look it up on wikipedia if you haven't already?). 1 koku has a volume and a mass which can be used for measurement too.
From an economic standpoint one koku represents a number of aspects of value.
Land, to grow it on.
Time to grow it.
Labour (people) to farm it.
The total represents essentially represents a calorific value = energy.
Provided you live where it can be grown it represents a "reasonably stable" monetary standard. It's a mathematical exercise, with some land/time/people conversions, then, to convert a cost in raw iron (say). How much land, time and people does it take to make one "thing" of pig iron.
In terms of "foreign" exchange, you look at direct conversion of rice to (for example) corn, or wheat, perhaps converted via "calories".....
I'm kinda "thinking aloud" here!

You might also look at modern exchange systems. I saw something on TV once where more local/isolated communities adopt a local "scrip" for exchange of goods and services. Two hours plumbing is worth 3 hours weeding the garden?

LonewandererD
07-15-2010, 12:55 AM
Okay, I will need to work out the details more. The unit for unit system was developed by farmers where a unit of rice would be traded for a unit of grain, fruit, animal fodder, and so on; this worked because all goods where perishable and all had immediate practical use. The unit for unit system (abbreviated to UUS for writing purposes) was then adapted into the trading of other materials but as all meaterials can't be traded by a like-like basis the UUS is used create a base worth of the material and the local trading post (who communicates with other posts across the Dal Lands) works from there to determine an items worth taking into account usability, rarerity and local abundance. They can also prevent the trade of illegal items or items with very little worth (so firewood would only really have worth in your town market), extra cost for manpower and time are meshed out by the haggling merchants who try to get the most for their goods, a lot of shouting is involved but physical altercations are forbidden.

Smaller items are priced in a similiar way, the item is weighed and then the vender puts up the price in accordance with quality, time and so forth. Non-item services either charged a certain amount of commidity currency (or Bajid in form of Dal iron coins, or Chakit in the form of rice) for their services or are completely negotiable. Salary are paid in bajid/chakit or in a portion of the material they helped to create. A salary goes down if lodging and food has to be provided but that is worked out at its appropriate time. All in all it mainly comes down to haggling, haggling is considered to be the most common Dal pasttime, the UUS and trading posts just help to give it some structure and control.

Want to write more but I have to rush off to work.

-D-

tilt
07-15-2010, 01:45 PM
good thing you wrote about haggling, cause there is always somebody who's better to get a good deal than others. Or when you need the others product more than he needs yours, alsways a difficult possition to trade from :)

jwbjerk
07-16-2010, 12:03 AM
In it's simplest form "money" isn't anything mysterious, arbitrary or magical. It doesn't have to be metals, though there are good reasons precious metals were frequently used in history.

Let's say you have a barter society. It works, but it's not as convenient. Let's say a rice farmer wants to buy a field from a neighboring rice farmer. Is the second farmer going to be excited about getting more rice? Of course not, he already has all the rice he needs, what he wants is a horse. The third guy with extra horses already happens to have a year's supply of rice laid up-- any more is likely to go bad before he eats it-- what he wants is a some furniture. And so on. People either have to accept things they don't want (often with a limited shelf-life) in hopes they can trade them with someone else, or try to figure out complicated multi-person deals.

That's where some kind of medium of exchange comes in, i.e. money. These are the qualities that make something a good candidate for being "money":

* It's easy to transport -- high value per pound
* It's easy to subdivide
* Lots of people want it
* It doesn't require special care
* It doesn't quickly go bad
* It's uniform -- not hard to assess the value
* There's enough of it to go around

You see why societies would end up using metal as money (and it's not just "pretty" metals that have been used but all of them) -- it fits the above criterion better than almost anything. Salt works pretty well too if it happens to be scarce enough to be valuable. Cigarettes have been used. It's a lot more convenient to carry bits of metal to the market than livestock, bushels of grain, bolts of cloth etc. Metal has intrinsic value. It's hard to obtain, and can always be used to make something.

Unless the society is small and simple, or there are some strong destructive laws/traditions against it, they will end up using whatever available substances best fit those criterion. It doesn't have to be one thing. Coins of tin, nickel, copper, iron, bronze, silver, electrum, and gold have been used as money simultaneously.

Gidde
07-16-2010, 12:06 AM
Kim Stanley Robinson did something -- well, if not similar at least in the same general ballpark -- to what you're proposing in his Mars trilogy (Red Mars/Green Mars/Blue Mars). Faced with needing to design an economy from the ground up, they used two currencies; a rare item for an economy similar to what we have, and a useful item for a secondary "gift economy". Check em out if you've never read them and like sci-fi; there's some pretty in-depth philosophical discussions in there regarding society and economy that could be valuable to anyone worldbuilding.

LonewandererD
07-16-2010, 12:56 PM
So if I kept my society small, as in each clan being a seperate society from each other, than this system should work? Inter-clan trade does occur but it is for the most part controlled by the nobility and so they would work their own system for it. On the subject of economy, would this be an acceptable tax system.

When anyone creates or harvest any form of goods or raw materials they have to abide by two universal laws, the People's Rights and the Clan's Rights. The People's Rights dictates that should anyone assist in the work in an appreciable manner, such as helping to grow and harvest the crop, than they are entitled to a small portion of it. The People's Rights are ensured by a labour contract where the labourer works for the entire length of the contract and if they follow all the way through then their share is legally ensured.

The Clan Right's dictates that the individual's clan is entitled to a portion of their goods or wealth, normal around a third to a half of it, anything left over is theirs. The individual will keep some of their goods for personal use and most trade off the rest. This is collected the local Yama'N who enforce the taxes and laws in each village and small town, a portion is kept by them, a portion is kept by the settlement and a portion is collected by the local Banares Shi'N. The Banares Shi'N control the towns are a sort of like the mid-high ranked nobles; again a portion is kept by them, a portion is kept by their settlement and a portion is sent on the to reigning D'Shi'N. The D'Shi'N is the clan leader and portion of all the goods received from all across their clan's domain is given to their capital city, a portion is sent to the Jha'N, the leader of the Dal, and the rest is theirs. In all of these cases when any food goods are siezed (these goods gain highest priority) then a portion is put into storage, the Dal are very conscious about planning for the future. This system was first concieved to make sure that the yearly crops would get to as many people as possible.

If a person can'y pay their tax in goods, like warriors, than they pay either in bajid or chakit, where possible, or in other services like manual labour or military duty. People who directly serve a D'Shi'N or Banares Shi'N are normally exempt from tax. The Wandering People and the Spirit Walkers (sort of the local priesthood) are also exempt from tax.

Would this work?

-D-

jwbjerk
07-16-2010, 02:18 PM
How do these people divide off portions of things like horses or boats? Say a shipbuilder make one ship a year, or a carpenter makes a few houses a year. How can you divide up these items among the workers, clan, etc?

People have used equally oppressive and counter-productive economic systems, in that sense it could "work", but it wouldn't work well.

Juggernaut1981
07-17-2010, 01:22 AM
Um, dense point of history about "commodity fiat currency". The British Pound, is a note valued to be equivalent to one pound of sterling british silver held by the English Monarch.

Running on a commodity system entirely... (two quick examples)
1. Hebrew Law regarding the Levite Tribe (they were given 1/11th of everything since they were not to undertake any labour than working for God)
2. Roman Legion and Salt (by the way, having a pound of salt was actually probably more valuable and useful than a pocket of silver)

As these systems progress, eventually one commodity will become the standard for pricing all of the others. It is common and frequent. From my general encountering of ancient markets, there have been bushels of grain, fleeces, pounds of silver, wine, salt, spices (such as saffron) and any other not-easily grown or acquired commodity with high practical or rarity value.

Juggernaut1981
07-17-2010, 01:47 AM
Draft Design Trading/Money System:

Establishing a Baseline:
1 bushel of flour (weighing approximately 60kg and having the same size as a large duffelbag/backpack) is a very common commodity and will supply a small family for approximately 1 month. 60kg of flour will probably make as much as 50 large loaves of bread, will require about 100 eggs, 200g of salt, milk/water & lard or butter. Milk, water and fats (lard, butter) are assumed to be easily supplied assuming most peasants have access to at least 1 cow's worth of milk daily.

This would mean that 1 bushel of flour is roughly equal to 100 eggs or 200g of salt. Milk is basically valueless, but butter and cheese would have a greater value. The reasoning is that if I have a supply of eggs (breeding chickens), I'd need 1 bushel of flour to make my bread for 1 month. So it stands to reason that I would trade 100 eggs for 1 bushel of flour... that way I get flour for my bread and the flour-owner gets eggs for theirs.

I cannot save in commodities. Flour perishes,so do eggs. I need to have something I can store for many years. Hence most groups developed SOME kind of currency.

You could name is something like a "Salter" (if it came from salt), "Bushel" (if it is based on the value of a bushel of flour), etc

Etheremis
08-04-2010, 12:14 AM
Fascinating discussion with a lot of excellent points brought up already. The Romans paying their soldiers in salt was the first thing to cross my mind reading the initial post. I would like to point out a few things.

1. The solution lies, I think, with a hybrid system. You espouse that a farmer won't trade in his crop for paper bills. A noble, however, is much more likely to. These bills would more than likely be be deeds and titles. Even if they were money then it stands to reason that is would be redeemable for a large quantity of silver/gold coin. Peasants would probably have a few coins but mostly deal via bartering. Even if the currency was not gold/silver portability is a must.

2. Most people would be ignorant to the exchange rate between between one unit of chickens and a half unit of iron. Most people only want to buy exactly what they need. (I just re-read some of the responses and it was pointed out that weight of unit should vary based on item in question)

3. Supply and Demand. The exchange rates are likely to fluctuate wildly depending on circumstances and location. A farmer in province A has a lot more rice than farmer in province B (because of the drought there). Since the people in both areas need to eat farmer B's yield (what little he managed) is actually worth considerably more based upon weight than farmer A's.

4. Multiple weight systems. Take a look sometime at all the differing weight systems employed http://en.wikipedia.org/wiki/Avoirdupois http://en.wikipedia.org/wiki/Apothecaries%27_system. Some of them were only used for metals and some only for pharmacological. Unless there is one fixed standard of measure it becomes a nightmare.

5. Are there neighboring countries to Dal? The lack of a currency is a barrier to commerce. This barrier is not insurmountable but does make a legitimate concern.

One thing many people fail to consider with regards to currency is that money is an abstract for wealth. Wealth is based on goods and/or services. A gold coin's value is not necessarily because gold itself is valuable. I can have a mountain of gold coins, but no actual wealth. It is because with this gold coin I can obtain x product or y service. The coin itself has no value until it is traded. Also, until it is traded the value of the coin is not fixed. It may say $1 on it, but if someone will give me X for it and another would give me X+Y it's value is not set until I make a deal.

All said and done your system can work but there are a lot of rough edges to it. Bartering is the earliest form of trade. I have some concerns though with this system and the nature of your project. If you are just mapping as a creative exercise and were curious, then the responses I have read are all enough to give you a good idea. If you are planning this as an rpg setting and intend to play it, then i foresee some problems. At that point you should probably list everything by it's value in X and then come up with some exchange rates. That set up is almost analogous with coinage anyway and personally i wouldn't go through the hassle because your players will probably get very frustrated when trying to buy things. It will be novel the first time but eventually it will be annoying.


btw, Hi everyone! I just joined the guild the other day and this is post #1. (I hate "introduce yourself" boards...)

LonewandererD
08-04-2010, 06:59 AM
While I ponder my way through points 1-4 I can say for point 5 that no, they're are no "countries" neighbouring the Dal Lands, well at least not any countries that would be open to trade. The Dal Lands are situated in what is known as the "Forgotten World" a continent far removed from the rich bustling empires of the Everlandias. Dal humans are a racial minority, to date they have not come into significant contact with any other human country, with the excveption of the traitor nation, a clan that split off from the Dal and now live in exile, trade with them is strictly prohibited. To the north are the Belpra'Hadun Nations and they are racial sumpremesists who sooner see all humans destroyed than trade with them. To the west and throughout the Dal Lands are the Wya'Kai and Ithkien, the Wya'Kai also would like to see the Dal dead and the ones present in the Dal lands seem to be vanguards and rogue warbands from a greater nation further to the northwest, the Ithkien live as nomads and strictly barter and haggle, they have no use for currency out in the middle of nowhere. The east is open ocean, nothing out there, and to the south are the Sunrise Isles where the Kif reside and because of the distance between them and the Kif's apparent lack of the technology, despite rumours of a hidden Kif nation, they also only barter, the Kif have not developed a concept of currency.

-D-