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You Fail Economics Forever
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October. This is one of the peculiarly dangerous months to speculate in stocks. The others are July, January, September, April, November, May, March, June, December, August, and February.
Linkara: Thus making the money worthless due to Simple Economics... Wait...
The nice thing about Mathematics and other Hard Sciences is that there is no question * that 2 + 2 = 4.
The complicated thing about Sociology and other Social Sciences is that there's room for interpretation and debate.
The horrifying thing about Economics is that both of these are true.
This violent collision leaves a few absolutes to take refuge behind, and a wide open mine field for catastrophic assumptions and mistakes, and prime Flame Bait. There are a fair number of widely divergent economic schools of thought, each with a reasonable claim to accuracy, and each which believes the others to fail economics forever. This is probably one of the reasons Thomas Carlyle called economics "the dismal science". (And few agree on that term... Economists will claim their science isn't dismal, and many other fields will claim it's not a science. The dance goes on.)
Thus, anything to do with economics, right down to an innocent page on a wiki described as "a buttload more informal" than That Other Wiki, is a breeding ground for arguments. Think of this page as the sweating dynamite version of a Spam Attack In A Can, catastrophe only averted by the Rule Of Cautious Editing Judgment. Play nice.
Above all else, let's get one thing straight here: this trope is not about which real life economic system, theory, or idea is right or wrong (because no one can agree on those things anyway), but about which completely fictional economic system, theory, or idea is completely unworkable under the laws of economics. This does not mean they are not regularly tried by various Real Life groups, just that they aren't economically sound.
A few possibilities for these are Mary Suetopias, Dystopias, or Author Tracts which for the sake of the story ignore basic economic theory to make a point. To avoid Flame Bait, examples should exhibit one or more of the following economic fallacies:
- Money For Nothing: Someone or something gives out 'free wealth', be it by literally printing money or handing out gold ingots to everyone from a new huge mine. This should actually lead to everyone having Worthless Yellow Rocks, although this can be a good idea (under some schools of economics) in very limited circumstances.
- Destruction Equals Employment: Otherwise known as the "Broken Window Fallacy"
 . The government props up its economy by having a huge war industry. The fallacy lies in ignoring the fact that the resources destroyed in the war (i.e. all the money spent blowing stuff up) could have been used for building things instead (i.e. wars that aren't necessary for self-defense are always economically destructive overall (when all the costs and benefits to all parties are tallied up)).
- Note, however, that this only covers cases where the domestic war industry is supposed to be the primary motivation for the economy (rather than an embezzlement scheme by the military-industrial complex.) War itself, on the other hand, is a very profitable pursuit for those who loot and plunder.
- Heck, it's even sustainable if you use crop rotation…
- Also, according to Keynesian economic theory (one of the more popular schools), massive military spending can provide an economic boost in the situation that the economy is already a complete wreck. The standard example for this (an example which is contested by several economists of different schools of thought) is World War II ending the Great Depression. That said, Keynesians agree that military spending does act as a drag on a healthy economy.
- And again, Keynesians also would agree that the money would be better spent on things that are actually useful, since the possible boost to the economy is the same whether the money is spent on building bombs or roads. The latter is at least useful after everything is over.
- It also depends on the nature of the warfare. While a poorly executed, optional war of attrition will more than likely drain resources pointlessly, wars of national survival tend to bring about vast technological innovations. This actually provides long term growth. Even the threat of war can provide this (look at the tremendous leaps in tech during the cold war. And certain aspects of the industrial revolution in continental Europe were spurred by the power rivalries), or being in a stratgic fault point (South Korea, Israel, West Germany).
- Some cultures have had economies dependent on war. The Aztecs used wars to gather large slave workforces (and to keep the sun in the sky) and the Huns took massive riches from the Romans and other tribes through wars.
- Digging and Filling Ditches: The government (or a corporation) gives everyone a job and pays them, without regard for the actual usefulness of said jobs. When you boil it down, this is just another flavor of "Money For Nothing". It is also another flavor of the broken window fallacy or "Destruction Equals Employment". There are significant opportunity costs associated with the resources required to pay the people working on the newly-created jobs (because these resources could have been used to do something else, which may have been more beneficial).
- Exporting Good, Importing Bad: It's usually used something like this: Exporting something is good and makes others dependent; this is good. Importing things is bad and makes you dependent; this is bad. Note that there was an early economic theory, mercantilism, which taught this exactly. In truth, some countries have a relative productive advantage in some areas, while other countries have different relative productive advantages. Trade allows countries to specialize in whatever production they have an advantage in, thus producing more in total, and then trade with each other. This makes both countries better off. For example, perhaps Country A can produce 4 cans of butter, or 2 cans of butter and 1 carton of eggs, or 2 cartons of eggs. Country B can produce 4 cartons of eggs, or 2 cartons of eggs and 1 can of butter, or 2 cans of butter. With trade, they can produce at their advantages of 4 cans of butter in A and 4 cartons of eggs in B and then trade so they each have 2 cartons and 2 cans. Making them both better off than if they produced everything in their own country.
- It's worth noting that in an Empire that has expanded sufficiently the Mercantile system makes more sense (although probably still isn't optimal) from the perspective of enhancing state power. However, in terms of delivering an economically optimal outcome (i.e. maximizing utility), the Mercantile system still Fails Economics Forever.
- Ridiculous Future Inflation: The main problem with this is that it is often portrayed as being a natural and normal result without any of the many social and economic problems hyperinflation show in the real world. It is, however, normal to see drastically inflated prices as a result of a past inflation.
- Wealth is Zero Sum: The assumption that all business or economics is based on grabbing the largest share of the pie that you can. This is how you get ideas like "businesses want to keep people unskilled and uneducated because that means they can control a larger share of the wealth", which ignores the fact that an educated work force would be far more productive and make everyone, including those formerly in control, much better off. The fact of the matter is modern economies are usually successful because they recognize wealth isn't zero sum.
- Superiority Equals Success: The idea, that a product's measurable quality, for example a screen's resolution, a vehicle's speed, or a computer's processing capacity is the most important thing for consumers. In Real Life, even when they cost the same, often the "inferior" product is more appealing, simply for being easier to use, or even being sold in more attractive colors. Most consumers are laymen who are uninterested in the details of the product that they need to buy, as long as it does what they need.
- Ridiculous Rationality: The basic assumption underlying this one is that human beings are perfectly rational (everyone will buy exactly and only what they need, at the best possible price) and a perfect market is possible (laws against unfair dealings are both reasonable and enforced, prices reflect all external factors, and there are no significant real-world barriers to starting or operating a business.) Basically, even under ideal circumstances, even with good intentions, a well crafted economic system must mitigate the fact that Humans Are Bastards. Note that this works hand in hand with the previous fallacy: the real world is not a perfect meritocracy. Be wary of believing too much in fictional ones that are. In short, if a work assumes that human beings act via absolutely perfect utility calculations (as defined in Walrasian economics) in all situations, the work commits this error.
- Of course this is the main critique given of real life economic theories, as rationality is the primary assumption backing almost all economics. Most economists argue back that as long as you are dealing with large groups of people, rationality is a workable assumption. Oh and rationality usually assumes Humans Are Bastards — since rationality usually means being a bastard when you can get away with it is the best course of action.
- Possibly averted in certain wings of the Austrian School where Human Action is assumed to be somewhat unpredictable, which is why all but a handful of Austrian Economists stop short of anarcho-capitalism and tolerate a small government or "Night Watchman State" to protect people from
irrational criminal actors.
- The resource halt: A source of conflict in many post-apocalyptic scenarios is the sudden exhaustion of a valuable natural resource such as oil and the conflicts that inevitably flow from it. Any microeconomic principles student will tell you that the real world does not work this way. If mankind is faced with such a threat, owners of the resource will withhold some of their stockpiles now in order to take advantage of the future scarcity. Furthermore this will means that the price of the resource will rise slowly, giving humanity time to adapt. As a result, the point where we do run out will not be a trigger for a massive calamity, rather it will hardly be noticed.
- A sudden, temporary decrease in availability, however, can be entirely plausible. This can occur (and has occurred) due to the obstruction of transportation routes, the destruction of the production apparatus, or monopoly/oligopoly producers artificially withholding supply in order to serve other motives. The effects of these scenarios are likely to be tied to relatively specific times and places rather than being The End Of The World As We Know It (although it may feel that way to those affected).
- Rights-Efficiency Tradeoff: The false dichotomy that suggests that civil liberties and workers rights would automatically undermine economic efficiency. This idea, which is implicit in the idea that Hobbes Was Right, is not only an oversimplified model of political theory, it's also a severe bastardization of welfare economics. In fact, many economic models like the coase theorem suggest that markets become more efficient when certain rights are institutionalized. This trope was notably more popular before the fall of the Soviet Union effectively discredited it forever, but many writers still haven't gotten the message. Whenever this trope is invoked, expect to see a lot of rag clad vagrants mucking about in the wastes outside a clockwork efficient police state, consoling themselves "at least I have my freedom".
- America the bankrupt: National debts don't work like your personal debt. For example, people don't buy your debt to prop up your currency. Yet for some reason a lot of writers tend to think of the national debt in the same terms as a bank loan, with angry creditors and everything. When this trope is invoked expect to see a consortium of angry foreign dignitaries banging on a conference table that they want their money back. In reality if countries actually acted like this the global financial system would probably collapse pretty spectacularly and everyone would be screwed. In recognition of this fact, when it looks like some country or another is going to default on their debts the international community is typically quick to put together some sort of a bailout scheme or debt forgiveness. This trope is not specific to America, but for some reason Americans are exceptionally paranoid about the National Debt, particularly when The Chinese are buying it up. Oddly enough, America's National Debt isn't even that bad by international standards.
- Ideological Identity Idiocy: This is the intersection of You Fail Economics Forever and Strawman Political. Often, a work that wants to make a political point will (probably accidently, but possibly deliberately) make mistakes about the definitions of specific economic systems. In short, authors often don't know (or don't care) how economists actually define economic systems. Economic systems exist to allow a society to economize, i.e. allocate their supply of means towards various different ends. The supply of means is scarce because it cannot achieve all these ends. Thus, an economic system is something that provides a method by which these ends are prioritized and means are directed to fulfilling them.
- Post-Scarcity Economy: The supply of means is no longer scarce. This means that people don't need to economize. A society in this stage cannot be meaningfully described as any of the following labels since those labels only apply to societies with scarcity economies.
- Socialism: An economic system where there is a scarcity economy (i.e. ends/desires outstrip means/that-which-is-desired), and in order to remedy this scarcity economy, production is organized through and products are distributed by some sort of central authority. This central authority must have de-facto property rights (i.e. control over the utilization) over all of the means of production (i.e. inputs to the process of producing goods) within its jurisdiction. Whilst many self-proclaimed socialists argue amongst themselves over what kind of body should serve as a central authority, the vast majority of economists, including Socialist economist Robert Heilbroner, believe that such a system will inevitably require the State to serve as this central authority. Thus, the majority of economists define Socialism as State ownership of/control over the means of production, even if this is technically only one variant of Socialism.
- Capitalism or Free Market Economics: An economic system where the scarcity economy is remedied exclusively via a system of private property. All the inputs to the production process are owned by individuals or voluntarily-formed groups thereof whose property rights are derived from those of the underlying individuals that make up said group (for instance, businesses with more than one owner). All economic activities must take place between consenting parties. Hence, under Capitalism, all economic activity takes place within the realm of consent and contract and hence outside of the jurisdiction of the State. The State's role is restricted to the enforcement of property rights and ensuring that human interaction is free from force, fraud or interpersonal coercion (i.e. protecting the realm of individual consent and contract). A note: some advocates of Capitalism give a slightly larger but still strictly limited role to the State, and some advocates of Capitalism are anarchists that believe the State cannot be justified.
- Mixed Economy or Social Democracy or Social Market Economy: An economic system where the scarcity economy is remedied by a mixture of both of the above means. To qualify, both the State and the market must have a significant role in the economy (i.e. an advocate of Capitalism that gives a very small role to the State is not advocating a Mixed Economy, and a Socialist that advocates a small role for markets is not advocating a Mixed Economy either). The vast majority of the world's economies, including those of Western Europe and the United States, fit in this category.
A word of caution: some authors will actually make the above points work with the aid of Phlebotinum or even Aesoptinum. These examples are intentional, and probably don't apply. Run them by the discussion page first. Sometimes, for extra Anvilicious flavor, this trope is paired with Ludd Was Right, making a case for not changing anything technological or economic at all. Also, just because some of these things are stupid doesn't mean that they haven't been tried on many, many occasions.
Leave your pet theories at the door, put the natter in the Discussion page, and be prepared to read some stunningly stupid ways writers Did Not Do The Research. Please note, the Examples listed are for when the authors get it wrong. If the characters get it wrong and it is shown in-story to be wrong (for the right reasons), then place it in the Aversions.
This trope is not to be confused with Adam Smith Hates Your Guts. And for a common way of failing a shadier type of economics, see More Criminals Than Targets. When this occurs on a more personal level, see Hollywood Economics.
As a last note, economies are far more complicated than even most economists realize. Even a good author could be forgiven for not understanding them.
Examples:
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Anime and Manga
- Galaxy Express 999 episode 74 has a planet where everyone is a beggar. How do they live? Oh, they give and take from each other. (What?)
Comic Books
- "Damn the Expenses" is basically the flaw in most Cut Lex Luthor A Check scenarios, as the cost of the gadgetry to commit crimes typically outweighs the potential monetary benefit of using it for larceny.
- One old Disney comic had Scrooge surprised and mildly upset that he was making so much money (???) without being able to spend it on anything, and enlisted Donald and the triplets to go on an extensive, expensive spending spree across the country. When he returned he'd amassed even more money, since just about everything they splurged on was owned by him. No wonder he's the richest duck in the world - when the company owner makes more money from selling a car than the buyer actually spends there must be some very strange economic system at work.
- Hate to point this out, but... If he was making money already, yes? And Donald and the Nephews spent money that eventually found it's way back to him, yes? Then the money he was getting from other bussinesses (other people than Donald and the Nephews spending money) + the money he got back = more money, yes? How exactly were you trying to show fails economy forever?
- Because the spending of Donald and the Nephews is neutralised. It's like withdrawing money, then depositing it again. There's no profit and no loss. They may as well not have spent anything; the outcome is the same.
- He's saying that if Donald and the Nephews spent a lot of money that all made it back to him, Scrooge would logically end up richer because even though their spending was effectively nulled, he was still making money from other sources (presumably, purchases by other people). The reasoning as printed isn't correct, but the idea that he would end up richer isn't completely bogus.
- And don't forget that the money that was spent at his business doesn't just sit there and rot. It takes gold to breed gold, and Scrooge to me isn't the kind of duck who'd let money sit around when it can make MORE money.
- For example...a large ammount of money spent at certain companies could attract new investors, stock traders and such. And the employees of those companies would possibly spend their wages on products and services that Scrooge has a hand in...via direct control or simple stock holding...which would just perpetuate the cycle. Also, prosperous buisnesses often attract more customers.
Film
- The Russian fantasy film Sadko (known to MST 3 K fans as The Magic Voyage of Sinbad,) has the main hero try to help out his home town by forcing its merchants to redistribute their wealth among the poor. It doesn't work so well since there doesn't seem to be enough to go around. (That, and the hero ends up giving away all the money he was going to use for his quest.)
- In Canadian Bacon, the president wanted to start some international problems (eventually with Canada) so he'd have an excuse to reopen the recently closed munitions factories given the fall of the Soviet Union and the end of the Cold War. Then again, his primary goal was really just to stir up Patriotic Fervor and boost his popularity.
- A rapid inflation example is used in Support Your Local Sheriff, where the main character is eating at what can be described as a proto-cafeteria in a gold mining town, and looks up to see the prices being painted over from $3 to $8, to which one of his seatmates declares, "Inflation... sometimes it catches you between mouthfuls."
- The Watchmen film contains a scene where a pack of evil businessmen accuse Ozymandias of being a socialist, on the grounds that Ozymandias is attempting to create a device that will supply infinite free energy. These said businessmen argue that "free is just another word for socialist." Needless to say, this fails political economy forever (thus falling under reason 11; Ideological Identity Idiocy). Socialist economics (i.e. a scarcity economy wherein the government owns all capital and inputs) is a very different thing to post-scarcity economics (where there is no scarcity economy in the first place). This is arguably an instance where Alan Moore's own political biases were made blindly obvious.
- One of the corrupt businessmen was Lee Iacocca (the man who saved Chrysler in the 80's), so it may have been a direct Take That.
- Alan Moore had nothing to do with it, since that scene isn't in the comics (in which the dominance of electric cards was already well-established before the story began). The scene is probably a parody of present-day Republicans and the You Fail Economics (And Several Other Social Sciences) Forever moments they have every single time they utter the word "socialism".
- Lee Iacocca also makes no sense as someone who would oppose free energy. If unlimited electric power became freely available tomorrow, Chrysler could easily switch to making electric cars. In fact, he might even sell more cars, since consumers wouldn't have to worry about piddling trifles like fuel costs. The savings on his assembly plants' power bills would also be nothing to sneeze at.
- Except for the fact that the movie makes clear that most of the various patents etc. would be in the hands of Veidt Industries, who is the only company ready and raring to go on the electric car front. Switching to an entirely new motor technology is not as easy as you'd think, (and, at the very least, would mean months of refitting factories etc.) Veidt is about to make their industry obsolete. The whole scenario rests on the idea that Veidt is both the world's greatest scientist and the world's greatest businessman (as the two are often far from synonymous in the real world), but hey... the guy can already catch a bullet.
- The Mexican satirical film Un Mundo Maravilloso portrays an alternate Mexico which, thanks to liberal economic policies of recent goverments, has experienced economic growth comparable to Southeastern Asian countries. However, the film being a leftist Take That to those policies shows a country with poverty rampant, widespread unemployment (it even depicts a very well-educated man applying for a janitor post) and plunging stock markets (note that it is repeatedly stressed in the film by the authorities and organisms like the World Bank and the IMF that the country is enjoying a long period of economic stability and growth). Talk about Critical Research Failure...
- In The Fifth Element, Zorg espouses the "Destruction Equals Employment" mentality, and demonstrates it by destroying a glass and explaining how the machines that clean the glass shards away employ so many people. However, Zorg doesn't mention that only companies like his, which profits off of war, stand to benefit, rather than society as a whole.
- Which is why he, as Cornelius pointed out, had no "robot to pat him on the back when he chokes on the little cherry" or no one to depend on when he inevitably screwed up.
- The Commerce Guilds in the Star Wars prequels joined up to form the Confederacy of Independent Systems in the name of profit-mongering. But, considering how much wars cost, and considering how much a galactic scale war would therefore cost, just how much were they losing to Republic tariffs that would have made this economically viable? The two main justifications were that without a standing Republic army, they expected the Republic to cave in to their demands immediately, and that they were being manipulated by the Sith. Sith manipulations are apparently really good because once the former reason turned out to be a bust, there never seemed to be any indication that the Confederacy's founding members wanted out due to the cost.
- In the movie Dave, an impersonator replaced the U.S. President (the real president had a stroke during an affair and was subsequently hospitalized which was covered up). To show what a swell guy the impersonator was, he created legislation giving everybody in America a job.
- ...while at the same time introducing massive government financial bureaucratic reforms to free up the money for the public works that would be the center of the program. It's at least a low passing grade.
- The movie actually gave some examples of what was being cut from the budget to make the funds available, including hundreds of millions of dollars saved by cancelling a program that was intended to make Americans feel good about the cars they had already bought.
- The movie fails American politics forever, certainly, since half the things Dave does would require him having the line-item veto, which the president did not have at the time and does not have now.
- In Wisdom, a film starring Emilio Estavez and Demi Moore, the titular character, John Wisdom, goes on a bank-robbing spree, but not to steal money. Instead, he and his girlfriend destroy bank property records to help farmers. The film was released in 1986, a time when American farmers were having problems keeping their farms. The banks were seen to be the bad guys because they were the ones foreclosing when the farmers couldn't make the payments on the loans. In the film, John Wisdom is seen as a modern-day Robin Hood because he saves the farmers from foreclosure. Apparently, in the movie, the banks that are hit only have one copy of the records and when Wisdom destroys these records, there are no ill effects on the local economies.
- The film Wall Street Fails Economics Forever on several levels; primarily because its Villain Protagonist Gordon Gecko manages to become obscenely rich yet his primary knowledge of economics comes from a scene where a childhood Gordon is sitting at the table and watching his mother divide up a pie into several slices, and being told that he had to get ahold of as much of the pie as he could. Needless to say, this understanding of how an economy works fits under the wealth is zero-sum fallacy; ever since the eighteenth century it has been understood that wealth is not a static-size pie. But this kind of economic ignorance is not surprising considering the film Wall Street is an anti-market Author Tract.
Live Action TV
- Sliders has an episode featuring a world where all economic troubles are solved by allowing anyone who wishes to withdraw as much money as they want from ATMs in exchange for increasing the odds of winning a lottery. The catch? Winning the lottery forces you to commit suicide!
- Brilliantly spoofed on Monty Pythons Flying Circus. Dennis Moore is a parody agglomeration of all the old folk heroes who 'robbed to the rich and gave to poor'. He did so well he bankrupted the aristocrats but kept trying to rob them. As he said: 'Hang on a minute, this redistribution of the wealth is more complicated than I imagined'. The sketch ends with him attempting a one-man vigilante ... progressive income tax.
- The Tribe tries to institute an economy by having each vendor receive a loan of ten tokens at the start of the day to kickstart the system, and is expected to pay them back at the end of each day, and gets to keep the profit. To keep the system fair, the Mallrats also fix the price in tokens of each commodity. The system may be justified as the Mallrats are a bunch of kids with only the vaguest understanding of how economies work, but the fundamental premise seems to be that if you start out with a fixed amount of money, and just move it back and forth all day, at some point, it will magically reproduce.
- Star Trek and its descendants promised Gene Roddenberry's fantasy utopian future, which stated that money no longer existed. Initially, the Ferengi were shown to be incredibly primitive and violent because of their love for gold. Unfortunately, that raised a whole slew of unanswerable questions. After Roddenberry passed away the galactic monetary standard of gold pressed latinum was introduced (which incidentally retcons the Ferengi love of gold, to the point that they actually consider gold worthless except as a container for latinum). Credits existed in The Original Series, though seemingly only on the fringes of the Federation.
- The main flaw with the system introduced with replicators (no not those) is that although they do indeed remove the bulk of material scarcity, they don't remove labor or knowledge scarcity. Things still need to be fixed and knowledge still needs to be gathered to punch into the data bases. The easiest way to keep an economy going would probably be something where you only have to pay for human involvement. Or so I read in a book that discussed it.
- Material scarcity still exists in the Federation. There are at least a dozen episodes that focus on acquiring rare or difficult-to-acquire materials ranging from spare parts for the ships to a specific type of unobtainable rainwater to complex organic compounds. And even in the case of materials they can readily replicate, they still have to acquire the raw materials to feed into the replicators.
- In that last case, though, basically any form of matter can be used as raw material to feed the replicators. So that's rarely a problem.
- The classic example of a scarce resource in the Trek universe is Dilithium Crystals. These explicitly cannot be made by a replicator; according to one semi-canonical Trek novel, their crystalline structure extends into the 4th dimension.
- Gold pressed latinum is actually the official Ferengi currency. So the end result of the Federation abolishing money is that they simply adopted another nation's currency. And somehow, Starfleet officers always seem to have plenty of latinum when they need it. Does the Federation actually pay its people in foreign currency, or do Starfleet officers merely accept lots of bribes?
- In DS 9 O'Brien and Bashir barely managed to scrape together 6 strips of latinum for a game.
- Federation has a money system all right, the currency is a "credit unit". However this currency is poorly accepted by others, mostly because UFP is a cashless society, so all credits are monitored and more shady transaction (like the ones for weapons) have to run in other currencies. Also UFP's economics is very restricted (big corporations are somehow outlawed) which further decreases CU acceptance.
- Invoked in Renegade, when Reno infiltrates a town of only a few people he suspects of being robbers, and asks them how they make money. The leader basically says he buys stuff, and the other people buy it from him. The skeptical look on Reno's face is hilarious.
Literature
- The Honorverse by the People's Republic of Haven, with an unsustainable economic policy of a Welfare State gone amok and rife with corruption. Two centuries of fiscal deficit? Someone has to pay the bill sometime.
- The PRH's failing economy is a big part of the backstory. To keep the welfare state running, they start invading their neighbors and extracting tribute from them. Which kicks off the wars that make up the action of the novels.
- Michael Crichton's novel Rising Sun is accused of using the 'Exporting Good, Importing Bad' fallacy quite egregiously.
- The villains in Ayn Rand's Atlas Shrugged run an odd combination of 'Digging and Filling Ditches' and 'Exporting Good Importing Bad' (with a bit of 'Destruction Equals Employment' in the form of a Death Ray project). Eventually it culminates in Directive 10-289, which proponents claim will solve the crisis by requiring people to buy and sell exactly as they did the year before. This is meant to be a nonworkable system, though; the book is, of course, an Author Tract about the evils of controlled economies.
- The Co Dominium has Earth's Citizen class of Welfare State recipients totally supported by a small "Taxpayer" ruling class. The Citizens even live in rent-free "Welfare Island"
ghettos reservations housing projects and are provided with free recreational drugs. All while an American/Soviet government prevents all invention or technological research without either one cheating on the deal.
- The Girl Who Owned A City runs into number six pretty hard as explained here: http://adamcadre.ac/calendar/12186.html To quote: "Imagine Stephen Ratliff read The Fountainhead before penning one of his Marrissa stories."
- In a short story in the "Probability Zero" section of the Analog science fiction magazine, a primitive alien society discouraged greed by minting coins of refined uranium. Each (presumably very radiation tolerant) alien stored his stash of coins in the basement, and if it accumulated too many, it was...removed from the gene pool.
- The nobles in pretty much any medieval or feudal-flavored Crapsack World, for instance A Song Of Ice And Fire, shouldn't be able to fund their armies, with the callous way they let their peasants die in the thousands. For instance, no noble (at least none that had lived long enough to inherit a title) would refuse to let his peasants into his castle when attacked, let alone mock another noble who does. Keeping peasants alive was part of why castles were made that big (otherwise it's just more area the soldiers need to defend)—because without peasants, lords couldn't produce their own food, and lost their major source of revenue. Lacking food to supply their armies and revenue to pay them, they'd rapidly cease to be lords.
- In Eldest, Nasuada concocts the brilliant scheme of making inexpensive lace through magic and then selling it throughout the land, thereby funding the resistance. Everyone will buy this lace, she says, because it will be both the finest and the cheapest lace ever. Slight problem: she assumes that lace is prized because it is time-consuming, and that lace is a mark of class. Once it becomes easy to acquire, it will cease to become valuable (which is what happened IRL when machine lace became popular), and therefore her lace monopoly will crumble. "Everyone" buying her stuff will result in her ruin.
- Actually, she was at the same time trying to ruin the Empire's economy with the selling of cheap lace. She makes the assumption that the selling of hand-made lace was a huge part of the enemy economy, and whether that is true or not (we don't really know, as the effects of the experiment are never elaborated upon. The impression was that she never intended for lace-selling to be a long term solution anyway, because at the time, they were desperate for any kind of income they could get.
- It stil makes no sense, unless you assume the entire enemy society has started a Dutch/Tulip-like collection obsession. As far as it goes, she would simply have made their entire society a tiny bit wealthier and stronger, with more resources readily available for anything and ervything else. The most visible result would be the sudden impoverishment of formerly well-made lacemakers.
- In The Sword Of Truth the Sisters of Light give a bag of gold to anyone in the local village who bears the child of a wizard. After hundreds of years of this, gold still appears to be rare and valuable to them.
- How common/long-lived/fecund are wizards?
- There's a building full of horny wizards, made effectively immortal by magic. So fairly/incredibly/not bad.
- The Empire also has an economic system vaguely similar to Communism so ludicrous that it should have collapsed on its own years ago. While this might have been the point, it doesn't explain the Empire's ability to conquer a continent with a giant army that by, the economy described, they shouldn't have the money to create, the supplies to feed, or the command structure to control.
- I don't recall whether they specifically made the gold out of magic, though. While they had a fairly regular supply of wizards, if they are also just getting taxes, donations, or other fees from people there's no economic problem.
- Iain M. Banks's The Culture series depicts a post-scarcity economy. However, the author apparently commits Ideological Identity Idiocy when he identified The Culture as being (politically) "Socialism within, Anarchy without." First, since the Culture is Post-Scarcity, it cannot be said to be Socialist per se. Second, because The Culture can be entered into and left voluntarily, then The Culture is not exerting the power of the State in the first place. The essential characteristic of Socialism is not economic planning (even under Capitalism there is planning, but it is done by private individuals), but rather the fact that said plan is drafted and enforced by the State. Since participation in The Culture is voluntary, it cannot meaningfully be called a State.
Real Life
- Publishers and fans of comic books and collectible cards seem to be stuck in an all-encompassing logical fallacy about what dictates the collector's value of these items; essentially, they believe that artificial means of invoking rarity and demand in the product, such as slapping "Collector's Edition" on the label or dolling it up with unnecessary holofoil or other gimmicks, will raise its value over time. Anyone who had foolishly tried collecting these cards or comics thinking they'd be able to pay for college with them will quickly tell you how crap that is; simple supply, availability, and naturally-occurring popularity are what truly dictates the collector's value for these things. For instance, Linkara once noted that, due to its low printing, insane difficulty of finding an intact copy of good condition, and the fact that it was the first appearance of Superman, a copy of Action Comics #1 would go for much more than a "Collector's Edition" of Bloodgun #1, which is newer, has less popular characters or significance to them, and would have much more printings.
- The astronomical "damages" infringing copies supposedly cause to publishers used in at least every other "Why Digital Piracy Is Evil" argument. Usually it boils down to the price of original multiplied by [estimated] number of infringing copies... that are usually cheaper. In other words, based on the assumption that the same number of people would purchase the same product for $100 that did purchase it for $1. Not that every seven years old child can point out the state of the Emperor's clothes, but...
Tabletop Games
- In-universe example: the Orks in Warhammer 40000 have adopted their own teeth as currency. This works, apparently, because this way nobody is broke for long, and it's easy to redistribute wealth with a good left hook. Since Ork teeth decay at a remarkably specific rate, and most potential investments won't last long, there is no surplus and market values remain constant.
- Then again, Orks are not altogether that bright, so it is unlikely that anyone who would exploit the inherent flaws of the system will come along.
- Occasionally somebody clever will discover a way to kep teeth from decaying, which doesn't create as much chaos in Ork society as one might expect, since Ork society is a chaotic mess already.
- An alternate interpretation is that teeth, being primarily gained through acts of violence towards other Orks, act as an abstraction of physical power, which is what ultimately makes Orkish society spin. The Boss inveitably has the most teeth, becuase he is inevitaly the biggest Ork. However, his position must be sustained through the constant infliction of violence upon his underlings or foes, and so the high rate of decay ensures that no Ork boss may rely on wealth, thereby ensuring the continuing Survival Of The Fittest.
- Rolemaster's coinage hierarchy used to place tin coins below copper. If you assume an earth type world tin is rare and expensive - it's the fraction that makes bronze so much more expensive that iron/steel.
- As mentioned in "literature" above, the steel based currency in D&D Dragonlance doesn't make sense.
- It could, though (which is why that entry's not there anymore)—not only is good steel actually sufficiently scarce for use as currency, it's more in demand in their Crapsack World than gold. Weis and Hickman were probably going for a medieval version of a post-apocalyptic world where ammunition is a form of currency.
- That's how it works in Dark Sun, which takes place in a post-apocalyptic world. Steel is very rare and difficult to make, thus making it very valuable, and only very powerful people have steel weapons and armour. In Dragonlance, however, you just end up with situations where a steel sword, if melted and forged into coins, would be worth more than it's original cost (ie. say the sword cost 10 coins. By melting it down you could get enough steel to forge 15 coins).
- Speaking of Dungeons And Dragons, the 3.5 Dungeonmaster's Guide actually mentions that adventurers are in a minority that regularly uses coins- given the rough basis of the setting in medieval Europe, most peasants prefer barter, and wealthy nobles and royalty tend to trade in deeds and agreements. (basically barter on a larger scale) Coins tend to be used by the middle class (which may be small, depending on the setting), merchants and tradesmen. (I'm not sure if this falls as an example, subversion or what, but it's interesting)
Video Games
- Role Playing Games in general tend to fall under this, as Random Encounters provide an extremely high, if not unlimited, supply of gold. Inflation should have wiped out any and all economies years ago. Especially in any town in Dragon Quest surrounded by Gold Golems, which are Exactly What It Says On The Tin and are basically a walking retirement fund. One has to appeal to Gameplay And Story Segregation to make it coherent.
- Don't forget that Karl Marx Hates Your Guts. Not only is monster killing the easiest way to make money, it is often the ONLY way to make money - no part of the entire economy can exist without regular infusions of cash from busting open a Money Spider. This probably explains why every shop in the game seems to be a Trauma Inn, or a weapon, magic, or item shop.
- In Ultima VII part II: Serpent Isle, you can learn a spell that summons money from nowhere. The question of inflation is obviously not addressed.
- Prior to acquiring the said spell, the player runs into a group of corrupt pikemen who have 'arrested' the captain of the player's ship and want a
bribe fine of a gold bar to release him (and let you get on with the game). And it has to bee a gold bar. You can offer them thousands of Monetari (the local currency), but they will always demand a gold bar. Many walkthroughs have mocked this, but given the existence of the aforementioned spell, the pikemen may be more canny then one would think.
- But aren't those worlds famous for rampant inflation? Suddenly, it all makes sense.
- This is particularly a major problem in MMOs, where, like their single-player counterparts, money is generated indefinitely by the players when they kill monsters or complete quests. Of course, since an MMO, unlike a single-player game, actually has a persistent economy, this usually results in runaway inflation which developers usually attempt to curtail, to varying degrees of success, with "money sinks" — constant fees for things like travel, equipment maintenance, or all-but-essential sundries, and one-time expenditures of huge amounts of wealth for things that look cool but have little gameplay value.
- Not always — some games manage to keep their monetary policies nicely balanced. Eve Online, for example, has a staff economist, and the data show that the game is experiencing slow long-term deflation.
- The main money sinks here being taxes and buying anything from NPC corporations.
- A Tale In The Desert has no NP Cs (or combat) and thus a totally player-driven economy which is pretty stable, even the currency is run by players (until it starts people barter). A very successful trading guild The Goods priced items entirely on how much they had in stock at the time, it worked beautifully with stocks quickly filling up then hovering at a reasonable market value.
- A Tale In The Desert employs massive sinkholes in the form of livestock illness and other disasters, the cost of upgrades and the potential to lose out on your investments if your fail the minigames. The trading guide is only reliable if you are located near the Nile (the most desirable location for metagaming), otherwise the relative difficulty in acquiring papyrus throws the whole guide right out.
- Puzzle Pirates has a notably stable economy. Its "cash fountains" (where money enters the game economy) are the NPC pirates and monsters you can raid for booty, while its major "cash sinks" (where money exits the economy) are the raw materials required to make the economy run - you have to bid on materials in an auction house, and only a set amount of materials is introduced into the game at any given time, naturally driving prices upwards with demand. Making money requires cannonballs and rum, which requires iron and wood and other such raw materials, the wealth enters and exits the economy regularly, although another notable "cash sink" occurs when you actually start sinking each other's ships, including the tens of thousands of pieces-of-eight worth of materials it took to build them.
- As an interesting aside, in World Of Warcraft you can mine gold, but since you can do it at a relatively low level, a gold bar is normally worth a small fraction of a single gold coin.
- Less than a coin from a vendor; depending on server it can be worth considerably more on the player market. Mining can be one of the most profitable activities at early levels, even copper is worth a gold per bar on some servers.
- World Of Warcraft also has most low-level crafted items costing far less than the materials to make them, as there is very little market for them (most people who are levelling will eighter just use the stuff they get from quests, or buy some very good gear to powerlevel), yet people still need to make thme in order to level up their crafting skill.
- O Game's economy would be totally unworkable but for the need to constantly expand defenses and improve technology. Essentially it's the extreme form of Destruction Equals Employment that happens to work because a planet can produce an infinite amount of trade goods and weapons effectively erase objects from existence.
- On the other hand, Ikariam manages to avoid much Destruction Equals Employment by having islands with only one kind of luxury good (thus players can't build an effective 'one town war machine'; they could exist but the player would need to raid ''a lot'') and utilizes a building called the "Trading Post" to encourage peaceful trading between players.
- O Game's economy also assumes some very odd behavior. See you're pitted in a war against everyone in the universe but have apparently signed a treaty that you'll never have more than nine planets under your control. Players don't have a choice about this but it stretches Willing Suspension Of Disbelief when you consider a war based economy where everyone is playing by the rules.
- The ogame economy tends towards stagnation in the long term because successful players accumulate crushing advantages in fleet size and mine production. New entrants can't really compete for dominance in an established universe because the established players are already several years ahead of them on the exponential progression of "build mines, collect resources, build more mines, collect more resources...." Besides losing large fleets through carelessness or apathy, there's really no way to knock out high ranked players. Colonies (or the mines that produce the wealth) can't be destroyed and require no upkeep. So long as the players continue to spend what the mines produce, there's no way for them to fall behind.
- The Red Moon Online developers failed economics harder than I could believe. One item, called a "poison pill", was necessary to use regularly to make the game playable. The game had no upper limit on how many of a single item you could carry. So, many people stocked up on this item until a few people had millions of poison pills. Since there was a maximum number of poison pills in the game, no more were dropping and the price skyrocketed. They were going for millions of gold, far more money than most players had seen. The devs' solution? Give 1 million gold to every account one day. As you can imagine, the poison pills were soon going for hundreds of millions.
- Fable 2 fails economics pretty hard. Perhaps it's somewhat of an acceptable break from reality, but it wouldn't have been that difficult to come up with something slightly less stupid from an economic standpoint. The player can buy shops and houses, and can set the price level on them. However, the laws of supply and demand apparently don't exist, as raising prices by 50% will increase your profit by 50%. No one ever pays attention if a shop a few hundred yards away is selling the same thing at half the price you are. The only real disincentive for raising prices is a hit on the Karma Meter. Slightly averted in that if you own enough shops in one area, you can affect how good the economy as a whole is doing. Also, it's realistically possible for the player to actually own every property in the country. However, even if you have a monopoly IRL, you make the most profit by setting prices slightly higher than they would normally be. If you raise them through the roof, you'll make less.
- Counter Strike had this problem when it decided to go to a market-based system to determine the price of weapons. Their problem was that their algorithm to determine what the prices of each weapon would be was bizarre:
Valve: The new price for each weapon is based on the total amount of money spent on that weapon. The percentage of money spent on each weapon during the week is used to determine the percentage by which its price moves the next week. So if 10% of all dollars world-wide are spent on the Maverick M 4 A 1 Carbine, then its price will increase by 10%.
- By that logic, the cost of every weapon would rise or remain unchanged. What ended up happening was since some weapons cost as much as ten times as much as others (including most of the preferred weapons), pretty much every 'worthwhile' weapon immediately skyrocketed to absurd levels and every other weapon's value plummeted. One weapon actually reached a negative price.
- Tweak that a little and the percentage system might actually be viable. Using previous data, set a base percentage for each weapon and an appropriate cost - if, over the next week, one weapon sees the percentage spent on it rise above the base, raise the cost. If the percentage falls below the benchmark, drop it. It'd obviously need playtesting to get appropriate values, but they had the bones of a good idea.
- The same thing happened in Scorched Earth: The Mother of All Games if Free Market was turned on.
- The X series of space combat and trading is a hefty example. The specific problems with trading are numerous, from earning enough money to build a reasonable-sized fleet in under a week of game time (and why can't the NPC players do the same?), to having ships that are nothing but vendortrash should they bail. Finally, to make things fun, because the designers decided a player in an M4 (Light Interceptor) class ship can take out an AI run M6 (Corvette) (and in some cases an M7 (Frigate) — here's looking at you Scimitar), the cost vs benefit of just about any battle is heavily skewed in the player's favor. This is only somewhat averted by the fact that the AI factions don't have to pay for their craft. Or the weapons. Or anything else, for that matter.
- The entire point of Wario Land Shake It is about the Bottomless Coin Sack, which literally gives out infinite money to whoever owns it. However, the story obviously never considers just how utterly destroyed the economy would be for whatever country/world the owner actually used said treasure in. 10 million percent inflation?
- Maybe he planned to have them pay him to not use it?
- A Mind Forever Voyaging, while having a complex and very interesting premise, ends up being a game-length Take Tath to Reaganite policies. Double failure, in that none of the economical policies promoted by the in-game strawman party have anything to do with Reagan and/or conservative economics, and that those policies turn the world in a Straw Dystopia for no other reason than "because".
- Gaia Online. Originally, the Gaian economy was a fairly stable one, with users setting gold prices according to their popularity and rarity in the Marketplace; older items became more rare as more Gaia users joined after the limited-edition items had already become unavailable for ordinary purchase. Then they introduced Gaia Cash, which gives users the option to use real money to buy things that can't be purchased with regular gold; the Cash Shop is updated more regularly than the gold shops and offers higher-quality items, usually with multiple poses, and are often based on popular other media (such as Eternal Sonata or Naruto). Then they added zOMG, which proves an endless source of gold for users. The end result is a hugely inflated Gold economy, as Cash Shop items fetch extremely high prices on the Marketplace, while their quality vastly depreciates the value of older items that were made with older technology and artistic talent, and some items that can only be obtained through the Cash Shop being given an arbitrary "store price" to prevent their value from declining in the Marketplace. Now, Gaia is struggling to find ways to lower the amount of gold in the economy— their most recent attempts are a special, temporary shop that produces Cash-Shop-quality items, but charges multiple millions of Gold for them, and Random Item Generators, minigame-based items that usually cost between 30 and 80 thousand gold to play, but have a high chance of producing a low-value item worth less than half of what it costs to play. And the presence of these items in the Marketplace depends entirely on someone paying real money to get the item and then selling it in the first place.
- The creator of Dwarf Fortress admits that as of now, the economy system basically doesn't work. Minting coins is discouraged, and sometimes even allowing the economy to kick in is discouraged too.
- MAG Fails Economics Forever because according to The Other Wiki, the backstory confuses a lack of economic regulations with a lack of laws against murdering and destroying the private property of your competitors. Needless to say, not a single advocate of economic liberalization argues for repealling laws against murder or sabotaging competitor's private property. This is an unfortunate case of Failing Economics Forever too, because the plot clearly has some level of comprehension of the concepts of supply, demand and market pricing.
Web Comics
- An in-universe example, Played For Laughs, but not quite the above: a pair of potion sellers in Order Of The Stick don't seem to get that by selling nothing but potions at less than the cost to make them, they are going to put themselves out of business. V tries to explain the problem to them, but after realizing that nothing is getting through, the annoyed elf decides to take advantage of the sale they just announced.
- Kit N Kay Boodle features the town of Yiffburg, whose economy is sustained entirely by its single export, a combination aphrodisiac/contraceptive fruit that everyone in town eats on a daily basis and grows in their homes, to the point where the average citizen doesn't need to work to pay for things; instead, they use an ambiguous thumbprint-reading credit system. The fail continues when a lawyer points out that Yiffburg is a textbook example of an arrested economy with no money going into it— except that Yiffburg is essentially the world's only supplier of birth control Viagra berries, which are in extremely high demand to the point of being illegally imported. And of course, every business in the city allows its employees to freely have sex while on the clock, even in food service, so it's a wonder anything gets done at all.
Western Animation
- Parodied in South Park when Canada goes on strike and demands more money, specifically from the internet, and completely ignores the people who try to explain that that's not the way economics work.
- Also when Earth gets its hands on a huge amount of "space cash" and proceed to use it to build hospitals and amusement parks and so on. At the end, an annoyed alien tells the idiots that it has no monetary value beyond what they ascribe it.
- Rocky and Bullwinkle. The Fractured Fairy Tale take on King Midas had him making huge amounts of gold, which made everyone happy. That is, until they realized that it now took a wheelbarrow full of gold to buy one turnip. They almost get it right, until the villagers switch to using turnips without the king's knowledge or consent.
- One episode of House Of Mouse involves Professor von Drake inventing a special credit card that could "end poverty" by giving everyone in the world an effectively unlimited cash supply. It seems to exist solely so that the villain could steal the only one and... well, use it to do exactly what it was created for. None of the characters question the logic (though, fair enough, Mickey does cut the thing in half at the end of the episode.)
- Conversely, however, another episode had von Drake invent a machine that could multiply any money you put into it... and had him promptly and appropriately arrested for counterfeiting.
- The "America The Bankrupt" fallacy is parodied in The Simpsons episode where Lisa becomes president. Not only does it have China (amongst other countries) demanding repayment, but Bart (who's grown up to be a deadbeat) is able to use his own money-mooching skills to deflect them ("I totally remember mailing a check to you.")
Aversions (In other words, they get it right or mostly right.)
Aversion
- The comedic Elseworlds book Superman: True Brit: Superman tries to solve the UK's debt by turning all the coal in the British Isles into diamonds. Later at a press conference, a Lord tells Superman that because of "basic economic theory", diamonds are now worth less than coal. Not only does this make Superman's stunt useless, but thousands of coal miners have lost their jobs and there is no coal for people to heat their houses with. Superman (a bit of a Ditz in this universe) then suggests going into outer space and bring back gold from other planets to give to each family, causing the Lord to shout "You just don't get it, do you Superman?"
- The Dystopia Brave New World. Useless, overly complicated stuff (squee! complicated sports involving autogyros!) is made by unnecessary amounts of manual labor not to stimulate the economy, but simply to keep the people busy enough with full-time jobs. It was possible to have a well-running economy with four-hours-a-day jobs, but the experimental projects showed that too much free time proved unsatisfying for the population that would get bored and excessively indulge in the government drug soma.
- Averted as a momentary almost background joke in the Futurama episode "300 Big Boys", where the government declares a one-time refund of $300 per person. The camera pans over a store with the sign "Everything $1" which is being changed to "Everything $300". Possibly the best instantaneous explanation of inflation I have ever seen.
- More like an explanation of opportunism, since the money hadn't even been sent out at that point.
- You say "opportunism" and I say "rational expectations" and that's economics. Yay!
- It's not a particularly rational expectation either, people's wealth wasn't multiplied by 300 it had 300 added to it.
- In an episode of Disney's Aladdin Iago is granted (semi-)Phenomenal (nearly)Cosmic powers for the day, with a few provisos... a few quid-pro-quos... After he distributes conjured gemstones freely to the public, the people of Agrabah all practically worship him, until they realize it takes bushels of rubies just to buy bread.
- Duck Tales has many, many episodes exposing the problems with dumb economic solutions. Huey Duey and Louie find a machine that lets them duplicate dollar coins en masse. Inflation promptly kicks in and loaves of bread cost $200 before they find the reverse switch. This episode was loosely based on Carl Barks' ''A Financial Fable'' and The Fabulous Philosophers Stone which are also notable aversions.
- A fun one involved a civilization which operated entirely on the honor system being intoxicated and then inundated with bottle caps. First they were rare, and everybody wanted one. Then they were common and used as currency, then inflated because Launchpad was air-dropping planeloads in order to break the rarity. They eventually got rid of all the bottle caps just to put a stop to the madness.
- One especially confusing episode shows an alternate future where the triplets ally with Magica DeSpell after Uncle Scrooge goes missing due to Time Travel. The entire economy was reversed, with employees paying the business they worked at. This could mean two things: since Magica was involved, we could just say, A Witch Did It; or taxes have been raised so high, such as "The Privilege of Working for Magica McDuck Enterprises Tax," that getting a paycheck is practically a moot point since just about all your money gets taken out.
- In a Don Rosa Scrooge McDuck story The Quest for Kalevala Scrooge briefly gets his hand on Sampo, a mythic handmill that can produce infinite amounts of gold. Normally business-savvy Scrooge gets struck by a severe case of gold fever, and starts rolling out tons of gold. In a boat. In the middle of a storming sea. The economic implications were left unstudied, since immediate survival quickly becomes a more important matter.
- Of course, knowing Scrooge — he probably wanted more gold just to swim in.
- An Italian Scrooge comic has him trying to hunt down a second-rate philosopher's stone - it can turn any metal into silver - because he owns a majority of the world's silver mines, and its existence would make silver worth much less (presumably, anyone who gets the stone can duplicate it). The Beagle Boys, on the other hand, is merely thrilled at the idea of making silver out of common junk and get rich selling it, and tries to steal it from him.
- A Paul Murry-drawn Mickey Mouse comic has a villain that has discovered a literal mountain made of diamond. This makes him incredibly rich, as long as no one else knows it exists, since he can control the amount he sells. Hence, his villainousness consists of seeing to that no one who has seen his property ever gets away alive...
- The webcomic Nodwick averts this when the party meets up with a kobold accountant, who gets them to spare his life in exchange for advice on how to make the most of their treasure. He introduces them to the idea of inflation, for a start, and suggests they pay more attention to gathering treasures other than gold coins.
- Having slain a dragon, they were subsequently asked to "STOP DESTABILISING OUR ECONOMY!"
- The first Night Watch book explains why that series averts this. It is said that transmutation is relatively simple magic, which could allow the Others (and specifically the Watches) to manufacture money (or any other resource). It is said that most non-Watch Others would be severely limited in the degree to which they could do this, whereas the Watches themselves assign minor Others to the task of managing their business holdings to fund themselves. It's explained that they do this because they don't want to ruin the local economies (which, considering that the books are set in Russia, are bad enough as they are).
- The useless B-Ark people who crash on prehistoric Earth in The Restaurant at the End of the Universe try to set up an economy using leaves as a currency, but there's so many leaves about that they're instantly devalued. Solution: burn the forests.
- Three oppressive Dystopias operate in perpetual war-economies in 1984, with it being explicitly stated even two on one, none of them can win the war. This is done to destroy surplus wealth and keep people's standards of living from getting better. The goal isn't to support their economies, but to keep them down. Using war to deliberately destroy wealth may be insane, but it works.
- It also theorizes that people could be forced to make very large monuments to use up wealth and keep the standard of living low, but war stirs more passion in citizens, and ultimately more love for their leader.
- One wonders, what was the purpose behind artificially depressing standards of living in the first place?
- The people in charge are pointlessly malevolent pyschopaths.
- More practically, people who are struggling just to survive don't have the leisure time to plot revolutions.
- Which is kind of short sighted as those are precisely the kind of people who would throw themselves heart and soul into a revolution. The ones with tons of leisure time and fun things to play with won't dare rock the boat. See Brave New World
- The deliberate waste is only part of the strategy. The Inner Party gets everything (presumably, we don't see a trustworthy account), the Outer Party gets kept in a constant state of near-starvation and invasive surveillance, and the Proles get fed into the war's meat grinder. The Inner Party has no motive to rebel, the Proles are uneducated and distracted by the propaganda and cheap entertainment, and the Outer Party is cut off from each other and the foot soldiers they would need to accomplish anything.
- "We have to destroy man, to save him from himself." These words have been spoken, in one form or another, by about every real-life tyrant, big or small.
- An apparently similar scenario appears in the segment of Katsuhiro Otomo's Memories entitled Cannon Fodder, which depicts a day in the life of a city devoted entirely to firing countless cannons at the unseen, possibly fictional "Moving Cities" of an unknown enemy, with the populace kept in line by an authoritarian government utilising ubiquitous propaganda.
- Averted in the Secret Wars II miniseries. The Beyonder comes to Earth, ostensibly to learn how to wrap his omnipotent mind around the concept of human desire. Being painfully naive about Earth society, he falls under the influence of a crime boss named Vinnie who (among other things) asks the Beyonder to make gold bars for him. Notably, Vinnie specifically cautions the Beyonder not to create too many bars to avoid devaluing the gold.
- Wait, the Beyonder changed an entire building into gold. Spider-Man snagged a solid gold notebook out of the trash, which caused him to have lots of guilt, even though it was in the trash when he took it.
- He's Spider-Man. It's his job to be guilty.
- Similar to the Nodwick example, in Tales Of MU 'Delvers' (adventurers) have one of the highest tax-liabilities in the Imperium, but delving gear is tax-deductible. This encourages delvers to keep most of their wealth in the form of high-end magic items rather than simply flooding the economy with excess gold.
- When Robert A Heinlein was young, he wrote Beyond This Horizon, a Star Trek The Next Generation type society where everyone is given the basics for free. However, unlike Star Trek, they still had money and the economics made sense. He later turned more classically liberal (or, in contemporary American terms, libertarian) and decided that absolute pure capitalism (never seen in Real Life) was the best system.
- In Pumpkin Scissors, we see the sad state of The Empire after the war they've had, in which there was barely any post-war relief efforts done until the formation of Section 3, and even then their jobs are difficult (one of the characters even find that his superiors were intentionally keeping the cost of commodities up by purchasing them from a province where it is more expensive, and the main character suffers something of a Heroic BSOD when the difference between her own lifestyle and those of the people she helps is brought to her attention). Let's not even get to all the effort and resources they've put into the Invisible 9, and you could infer them to having a "Destruction Equals Employment" policy going on by the amount of resources the military gets.
- The Discworld novel "Making Money" does a reasonable job (for a comedic fantasy) of dealing with the transition from coinage to paper currency, and issues like market liquidity, convertibility, and cost of acceptance.
- In the first book, the Patrician tries to explain to Rincewind why Twoflower spreading gold all over Ankh-Morpork is not the Good Thing everyone else believes. Rincewind doesn't really get it. (It indirectly leads to the entire city being burned to the ground, but he was talking about runaway inflation.)
- Between the fact that the (very heavy) gold is from the Counterweight Continent, the purpose of Discworld's spinning being to keep the weight relatively evenly distributed between the elephants holding it up, and the mention of balancing monks who move weights around to keep Discworld balanced, it's just possible that he was suggesting the literal destabilizing of Discworld.
- Averted on, of all things, an episode of Sesame Street when Elmo wishes for every day to be Christmas. After the first few days of this, nearly everyone's parents are broke and the presents are valueless because he has so many of them. As a way of explaining the Law of Diminishing Utility to pre-schoolers, it ain't half-bad.
- The Garin Death Ray is a 1927 Soviet sci-fi novel in which a Mad Scientist intentionally invokes version (1) of this trope in a bid to Take Over The World. He invents a mirror-based laser-like device and uses it to drill a mine shaft deep into the Earth's mantle where, aparantelly, there is a geological layer composed entirely of gold. He then sets sail for the (naturally) evil, corrupt, uber-capistalist United States, starts selling bars of gold for a dollar apiece to anyone who asks, and soon brings the entire economy to its knees (remember, the Gold Standard was still in use at the time). It is then up to our Soviet heroes to dodge Frickin Laser Beams and foil his plot, after which the United States promptly converts to Communism. (Surprisingly, it's Better Than It Sounds).
- In Matthew Reilly's Temple, the Big Bad threatens to destroy the Earth unless he is paid $100 billion, which he then plans to dump on the market at absurdly low prices, destroying the world economy.
- In Fullmetal Alchemist, one of the capital restrictions of State Alchemy is that it is illegal to create gold, as they know it would mess with the economy if they did.
- In Metalocalypse, Nathan takes over Florida and immediately drives the country into the ground by rationalizing that the best way to solve poor people's problems is to print more money. Needless to say, Flordia money is made quite worthless. Nathan went on to destroy the state with a hurricane, though, so nature balanced it out.
- The Fairly Odd Parents: Fairies cannot grant wishes for money because it would necessitate either stealing or counterfeiting, and they are not allowed to grant wishes that break the law.
- Played with in an episode of Malcolm In The Middle; Reese is advising Malcolm via earpiece on how to talk to a girl he likes, and has him state that he wishes the government would turn 1 dollar bills into 100 dollar bills so that nobody would be poor. Malcolm rolls his eyes at the idea, but says it anyway. Fortuantely for him, the girl is as much an idiot as Reese, and takes the idea as a profound statement of social conscience.
- "Murder Most Fowl," a short story by Deborah Militello printed in Dragon Magazine, subverts the Money For Nothing type to hilarious effect. It's set in a world where Jack (he of the Beanstalk fame), has become lord of the realm on the strength of his gold-egg-laying goose. At the beginning of the story, the goose is found strangled, and a hapless courtier is set to finding out who had committed the seemingly senseless crime of destroying the source of the national wealth... only to learn that, in fact, the endless supply of cheap gold was wrecking local industry, undermining the basis of the feudal economy, and threatening to plunge the country into war. Meaning that EVERYONE from King Jack on down had an excellent motive. And then it turns out that the culprit was the one person who had no motive: the castle cook, while drunk, had mistaken it for another goose and wrung its neck with intent to roast.
- The somewhat obscure submarine adventure simulation SubCulture has a quite well-rounded economy. You can gather several raw materials (like, metal, thorium or nicotin) in the ocean and sell them at the various cities; or buy wares from one city, sell it for a profit to another. Buying raises prices, selling lowers them.
Post-Scarcity Economies ( The Singularity has arrived! Technology has advanced to the point that practically anyone can have practically anything for practically nothing. Often involves Nanomachines. In other words, A Wizard Did It - with SCIENCE!)
- Just to head this off: Star Trek is not an example of "post-scarcity". There are things they have limited amounts of (dilithium and latinum) and many examples of interplanetary trade which can only happen if there are people that want/need something that only the other group has.
- Iain M. Banks' The Culture series of books. A "post-scarcity economy" means everyone can (within reason) have anything. Specifically, AI drones or simpler machines do the gruntwork, vastly more powerful (though benign) AI Minds run things, and humans, aliens and other Drones just have to find a purpose for themselves — art, studies, the Contact section, meddling in less advanced cultures, whatever floats your boat. Boatbuilding, if you like.
- "But why bother building a starship if a Mind can do it quicker and better?" "When you go swimming do you care that fish can swim better?"
- There's also some accuracy in that while The Culture itself has no need for currency, they are careful about how their operatives act in societies where there still is a monetary system. For instance, in Excession, they are peeved by the way one character throws money around, and in Use of Weapons, they probably only allow the rather unstable protagonist to spend like a madman, because they are comfortable with him tearing that society apart, allowing them to step in. Granted, it's not all that clear how The Culture has currencies from other civilizations to throw around.
- They use special agents to set up and/or take over businesses native to the planet they're interested in, then carefully introduce technology they have (which is amazing and new stuff to the planets they're doing it to) by allowing that business to "invent" it, which makes those businesses immensely powerful and rich, then they funnel that money around to anyone who needs it. Combined with their ability to hack or just plain steal money from other sources, they have essentially infinite money on any planet they need to.
- It's noticeable that whenever the Culture comes across something that is scarce (a rare alien artifact or tickets to a prestigious concert) they suddenly become considerably more competitive. (In the case of the concert tickets, they ended up basically reintroducing money to allow people to buy tickets.)
- The Second Renaissance cartoon of the Animatrix is an interesting case. It appears to show the Machines achieving an amazing level of efficiency in terms of industrial production, leading to a flooding of Machine imports in Human countries and the fall of humankind's economies, in a manner akin to the Export Good/Import Bad fallacy. The truth is much more complicated, as such a scenario would lead to some human companies/sectors (such as mineral exporters, logistic companies) improving, others (manufacturing companies) as losing, with a large redistribution of wealth in all economies. However, given that industrial output represents only 1/3 of the world economy, it's debatable whether this would lead to the devastating collapse in the manner shown.
- It could also be considered a case of the human nations deliberately using the Export Good/Import Bad fallacy as an excuse for war. At the very least, the capabilities of the Machine civilization would make it an economic superpower - and as the machines are subject to Fantastic Racism in this milieu, this would obviously cause considerable tension. Export Good/Import Bad may be implied, but it may also imply Humans Are Bastards.
- Or the robots did it on purpose to force the humans to attack them to them give an excuse to turn them into the Matrix (ie EM Ps are the robots weakness, how the hell can they take a nuke, which makes EM Ps unless they knew it was coming and prepared for it)
- They are vulnerable to EMP because they are meant to! Real Machine warmachines probably were very nicely EMP shielded. When they created The Matrix, they had to give people hope (not to mention that EMP shielding is quite expensive) . And The Matrix is less efficient than what they had before. And you don't use nukes when you want to conquer, you use nukes when you want to destroy (pretty much the same as Romans salting the ground of Carthago to prevent repopulation). You don't want a nuclear wasteland of your own precious planet. Humans are bastards in The Matrix :).
- And they were about to dominate the Tourism industry as well if the humans had not gone to war and Machines complete the Matrix, allowing the best of all worlds as they make a one stop destination for all vacation venues.
- Gianni Rodari's story Planet of Christmas Trees features a planet on which all work is done by robots and machines and everyone has access to any resources the want, to the point where entire castles are built just to be smashed by people who need to work off some frustration. Also it's always spring (literally), every day is Christmas, and the government has grown unnecessary.
- The Midas Plague features an unusual situation where there is too much production. People are expected to work less and consume more; and the ratio of possessions to social standing is completely inverted. For some reason, probably comedy, the thought of simply reducing production is considered unworkable.
- Not so much comedy as pathos, but the core is a vision of a world upside-down: the rich can buy their way out of the grind and live simple lives without many possessions, while the poor are stuck on a back-breaking treadmill of endless government-mandated consumption, to keep the economy strong and the money moving, I guess. Obviously, it makes less sense as workable system but that wasn't the point.
- Robert Anton Wilson's Schroedinger's Cat-trilogy studies a number of Alternate Universes, including an Utopean one, where a manual labourer who invents a way to automatize his work will get a high standard of living for lifetime, and everybody else in the same business gets a comfortable one, as machines multiply the production rates, allowing a part of the surplus to be used this way, since capitalism requires consumers in order to function. The system has its problems to a careful reader - one would imagine that people would cry foul when major parts of the formerly working class populace get free lunch without doing anything, while others continue to toil at least until someone in their ranks manages to mechanize that particular industry, as well. Still, the people who have jobs that can't be automatized are depicted as the lucky ones, since permanent vacation isn't all that it's cut out to be, and as result adult education flourishes.
- John Ringo's Council series applies before the war. Society and Technology have made it so that everyone gets a ration of power each day, more than enough to provide for a comfortable lifestyle. There is a small scale economy in the background, with some luxury goods produced and traded, but it's hardly essential to the setting. Of course, this lasts perhaps 100 pages into the book, before things go straight to hell.
- The Eldar in Warhammer40000 used to have an economy like this. Their technology had advanced to the point where all work could be done by machnies and everything necessary could be easily produced, eliminated scarcity and the need for labour. It didn't end well, as their society eventually slipped into decadense and resulted in the creation of the Chaos God of Squick, annihilating the majority of Eldar in the process.
- People who live in the civilized empires of Orion's Arm can easily go their entire lives without ever having to work, Archailects can provide anything they need and much of what they want for free. The most common professions are those concerned with rasing the next generation, either through parenting or by altering non-sentient species so that they become intelligent enough to join galactic society.
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