Economics is something that affects each and every person, yet something not many people have had a chance to study in depth. Video games are something that, by and large, have no effect on a person in the long run yet many people have had time to experience. Yes, I know we all had that proud moment the first time we beat Cortex that defined our eight year old lives. But what if the two could be related? What if video games were a closed model that we could analyze to help better understand our own world? Or better yet what if we could learn some basic principles of the economy by studying video games? I hope for this to be the first of multiple articles exploring the connection between the two.
Exploring economic systems is something that takes time. Trying to capture it all in one article is ludicrous, considering to get a degree it requires a mastery of multiple textbooks amounting to thousands of pages. At its core economics is about value, perceived or actual. The value of all goods and services are measured in money. Because of this I want to begin with exploring the currencies of imaginary worlds. For the sake of this article we will be looking at the currencies of the "Dragon Age" Universe, a fairly successful game by Bioware. Its use of multiple kingdoms, their respective coinage, and international trade makes it a great starting point for looking at how value is derived.
To put the universe in context all of the games take place in Thedas, one of the continents in the world of "Dragon Age". Across Thedas there are multiple Kingdoms and collections of city states. Some produce currency with different symbols on them but as evidence by the travels of the heroes these currencies all experience the same exchange rate (100 bronze pieces for one silver, 100 silver pieces for one gold). In addition these all seem to carry the same value across all nations. No matter what stamp is on a gold coin or what they may call it in that part of Thedas it has the same value in all countries. As an example a single gold coin is called a Sovereign in the nation of Ferelden and a Royal in Orlais.
The first explanation for this is something we call in economics Mint Parity. This theory states that an exchange rate between two currencies can be determined based on the amount of currency being produced based on what is backing it. In more modern times this would refer to the gold standard and how many units of currency a country would produce for each ounce of gold. We could then use the amount being produced to figure out the exchange rate. For example; if country A produces five units for one ounce of gold and country B produces 10 units we can then infer that one unit of country A’s currency is worth two of county B’s currency. According to the Theory of Mint Parity this is because each unit of country A’s currency is backed by more gold, 20 percent of an ounce of gold versus 10 percent of an ounce in country B. In a universe where the precious metal is the currency, it would be based on the weight of the metal being use to create each coin. The 1 to 1 ratio of currency exchange across Thedas implies then that they same exact amount of metal goes into each coin across the continent. However there is a second explanation for why some currency is uniform.
Kirkwall, the setting of the second game in the series, is located in the Free Marches. For those who have not played the series the Free Marches are a collection of city states that are mostly self governed besides when a sizable threat is posed. Kirkwall is located on the water and had an economy that prior to the start of the game was based on slave trade. Now many people from across the land come to the city for other forms of trade. In addition there is a large influx of Fereldens due to the outbreak of something known as the blight attacking their country. All of this makes Kirkwall a hub for economic activity. In addition, since Kirkwall is a city state it is most likely incapable of producing everything it needs internally in the way that a country could. Therefore it makes sense that they would adopt another nation’s currency. The use of another country’s currency as legal tender is commonly referred to as dollarization. Since Kirkwall is located near Ferelden they use their currency as the official tender. In addition it makes sense for this city state to use vehicle currencies as it is a hub for trade. Vehicle currencies are currencies used in transactions where neither party is from the country that the tender is associated. For instance, a transaction between someone of Kirkwall and someone from Orlais. As a hub for trade without a connection to a larger nation it makes perfect economic sense for Kirkwall to accept the tender of their largest trade partners.
This was a simplistic explanation of the value of currency using the world of a video game as a way to better understand the economies of our own world. Sometimes terminology can be confusing especially when the examples you have are entirely theoretical. My goal is to use an established system that is more accessible and commonly known. Also, looking at a video game allows us to apply theories in a world that is not subject to rapid fluctuation in the way that our own is. I hope you enjoyed this and found it educational. So next time you slay a marauder and take their riches, think about how and why you can spend that money.
