Quote:
Originally Posted by romeus petrus
High demand = high price (which is a fact unless you love to argue)
Buyer #1 sees an item that he likes at the auction house and bids say 100k for it.
Buyer # 2 sees the same item and decides that this item (to him) is worth more than that and he bids 200k on it
Buyer #3 wants it even more and bids 300k for it
The more ppl wanting it = the more the demand = the higher the price is going to be.
Whereas in a market place the item would have sold for 100k and the seller would have lost 200k because he had no idea how much in demand that item was.
Clearly the reverse is true, as if there was no demand for the item.
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How can you write this and not say that an AH is manipulating/inflating prices?
If i'm an extremely rich GW player and I see some brand spanking new item that just fell from the zaishen chest I'll be able to bid 100k + XX ectos. This skyrockets the price of the item putting it well out of the range of every casual GW player. You've stated yourself that the AH causes prices to rise. Call this case 1.
Had the XMP been in place rather than an AH for that situation, the person who got the extremely rare new drop instead lists the item at a particular value say 100k. Suddenly almost the entire GW market has access to that item, the person who clicks the fastest is the winner and gains said item. Call this case 2.
Now consider both of these situations, as more of the new rare item are found, in the situation of case 1, each and every one of those items are going to be based around that huge inflated price it was first sold at. THe item is posted with starting bids well out of the range of most players. In case 2, the price is set around what the player chooses to set it at. Heres where supply and demand comes in, if the player sets his price too high, no one will buy said item so he lowers it to try and create demand. Extremely rich players are unable to raise the price that the seller is asking for and thus the item is available to more.
To try and use RL example, lets say a brand new car has just been released. This car isn't necessarily extremely difficult to produce nor is it made of extremely high end materials it might cost only 20 or 30 thousand to make, however it is
new. The company who produces the car doesn't specifiy a set price for it and instead opens the car up for auction. Some extremely rich buisness man sees this car and thinks, "I don't have this vehicle and its a brand new design." He goes out and buys it for 1 000 000. The car company notices how much was paid for it and thus sets an asking price for this car at the 800 000 mark. The price was set as a reflection of what the person the extremely rich person decided to pay for it.
Now if the car company sets the price at 60 000 or 70 000, thats their asking price it won't change. An extremely rich person will just buy it and that price while the car is also in the price range of the general public.
I'm not saying an AH is bad or it wouldn't fit into the GW economy, I'm just saying that its certainly possible for an AH to manipulate prices and cause infaltion.