Saturday, March 31, 2007

An Experiment with Investment

Civilization: China
Difficulty: Settler
Game Speed: Normal

Yes, I returned to China. I don't have to explain this; one only has to read my previous blog about my enormous success as China to understand my motivations. The more pertinent issue is whether or not my game is going better, worse, or about the same as my first attempt playing China, and why. But first, I must explain my premise for the game.

I'm conducting an "experiment" with the percentage of my imperial coffers going toward technological research, cultural research, and wealth accumulation. In the past, I've started the game with 50% percent going towards technology, dropping it to 30% when I gain the ability to research culture (which gets its own 30%). I hadn't given this practice much thought until I read someone else's blog (http://nautilus009.blogspot.com/), which mentioned upping the amount of resources going to technological research when the game entered the Industrial Era. This got me thinking, and so when I started my latest game I decided to do something different and see what happened. This game, I started my technological research at 70%, only lowering it to 60% when I discovered music and received the ability to research culture, to which I allocated just 10% of my resources. I would have kept the percentage higher, but this resulted in me accumulating a negative amount of gold per turn, which I did not think would be beneficial.

What do I expect increased technological research to achieve? My main thought was of Heilbroner, who on page 118 briefly discusses the importance of investment expenditure to economic prosperity. In an economic context, investment "means devoting labor and other inputs to the creation of capital goods" (Heilbroner 74). Capital goods are "the stock of tools, equipment, machines, and buildings that society produces in order to expedite the production process" (72), and Heilbroner makes the interesting point that they "give people mechanical and physico-chemical powers of literally transhuman dimensions" (73).

With the definitions out of the way, back to the point: Essentially, the more resources a society invests in the production of capital, the more prosperous it will be. I took technological research to be the Civ equivalent of capital investment, since it allows you to use more advanced, more productive tools in the expansion of your empire. And so, I reasoned that if I focused on technological advancement I would be more prosperous than in previous games.

Was I right? It's a little too early to tell, but I have definitely advanced faster: I reached the Modern Era in 1815. The first time I played China, I didn't get to the Modern Era until 1900, and I didn't even get there in my last game, only entering the Industrial Era in 1914. My population is lagging behind a little since the last time I played China, but I've just discovered flight and built some bombers, which offer great opportunities for conquest. I'm optimistic about my experiment. For results, tune in next week. I promise it will be exciting. ;)

References:
Heilbroner, Robert L. and William Milberg. The Making of Economic Society. 12th ed.

Friday, March 23, 2007

Ignorance Is NOT Bliss and Other Hard Lessons

No victory this time, not even a time victory. I take pride in the fact that, though my civilization was weak, I was not conquered, but a rocky start hobbles the rest of your game, no matter how brilliantly you play it. And to be honest, I did not play brilliantly.

For a reminder, I played Persia, selecting that particular empire because of its geographic location and the supposed advantages to be derived thereof. A good theory, but in practice I was harassed by barbarians, constricted by neighbors, and generally prevented from building an empire "to stand the test of time," as the game says at the beginning. Once I'd finally secured my borders from barbarian attack, I became caught up in the blood lust of my neighbors (who kept asking me to join with them in declaring war on some third party) and foolishly declared war on Mongolia. I was in no financial or technological position for any large-scale conflict and, realizing thin, I quickly signed a peace treaty with Genghis Khan. Not long after this, Greece declared war on me. In my one clever move of the game, I persuaded Egypt, China, India, and Rome to declare war on Greece. Thus, Alexander was distracted, my empire was saved from destruction, and Greece was conquered. It pays to have good relations with your neighbors.

After Greece was subdued, I began rebuilding my damaged infrastructure. This didn't take terribly long, but it cost my already small, weak empire precious development time. I was still recovering when Germany achieved a space race victory. And so ended my third game of Civ, the first game in which I did not achieve some manifestation of victory. This was no surprise, and at least by the third time around I was able to accept the now-expected comparison to Dan Quayle without indignation.

Going through my scores, I cringed at my poor performance: Number one in no category, only one city in the top five, only twelve cities built. Embarrassing. However, when I finally reached the Hall of Fame, I realized that the game's difficulty level was listed as "Noble," not "Settler" as I had intended. I must have forgotten to change the difficulty when I was setting up the game. Seeing that, everything clicked: The constant harassment wasn't just because of Persia's position; it had to do with the increased difficulty. And my less than stellar performance was the result of a flawed premise--my belief that I was playing "Settler" level. . . . I managed to rack up an unprecedented number of stupidity points this game.

I know I've rambled on somewhat about how and why I lost, but my mediocre game reveals an important economic concept. In the chapter on the Industrial Revolution (Chapter 4), Heilbroner talks about the importance of saving and investment. "Saving is the releasing of resources from consumption; investment is the employment of these resources in making capital" (pg 74). According to Heilbroner, rich societies with unemployed resources can build capital without decreasing consumption; however, poor societies with little or no unemployed resources must somehow decrease consumption. This is a difficult feat and results in slow growth. Though Heilbroner does not explicitly say so, slow growth would also lead to slow recovery were the society's fragile economy to experience some kind of hardship. My game clearly displays this: Repeated barbarian attacks caused Persia serious economic setbacks during the crucial formative stages, and it never truly recovered from these setbacks. Growth was always slow, placing the Persian "empire" behind others and leaving it even more vulnerable as a target for conquest. The slow growth is pointedly illustrated in one telling comparison: In this game, I reached the Industrial Era in 1914; last game, when I played China and was able to develop virtually unmolested, I entered the Industrial Era in 1680. I never realized just how difficult growth can be until this game.

In sum, the important lessons learned from game three are:
1. Ignorance is not bliss; knowing things like the difficulty level are key in planning strategy.
2. Do NOT declare war on another empire if you do not have the means to achieve victory! You'll just wind up draining your resources and embarrassing yourself.
3. If a more powerful empire declares war on you, try to persuade friends (who are hopefully even more powerful than your enemy) to declare war on the offending empire. Hint: This works much better if you have good relations with your neighbors.
4. The beginning of the game is arguably the most important for the development of your empire. Focus on expansion, but also on defense. Expansion will do you no good if your outlying cities are constantly ransacked. The beginning is the period to get ahead, so make the most of it!

I think I have imparted enough Civ wisdom for one night. In my next game, I think I'll go back to playing China. I had great success as China, and I have a soft spot for Qin Shi Huang. . . . Or maybe I'll play Germany. Germany seems to begin in a rather out-of-the-way, isolated position. But then, so does Japan. We'll see.

References:
Heilbroner, Robert L. and William Milberg. The Making of Economic Society. 12th ed.

Friday, March 2, 2007

Expansion and Demand: Relating Real Economics to the Quest for World Domination

"Quantity demanded falls as prices rise, other things constant." Thus runs one version of the law of demand as defined by Collander. (pg 91) (This definition can also be reversed to read "quantity demanded rises as prices fall, other things constant.") At first glance it may seem that this concept could not be any more remote from fictitious conquests led by long-dead generals. Yet the law of demand is highly relevant to expanding empires. How? you may ask. Read on, dear blog peruser, and you shall see.

But first let's back up. We all know how a game of Civ IV starts: You, the illustrious head of a would-be empire, are dumped on Earth with nothing but a Settler unit and a Warrior unit, ignorant of pretty much everything (terrain, location of resources, existence of potential enemies, shape of the continents, etc.). From these humble beginnings, you proceed to construct the skeleton of a world power. And what forms this skeleton? Well, military is important, as are population and resources. But you need one crucial element before you can grow a population, found a military, and hunt for resources--before you can do anything else. You need land.

Land is central to the formation of an empire, a centrality illustrated by the fact that the very first act of any game is to found a city. We've heard this argument from Diamond in Guns, Germs, and Steel: Land feels people, provides raw resources like timber, stone, and iron, and provides something concrete and immovable for military to defend. Can you imagine a country existing that possessed no physical territory? It defies our very concept of a nation state.

Anyway, back to the point--how does territorial expansion relate to the law of demand? It's quite simple, really. When empires are first founded, there is an enormous amount of available land at a relatively cheap "price": If you can plant a city there (and defend said city from marauding barbarians), it's yours. Also, demand is high (as the law states it should be) because let's face it, empires need land for food and resources. Intially, empires expand quickly, gobbling up land adjacent to their capitals and spreading from there. However, as the empires reach a level of sustainability and start to rub borders with other empires, the rapid pace of initial expansion slows somewhat. In other words, the demand decreases. This is due partly to decreased availability but is also directly related to the increased "cost" of land. Once another empire has claimed a plot of dirt, the "price" of acquiring it increases dramitically because now, if you want it, you must fight for it. War is a very expensive and risky enterprise, so you have to want (or need) land particually badly to attempt to wrest it from another empire by force. Most empires try to avoid the costs and risks of war, which means demand for land drops sharply. Or, as Collander states it, "quantity demanded falls as prices rise, other things constant."

There are, of course, other ways to get land than by bloody conquest. If you're playing on Earth, you start on the Eurasian continent, and by the time Eurasia and Africa start to get crowded it's possible to develop the technology to launch an expedition to America. Yet even this is more expensive. Starting cities so far away takes extra resources--particularly military, since you have to defend against the small barbarian settlements over there. You have to know what you're doing to keep these sorts of colonization attempts from turning into suicide missions. (I speak from experience.) Again, cost is much higher than crossing the valley and planting your flag on the next hill. Thus demand (willingness and ability to "pay" for such expansion) decreases.

I have deliberately avoided any discussion of supply. My reason is simple: the law of supply assumes there is a "supplier" attempting to derive profit from the sale of some commodity. In the case of territorial expansion in Civ IV, there is no supplier, no real estate agent trying to convince China to pay a few extra bucks for plot X because it offer an ideal avenue for launching an attack on Mongolia. Empires could conceivably function as suppliers, but I can't imagine any emperor/empress selling his or her land except under extreme duress. That is why I have not discussed the law of supply in this post: I do not believe it functions (or if it does function, it does so weakly) in the expansion efforts of the various empires.

Well, there you have it. Territorial expansion reflects the law of demand. Economics really can be applied to Civ IV. Who would have thought it.

Works referenced:
Guns, Germs, and Steel by Jared Diamond
Economics, sixth edition, by David C. Collander (Chapter Four)