ALEX: This is what I get for doing a brief response over my morning coffee! Thoughts below.
If a sword +1 only has a value of ~1500 gp, why do mages ever make them? If making magic items doesn’t produce value for the spellcaster, why is there a functioning (and expensive) market in monster parts? Also, isn’t the cost of a magic sword 10,000–5000 in gold plus 5000 in monster parts? Sure, that gets halved to 5000, but why halve it again? Why would a mage ever buy monster parts to make into a magic item that’s worth less than the monster parts were?
ALEX: Several responses here! First, let me be clear that I was talking about the value of unidentified magic items found by adventurers in dungeons. The value of a sword +1 in other contexts could vary dramatically.
I agree that magic item markets would be illiquid, full of information problems, and so forth. I’m not suggesting that you can walk into your local magic item shop and buy an off the rack sword +1. I’m also not suggesting that PCs can sell magic items that they find in a dungeon for top gold piece values.
ALEX: Agreed in full!
But if spellcasters regularly make magic items, enough to create a liquid market in monster parts, they must be doing that for a reason.
ALEX: I think there are three main reasons why spellcasters would make magic items. First, they may do it for the experience. This may seem silly, but consider that every year, millions of doctoral thesis are written at enormous time and expense, almost none of which ever have market value or even see a market at all. They are created simply for the experience gained in creating a doctoral thesis. Likewise with the many experiments of Renaissance and Enlightenment gentleman-scholars, or the many odd pieces of code and script written by modern hackers. Let’s call this “experiential creation”.
ALEX: Second, they may do it for their own utility. For instance, a mage may desire to have a ring of protection in order to protect himself. Let’s call this “personal creation”.
ALEX: Third, they may do it on commission – let’s call this “bespoke creation”.
When the Exarch Lazar’s vassal’s eldest child comes of age, and the Exarch decides to give a princely gift (partly to demonstrate his wealth and power, partly to secure the vassal’s loyalty, partly to secure the vassal’s child’s loyalty, partly because it’s socially expected), I would think that giving the young noble a magic sword would be a perfectly normal gift, bearing in mind that the Exarch’s realm gives him something like 1.4 million gold pieces in revenue per month. Actually, an exarch with a treasury of millions of gold pieces probably gives a much better gift to a relatively close associate than just a +1 sword, because a +1 sword doesn’t demonstrate much wealth and power, but let’s continue the example. So, where does the Exarch get that magic sword? One possibility is that he has a mage retainer make the sword, at a cost of 2500 gold plus 2500 gold in monster parts. That makes sense if Exarch Lazar values a magic sword at more than 5000 gold plus the mage retainer’s time.
ALEX: This is a great example of bespoke magic item creation.
Of course, if there are scads of magic swords in the dungeons of Southern Argolle, then he might simply have an existing sword IDed to make sure it’s not cursed, and give that instead. So it only makes sense for him to have his vassal mage make a sword if the sword is worth at least 5000 gp–perhaps in part because he wants a magic item with a known provenance so that he can assure his vassal, “don’t worry, there aren’t any curses, this was custom made for your child.” And consider the mage’s perspective. A mage has to have a good reason for doing the work–otherwise, why buy all these monster parts and spend all of this gold?
ALEX: I don’t think that there has to be an “open market” price of 5000gp in order for a mage to be able to justify charging well more than 5,000gp for a bespoke sword. The bespoke sword doesn’t even need to be functionally better. It can make sense for Lazar to spend at least 5,000gp if doing so creates an item with social status. I would assume that the hilt of the Lazar sword would be adorned with the silver and blue colors of the Lazar family, and perhaps it would have a motto etched in runes on its blade. The pommel might be fastened in a shape of a tower, which is the Lazar family symbol. The blade could have the wizard’s mark who made it – perhaps a famous wizard. It could come with a scroll announcing the day of its creation and the parts used to make (“Its edged was quenched in the blood of ogre champions slain by Marcus Odysios during the Great Invasion.”) All of this adds enormously to the value of something. It’s like buying a ROLEX, or a Porsche, or a bespoke suit from Saville Row.
I would expect that to produce a bifurcated market, much like the real-world market for cars. On the one hand, you have brand-new cars, which have a high cost, substantially higher than the costs of manufacture. The analogy to that is the made to order magic item market–if you go to the right wizard’s tower, and plunk down a large enough bag of gold, she’ll make you a magic item, but you’ll have to pay her for her time as well as the full cost of the components (i.e., 2500 gp for the gold cost, 2500 gp for the monster parts, plus compensation for her very valuable time). You’re going to end up spending a small fortune.
ALEX: I agree completely!
There’s also a highly illiquid and messy market for used cars, which sell below their manufacture costs but have problems associated with them. And some of them may have clouded titles, because they were stolen or whatever. That’s the equivalent of selling a magic item you found in a dungeon. And those may sell at substantially below manufacture costs, at least if you need to sell it now (if you’re willing to do lots of merchantly legwork, you might get a higher price).
ALEX: I agree completely.
But if the market for the second set of items is really depressed–if magic swords have an actual market value of something like 1500 gp, because you also need 1000 gp for the mechanic (I mean the mage) who IDs them, then it’s probably because characters don’t actually value magic items very highly.
ALEX: Not necessarily true. With used cars, part of the reason a used car’s value plummets when you drive it off the lot is that the market assumes that if you want to sell such a new car, there must be something wrong with it. This is also true when business owners try to sell their business – if you think it’s such a great business, why great rid of it? I believe this would be the case with magic items. If you want to sell them, there’d be an immediate assumption that there’s something wrong. So it’s not necessarily that characters don’t value items, it’s that buyers assume sellers don’t value the item for suspicious reasons. OR that they are desperate for cash and can be taken care of. And keep in mind that these aren’t just used items. They’re stolen used items that got dug out of some godforsaken crypt where they’ve lingered in the clutches of the dark powers.
They’d much rather have the cash. And if that’s true, then the made-to-order market probably also doesn’t exist–you destroy value when you turn some cash and some nice ogre skulls into a worthless old magic sword. And mages probably don’t make magic items for their own purposes either, because they’d rather have the cash to hire a bigger army or something. But that implies that the whole monster parts economy collapses.
ALEX: I disagree with you here. There would continue to be a market for monster parts because of experiential, personal, and bespoke magic item creation. I also assume monster parts have a trophy/decorative function, similar way to the ivory trade, ostrich feathers, bear skins, etc. “This couch is made with real Naga hide? Wow!”
And what about the refurbished market? If I were a high level spellcaster who could sell a newly made magic sword for 10,000 gold or whatever, I bet that I could sell a pre-identified, guaranteed safe used magic sword for 8,000 gp. At that point, I’d certainly be willing to buy your used magic sword for 4000 gp or something, contingent on the identify process coming out okay, at least if I had plenty of ready cash. That’s like the factory certified, dealer sold used car market.
ALEX: I agree with you here somewhat here. In the Auran Empire campaign, a chapter of wizards that operates something called the Tower of Knowledge will buy magic items for cheap, evaluate them, and re-sell them at a higher price later. I’ve contemplated whether there should be some system in place to evaluate what sort of items might be for sale on the secondary market.
The traditional way to handle this in fantasy gaming is, I believe, tails I win, heads you lose. “You want to sell your magic sword? Oh, no one wants to buy a used magic sword… they’re not that valuable and it could be cursed. And even if you made it from scratch, they don’t trust you and won’t pay you even what you spent on making it. I guess you could get 1000 gp for it.” “Oh, you want to buy a magic sword? Well, they’re really valuable, and the people who have them don’t want to sell them. I guess you could get a high level mage to make you one, or pay a desperate noble a fortune for an existing one… but it will run you like 15000 gp.” In a sense, that works. It forces the PCs to adventure for wealth. It means that when they find a magic sword in the treasure hoard, it’s extra exciting, because they can’t buy it. And it means that magic items don’t get treated as another form of gold. But it doesn’t make a lot of sense. I believe that it’s directly contrary to the “the whole economic system makes sense” ethos of ACKS.
ALEX: Perhaps this is the crux of our disagreement. I think that sort of price disparity makes total sense! “Tails I win, heads you lose” is how most markets operate. Have you ever tried to buy jewelry? Let’s say you buy jewelry from Tiffany’s for thousands of dollars. Later, you try to resell that jewelry. You will be lucky to sell it for hundreds of dollars. Or look at Gamestop’s used game practices. Sell a used game to Gamestop and they will pay about $5. But if you buy the same used game from Gamestop it will cost you $30. (And that’s despite the existence of eBay markets for both!) In an ancient/medieval world filled with force, fraud, curses, information asymmetry, and more, this will be even worse.
ALEX: The strange thing about our modern economy is that we’ve managed to eliminate this price asymmetry in some places, with eBay and so on, not that this price asymmetry exists. Price asymmetry should exist. For most of history, everything other than commodities has by and large been priced like jewelry. We take for granted in our modern eBay economy that anyone can sell anything and get something approaching a market price, but in fact, most of the time, markets have been characterized by deep information asymmetries. If Marcus the Fighter finds a magic sword +1 in dungeon and tries to sell it in town, he’s not going to get anywhere near what it would cost Quintus the Mage to make a sword +1. On the other hand, if Marcus realizes that the sword is Surdigan, blade of the Surdius family of Arganos, and he has the blade cleaned, identified by a sage (1,000gp), and transported to Arganos, where a merchant meets with the Surdius family on his behalf (10% commission), maybe they’ll pay for it. Or maybe they’ll demand it as a right, as stolen property…