Most DKP systems run into the problem of DKP inflation which invariably ruins the system over the long term. I have devised a system that utilizes inflation in the same way that real world economics utilizes it. This concept can be applied to a zero sum system as well as a direct point system, but I'll outline my idea for an overall inlfation-based system.

The basic premise of the system is to inflate the values of all DKP Awards as well as all DKP Expenditures across the board. It would follow a week-to-week (or month-to-month depending on how it is customized) inflation where the prior value is multiplied by the inflation constant.

Example where the coefficient is 1.200 (ie the values go up 20% each week). The value of C'thun on Week1 might be 5.00 dkp and his drop might cost 50 dkp. The following week he is worth 6 dkp and the same drop costs 60 dkp. The third week he is worth 7.20 DKP and the same item costs 72 DKP.

This solution resolves many problems associated with inflation by accounting for inflation directly in the system itself. No more need to worry about new members being 1000 DKP behind because they are getting the highest DKP awards to-date. You can quickly see how it is nearly impossible to bank huge DKP sums and have a perpetual lead despite bad attendence when DKP you earned in the past isnt worth as much.

As a comparison to real-world economics, imagine a man who has $100 dollars in 1900 compared to a man with $100 dollars in 2006. The amount of money is the same, but the relative purchasing power of the money is an amazingly stark contrast, and the earned income of a person in the two time periods is similarly slanted. This concept uses inflation to resolve the same issues that inflation resolves real-world economic issues, where you cannot bank money(dkp) and expect it to be as valuable in the future. The DKP you have is at it's most valuable in the present. This will encourage people to want to loot, will solve inflation problems, will eliminate MIA problems where people come back after a hiatus and still have large sums of banked DKP, and will lead to higher attendence because people won't want to miss the DKP - since it's the most they have ever gotten for the same bosses.

Note: This concept is customizable in multiple ways and across multiple systems: The coefficient value, the time period, the original base item and boss values, etc.

Loerna - Windrunner Priest (Forlorn Legacy)

Isn't this essentially just a flat-tax system in reverse?

i.e. what is the effective difference between this, and applying a weekly/monthly/raidly 10% tax to currently held DKP?

This is a really good idea.

Would something like this be an absolute bitch to manage or would it be doable to adapt an EQDKP style management systems for it?

I have nothing insightful to add, but very interesting idea.

How to address the issue of people hoarding DKP since UBRS (basically) for T3 stuff, when MC has been on farm for over a half of a year. >_>

Well, you just make a "signature" with your ctprofile like a few of us have done. I have to imagine something on the left would require actual coding or template changes or something.

EDIT: so you can see my sig

The difference being that nobody is treated differently. I have 100 DKP and lose 10 to 10% tax. Someone with 10 DKP only loses 1 DKP. I lose 9x as much simply because I have accumulated more. With the inflation method I keep my 100, they keep their 10, and we both spend 5 additional DKP for the next drops we acquire. The inherent punishment to all players in the system should be uniform. It's more like comparing a compound Sales-Tax/Wage Increase to a flat-tax.

Shouldn't be a hard fix and it's a good idea -- I'll talk to Boethius about it. Anyway, back to DKP discussion.

I don't think this idea could be called inflation based. This system could easily be used in a zero sum system. The costs of items go up as time goes on. This would certainly penalize people that hoarded.

Right now we significantly increase the cost of items for each tier. So AQ gear might cost 60-90 rpp while nax gear will cost 200-300 rpp. This stops people from trying to hoard points in AQ when Naxx is about to be released, but does allow people that have everything they could possibly want to be rewarded an item or two for continuing to raid.

Interesting idea, none the less. I was toying around with the idea of a percentage based tax and then evenly redistributing the taxed points based on participation percentage. This woudl encourage people to spend their points instead of hoarding them.

Is this how actual economies function - with a constant rate of inflation? It seems like it might make more sense to tie it to the amount of points currently in the system, the rate of income, or possibly just the time since the system began. Disclaimer: I have no relevant economics knowledge, I'm not trying to correct you. Just curious.

I don't see how it's any better than fixed-price zero-sum. Most of the problems of fixed-price zero-sum come from pricing issues. I.e. how do we price items compared to the other items out there? (Note that ugprade rule and "pay the difference" schemes basically just tackle this fundamental idea).

Your system simply pawns off this problem to instead of pricing being the big problem, figuring out the decay coefficients being the problem. So you've transformed the problem from "how do you do pricing" (not terribly easy, but people at least have a general idea), to a macroeconomic question of "what are people's rate of time preference" (how many people even know what that phrase means)?

I've studied econ for 7 years (and game/auction theory for 4) and I honestly have no clue where or how you could intelligently come up with decay coefficient. Without this coefficient being "correct", you're still going to suffer overinflation or deflation, with a very good chance of making it worse than before.

So in summary, the idea isn't terribly bad in theory. However neither is fixed-price zero-sum. However to try and solve the problems with fixed-price zero-sum, you pawn it off onto determining something that is even more difficult to determine than pricing in the first place.

Edit: yeah by decay coefficient i mean "inflation coefficient". One of the posters above is correct that this is macrocosmically equivalent to a flattax, though the %'s will differ.

How will you measure the current inflation rate?