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Interstellar Economics

Started by flyingmice, August 24, 2007, 09:12:41 AM

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jeff37923

A note on getting stuff into orbit, today we use a very inefficient method of launching payloads. Within the realm of possibility, and actually being developed now, are both mass driver launch systems and laser launch systems which will drop the dollar per pound price of getting into orbit down into the range of the average American household and not in the range of governments and corporations.

And remember, once in orbit, you're halfway to anywhere.
"Meh."

JohnnyWannabe

Quote from: jeff37923A note on getting stuff into orbit, today we use a very inefficient method of launching payloads. Within the realm of possibility, and actually being developed now, are both mass driver launch systems and laser launch systems which will drop the dollar per pound price of getting into orbit down into the range of the average American household and not in the range of governments and corporations.

Yeah, I've adopted this "super gun" idea into some of my games.
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estar

Quote from: SettembriniClash,

I donĀ“t see a big difference between your "formula" and the Far Trader model.
After all the FT version is just one instance of cost variables.

EDIT: The per unit price is important, but that goes without saying, and is also included in both models.

Far Trader relies heavily on the Traveller premise. The presence of Grav Technology and Traveller's Jump Technology makes all the difference. In Traveller the fuel cost (Hydrogen) is small compared to the value of the cargo carried. The cost of going from surface to orbit to jump point is virtually free as it relies on fusion engines powering maneuver drives.

This makes shipping bulk good competitive for trading. A world can focus on industry, mining, etc at the expense of food production and come out ahead. Not all worlds will do this particularly terra normal worlds.

However if you talking about 2300AD then the equation will change. Because 2300 AD interstellar travel may be cheap the cost from going from surface to orbit is still very expensive as high fuel to mass ratio vehicles are still need. There is one important exception in the 2300 AD universe and that is the presence of beanstalks which cuts shipping cost from surface to orbit by several order of magnitude. But given that only two planets have them (Beta Canum Venticorum and Earth) they have limited impact on 2300 AD's economic. If Tirane (one of the core worlds of 2300 AD) gets a beanstalk then 2300AD may develop trading in bulk goods.

Today's example is Japan's need to import foodstuff. Highly Industrialized Japan doesn't have the room to grow food for all of its population. In contrast the US is like a Industrialized Terra Normal world. It highly industrialized yet capable of feeding itself and has enough for a healthy export market.

The presence of Interstellar Bulk Trade is dependent on both technology and specific circumstances of the individual worlds. But it not going to be a rare thing that worlds will need some type of bulk trade.

As for the PC Free Trader, in general they will not participate in the bulk trade if it exists. First because the bulk carriers will out compete them in price. Second, even if they had a bulk cargo to carry it will be so close to the cost of carrying it they will be looking for any other cargo to carry to increase their profit margin. The average sf rpg doesn't have to spend a lot of text or rule space on the bulk trade. None if the technology and worlds wouldn't support its existance.

Xanther

Quote from: flyingmiceHere's a simple formula to get your basic cost of transport:

((Cost of fuel expended) + (crew wages over period) + (consumables expended)  + (cost of vessel over period) + (insurance costs over period)) * 1.5 = Base Cost of Transport (BCT)

Cost of Vessel over Period would be the mortgage or lease cost of the vessel divided by the mortgage or lease period and times the period in question. If you don't have a mortgage or lease cost, it would be the book value divided by the depreciation period times the period in question.

If you are speculating, that is buying goods in system A and selling them in system B as opposed to delivery for hire, you should also add in the cost of the trade goods.

The times 1.5 is a factor to account for incidentals like repairs.

This amount has to be bettered in the Payment for Goods Delivered (PGD) for the ship to make a profit. Payment for goods delivered can be value of the goods sold, payment for delivery, or a combination. The PGD also has to be matched to the Base Cost of Transport on the outbound journey, as below:

BCT Inbound + BCT Outbound < PGD Inbound + PGD Outbound

This is a very dumbed down but fundamentally sound method, good for any setting from fantasy to SF. There are interesting things you can do like arbitraging, but that's beyond the scope of a little post on the net.

-clash

Formula looks good, but could just boil it down to (BCT + COG) < PGD, if you want a profit where COG is cost of goods.  :) The question, however, is it more cost effective to import or grow locally.  If we have a Local Production Cost (LPC) that is greater than PGD then it will be better to ship it in. So:

(BCT +COG) Or (BCT + COG) < PGD < LCP.  

It's the BCT, COG and LCP which will depend upon your setting assumptions.  
If you assume tech makes COG~LCP or BCT >> LCP for foodstuffs, then yes shipping food will make little sense.

A more refined estimate might take into account Lost Opportunity Costs (LOC).  That is locally you get a better return on producing X than Y.  So even if you can produce Y locally you make a much better return on producing X.  The final equation that determines whether you should import is then:

(BCT +COG) < PGD < (LCP + LOC)

This can apply to any import decision not just interstellar.  For example, aircraft vs. present day shipping just differs in BCT.  

Getting even more complex, it may make strategic sense to grow your own food, you'd hate to be held hostage by food shipments.  Let's add  strategic disadvantage cost (SDC) into the equation:

(BCT +  COG + SDC) < PGD < (LCP +LOC)

My 2 credits worth.
 

pspahn

Look here, George Lucas said all food had to be shipped into Coruscant and I'm sure he's done all the necessary research, so this discussion is pointless.  

:)

Pete
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riprock

Quote from: estarI understand your formula. Economics is not all about controlling cost.

You have airlift moon Alpha
You have earthlike planet Delta

Food cost 1000 credit per ton to produce on Delta
Food cost 2000 credit per ton to product on Alpha (dirt beats hydroponics)

One big objection to Traveller is that Miller seemed to think that dirt would beat hydroponics, aeroponics, closed-loop organic composting, etc.

There are real live techies who would dispute that even for 21st century Earth.  If we go from *their* premises, we open up another range of possibilities.

Similarly in a later post you wrote:
QuoteHighly Industrialized Japan doesn't have the room to grow food for all of its population.

It might be impossible economically, but it's not impossible technically, *if* they use enough aeroponics, hydroponics, and raised-bed gardens.  Perhaps that case is so far-fetched that it's only of interest to agriculture geeks.


Quote from: estar10 ton of food per month is per acre of hydroponic
1 ton from Alpha to Alpha costs 100 credits and 1 day to ship
1 ton from Delta to Alpha costs 1000 credits and 10 days to ship

One colonist needs 1 ton per month to survive

His food grown on Delta costs 2100 to his table
His food grown on Alpha costs 3000 to his table

Seem like a winner for Alphans to grow their own food. Saves 900 credits and gets to the table quicker.

I think you reversed "Alpha" and "Delta" in that last paragraph.  If you switch those two words, it does fit the above math and it is a winner for Alphans to grow their own food.

Quote from: estar...
So I am a guy on Alpha. I got money to invest. I am I going to invest in a hydroponic farm and make a palty 4,200 credits when for the same acrage I can get 20,000 credits per month....


Look a your formula. It lacks scaling as a factor. ... Shipping is not a factor of tonnage. It is scaled in that the larger the quantity you ship the less your costs will be per ton.

Again, a blanket statement that interstellar bulk trading can't happen is not true. That statement have to follow from the premises. .

Regarding investment, margins, and scaling, you've convinced me.  Regarding how discussions have to be careful about their starting premises, I've always agreed with that.

BTW, Xanther makes a good point about the strategic importance of self-reliance in food.  If the government is strong, smart, and loyal to its people, it will want to have at least some chance of surviving a blockade.
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