I'm probably going to get rated into oblivion for posting anything about the in-game economy but what the hey.. I've been thinking about this for some time and wondered if anyone wants to wax philosphical with me about something we all take for granted: The AH Price History.
First of all, as far as I'm aware FFXI is unique in giving us a price history at the AH. EQ and EQ2 have no such thing (I play them both) and I've been told it does not exist in WoW either. Clearly 3 MMORPGs does not constitute a majority, but I believe these titles make up the majority of MMORPG players, so humour me.
The Good
The price history of an item on the AH lets us know what kind of money our peers are getting from sales, and let buyers know what they can expect to pay. At the most basic level, buyers will be trying to drive the price down and sellers will be trying to drive the price up. The knowledge we gain from a price history is vital to what we put an item up for, as well as how much farming/crafting/questing/begging we have to do to afford something we need.
In EQ and EQ2 players have to bazaar everything. That means the price is stated, and only items that are on bazaar are listed at any given time. As a buyer I can easily get the lowest price. As a seller I can't hide behind an auction house and have to compete with stated prices. My understanding of WoW's system is limited, but it seems it is much like E-bay. If that is indeed the case, it is just like FFXI only there is no price history, only a statement of the highest bid so far on an item.
The Bad
When no price history is available you need to rely on other people selling an item you want to auction/bazaar in order to gauge the sale price. This means that common items will typically have regular competition in pricing while rare items will not. Imagine if you were to kill Leaping Lizzy and get her boots, then saw no price history on the AH. What would you sell them for? If you had no prior knowledge of the item it might be tough to choose a price. Shrewd players will realize that to have +3AGI/+3DEX at level 7 is unheard of among other pieces of equipment, and so you would sell it for a hefty sum. However, there are those who are not as shrewd and wouldn't dare sell them for more than a few thousand gil (since "Nobody at level 7 has 600K to buy armour" right?).
My point is that the inflation of rare items can be partially attributed to the existence of a price history. Because I know the boots, to use the same example, are worth 300K, but then I see that someone squeezed an extra 10K out of it, I will also sell mine for 310K or higher! Every time a buyer is willing to pay a little bit more to get the item it is recorded in the price history and the next seller will shoot for keeping the price at that new level. Without a price history there will still be a general awareness that leaping boots are worth more than leather highboots - a lot more! - but if I sell mine for 500K and you sell yours for 300K nobody is any the wiser. The price will not jump server-wide to 500K just because I ripped somebody off and you didn't.
The Ugly
I admit wholeheartedly as an artisan in EQ2 I dearly wish there were a price history to help me choose how much to sell items for, as well as what items will sell for a better profit than others. Nevertheless, because of the underlying behaviour of buyers and sellers, having a price history available at the AH makes it easy for prices to rise. My belief is that common items will be unaffected by price histories, but rarer and high-level items are the ones that suffer the most.
Was there inflation in EQ, despite the lack of a price-history? Hell yes! But truthfully it was the common items that were going up in price the fastest, which I believe drove the price of all items up (when the cheap stuff sells for more you need more money from rare/high-level items to keep supplying yourself with common items, right?). I believe the continous rise in price of rarer items, such as leaping boots, emperor's hairpin, brigandine +1, to name a few cases on my server, is more due to the awareness of what Joe sold ItemX to Bob for. If Joe can make 1.2 million gil off said items, so can I!
Anyway, post your thoughts. I only hope this can create some sensible discussion rather than turn into a karma-bomb/flame-war thread.