Article
Let me first run through how import tax and free trade works in e-sim and then show the difference as to why this rl ideal is not applicable to e-sim economy.
Countries that have low import tax made a mistake of assuming high prices of products in their country is damaging to their economy as consumers faces higher prices of goods without competition from abroad.
The most important thing though is not to judge the absolute level of prices and make assumptions as to what is consider too high or too low a price. The most important thing here is to figure out how import tax affects the general wealth of the economy.
The difference in e-sim economy and real life economy is that in e-sim:
1. All industries are in a perfectly competitive model. Company owners do not have market power due to no barriers to entry. Consquently most company owners make slim profit margins because if there were any excessive profits new companies would come into the market.
2. All industries are the same in every country. Unlike real life, where there are some products.. say Manga films can only be made in Japan, in e-sim all manufacturing industries can be supplied by the home market.
So what is the difference in terms of import tax to the wealth of a country?
Because of reason one, company owners never make more than the total wage bill of the workers. In fact, most company owners should make very slim profit.. the amount should be equivalent to how much the general player find worth the time and effort to run a company.
So,
Company owner profit < Wages of workers
To see how wealth is affected by import tax - follow the money.
With import tax set at 99%, goods sold translate to mainly higher wages of workers and some to home company owners.
Without import tax, prices translate to mainly higher wages for foreign workers and some to foreign company owners.
Without import tax, wealth is transferred out of the economy to foreign companies . As workers are the main beneficiary of goods sold, even if the foreign company owers are home based citizens, wealth is transferred from home citizens to foreign citizens.
With import tax set at 99%, majority of wealth stays in the economy in terms of higher wages by home citizens/workers and if most of the owners are foreign based, it is still beneficial to close off the market since company owners profit < total wage bill of workers.
The key here is to realise that the consumers are also the workers. Any 'high' prices will translate back to the consumers in terms of higher wages and company owners margins should stay the same.
A good example here is to look at UK's economy where the markets are closed off and UK produces some of the cheapest goods in the world. Even without cheap imports coming into the market, UK companies are extremely competitive since there are no barriers to entry.
There should be no reason why foreign company owners can run a company more efficiently than a company run in home country. Since all industries are the same in e-sim and across countries there are absolutely no benefit to free trade.
In rl free trade works because some companies can be more efficiently run in other countries or goods that are exclusively produced by foreign companies can be enjoyed by home consumers.
Import Tax on Population
Another reason as to why import tax should be raised to 99% on all manufacturing goods is because of how it affects population.. one of the key to the health of a nation.
Without import tax, prices of goods are depressed and put downward pressure on wages. Wages is one of the main factor that will affect population flows within e-sim. When import tax are lowered wealth is transferred out of the economy and it will translate to higher wages for foreign workers and lower wages for home workers. This will damage the home country in terms of greater outflow of workers due to lower wages at home and higher wages abroad.
For the reason of population flow and transferred of wealth, import tax on industries on manufacturing and land companies that the country have a high region in should all be set at 99%
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About the game:
USA as a world power? In E-Sim it is possible!
In E-Sim we have a huge, living world, which is a mirror copy of the Earth. Well, maybe not completely mirrored, because the balance of power in this virtual world looks a bit different than in real life. In E-Sim, USA does not have to be a world superpower, It can be efficiently managed as a much smaller country that has entrepreneurial citizens that support it's foundation. Everything depends on the players themselves and how they decide to shape the political map of the game.
Work for the good of your country and see it rise to an empire.
Activities in this game are divided into several modules. First is the economy as a citizen in a country of your choice you must work to earn money, which you will get to spend for example, on food or purchase of weapons which are critical for your progress as a fighter. You will work in either private companies which are owned by players or government companies which are owned by the state. After progressing in the game you will finally get the opportunity to set up your own business and hire other players. If it prospers, we can even change it into a joint-stock company and enter the stock market and get even more money in this way.
In E-Sim, international wars are nothing out of the ordinary.
Become an influential politician.
The second module is a politics. Just like in real life politics in E-Sim are an extremely powerful tool that can be used for your own purposes. From time to time there are elections in the game in which you will not only vote, but also have the ability to run for the head of the party you're in. You can also apply for congress, where once elected you will be given the right to vote on laws proposed by your fellow congress members or your president and propose laws yourself. Voting on laws is important for your country as it can shape the lives of those around you. You can also try to become the head of a given party, and even take part in presidential elections and decide on the shape of the foreign policy of a given state (for example, who to declare war on). Career in politics is obviously not easy and in order to succeed in it, you have to have a good plan and compete for the votes of voters.
You can go bankrupt or become a rich man while playing the stock market.
The international war.
The last and probably the most important module is military. In E-Sim, countries are constantly fighting each other for control over territories which in return grant them access to more valuable raw materials. For this purpose, they form alliances, they fight international wars, but they also have to deal with, for example, uprisings in conquered countries or civil wars, which may explode on their territory. You can also take part in these clashes, although you are also given the opportunity to lead a life as a pacifist who focuses on other activities in the game (for example, running a successful newspaper or selling products).
At the auction you can sell or buy your dream inventory.
E-Sim is a unique browser game. It's creators ensured realistic representation of the mechanisms present in the real world and gave all power to the players who shape the image of the virtual Earth according to their own. So come and join them and help your country achieve its full potential.
Invest, produce and sell - be an entrepreneur in E-Sim.
Take part in numerous events for the E-Sim community.
