Magic Item Economy
Vickrey Auctions Abound
I’ve checked extensively for sane prices for magic items in old-school TTRPGs. We have the Encyclopedia Magica, which is an impressive collection, but many of the prices feel out-of-touch.
Detour: Why Have Magic Item Markets
I’ve seen a lot [1][2][3] of discussion on the internet that suggests to solve the problem by not allowing magic item trade. I think this is absurd! The implied setting of every version of D&D that I’m aware of includes the existence of other adventuring parties.
The supply exists. It is easy to imagine that those adventuring parties are finding magic items just like the PCs, and that sometimes they’re not thrilled by what they find, just like the PCs.
The demand exists. The players have excess cash; other adventuring parties have excess cash. Nobles with precious second sons want to send them off for war and glory with the best gear they can afford.
It’s already supported. The 1e DMG has sale prices for hundreds of magic items! OSE (I’m not sure about the original BX text) doesn’t mention not selling magic items.
It’s part of tactical infinity. We want our players to be able to attempt any tactic to solve a problem. Sometimes problems look like not having enough money, and it stands to reason that one of those tactics might be… selling a magic item. It feels really silly to tell a player that they can’t get a room in the inn in exchange for a decanter of endless water, or that they can’t buy 100 flasks of oil for boots of levitation.
Back on Track
If the price of a magic item is too high, players will never buy it, and will almost always sell it (often the case with consumables). If the price is too low, players will always buy it, and only sell it once it’s outdated (often the case with workhorse items like +1 weapons and armor). When the price is just right, they should be torn between buying the item or keeping the money (a real choice).
In real life, we have markets and the subjective theory of value to save us. There are a lot of different mechanisms to perform price discovery (order books, auctions, etc) that are more or less effective depending on the available liquidity.
In D&D style games, we have only one party - the players. What we need is more interested parties; that way sellers can compete to offer lower prices and buyers can compete to offer higher ones (and they can meet in the middle).
Vickrey Auctions
A vickrey auction works best when selling single indivisible goods (like a magic item). Buyers submit sealed (secret) bids to the seller. Once all of the bids are in, the seller awards the item to the bidder who bid the most, but they pay the price of the bidder who paid second most. Bids are binding.
Example: Alice wants to sell her +1 sword. Bob secretly bids 100g. Carol secretly bids 300g. David secretly bids 1000g. David wins the auction and must pay Alice 300g (the second highest bid).
To create more interested parties, we create actual other adventuring parties and give them generated items and funds. Different systems have different rules for generating NPC adventuring parties. Rules are often included for creating higher level characters, and those rules often include a wealth and magic item budget.
OSE’s rules are easy - we can generate expert adventuring parties. Here’s a sample:
Dwarf 9, Paladin 8, MU 4, Ranger 6, MU 7, Paladin 9, MU 8
Short sword +1 (Dragon Slayer)
Chainmail +2
Spell scrolls
call lightning
Incense of Obsession
Book of Foul Corruption
This informs both what they have, and also what they want. There’s a Dwarf, two Paladins, and a Ranger, but they only have one magic weapon and one magic armor between them. They might be willing to give up their potion of invis because they already have a ring of invis, etc.
We need a way to generate their funds. Some games, like pathfinder, provides wealth-by-level charts to facilitate creating higher level characters. ACKS suggests that characters with 20k xp begin with 16k gold (and then use that to buy chances to have magic items).
For OSE, we can infer that their available funds is a percentage of how much XP they’ve earned. The book advises that ~3/4ths of XP earned comes from looting treasure. With supplies and living expenses, I think a fair ball-park range is that they have 1/10th of their XP earned to spend at the market. For this particular party, that is:
Dwarf 9 (27000g)
Paladin 8 (17500)
MU 4 (1000g)
Ranger 6 (4000g)
MU 7 (8000g)
Paladin 9 (27000g)
MU 8 (15000g)
Total: 99500g
Then, we do this 10ish times to generate 10 adventuring parties (bonus: these parties can make further cameos or be rivals).
Then, we declare a day of the week (or month) to be Market Day. If the players go to the market, elect one player to represent the party’s interests. Shuffle the sheets that represent the other adventuring parties and deal each other player (including the GM) an adventuring party. They’re to represent that party’s interests to the best of their ability.
Then go around in a circle and perform Vickrey Auctions for each item that a party doesn’t want. This gives us (an approximation of) fair prices!