Basic graph trend of an item

[The Spycrab Risotto]

1. So new items first have a hype.

2. Then they lower because there is a lot of supply and not much demand

3. They stay a stable price (robohats)

3a. Many people buy the item again and it rises quickly in price (e.g. strange flare gun/ reserve shooter/ 2012 festives)

4. They slightly drop again if it rises (vintage concheror/ vintage kunai/ 2011 festives) EXCLUDING KEYS

What next?

Any opinions?

[Jymotion]

Let's not just throw the word "demand" around.  I've seen too many suggestions for 5+ key items say that there is "no demand".

 

There is a difference between Demand and Quantity Demanded.  For example, would I like to buy a Rolls Royce car?  Absolutely, they're beautiful.  Am I willing/able to pay $250,000 for a car?  Aboslutely not.  This difference (dependant on the price) is the difference between Demand and Quantity Demanded.

 

So let's clarify this "hype"

1. New item is introduced.  Everyone sees a picture of the item and decides it is pretty cool.  The first dozen copies of the item are found and put on the market.  Right now, the Demand is comprised of everyone who thinks the item is cool.  90% of them are willing to pay 1.33 ref for it, 30% are willing to pay 2 ref, 10% 3 ref, 1% 1 key.  That means, the Quantity of the item Demanded at a selling price of 1 key is 1% of the people who think it is cool.  The lucky people who got the first copies of the item are able to sell it to that 1% for 1 key.
2. That 1% of traders that were willing to pay 1 key for the item have no gotten their items.  They only need one and so they are now no longer in the Demand for that item.  However, there are still several traders (10% of them) that are willing to pay 3 ref.  Pretty big drop from 1 key to 3 ref, but it is not because the item is no longer demanded, but because the Quantity Supplied (sellers) is larger than the Quantity Demanded and 1 key.  Sellers know that more and more copies of the item are entering the game and they better sell quick.  The buyers know the price will drop, but are still willing to pay 3 ref to have the item right away.
3. (Craft Hats)  Sales occur at each of the tiers (1.33, 2.00, 3.00, 1 key), until the amount of sellers willing to sell at that price (Quantity Supplied) is larger than the number of buyers willing to buy at that price (Quantity Demanded).  Copies of the item continue to enter the game (increasing supply, BUT CONSTANT DEMAND [edit: it could be said that the demand has decreased as people who have already bought one leave the market]) and the price drops to a price of 1.22-1.33 ref, thanks to the crafting recipe.
   (Other items)  Eventually the price plateaus at the equilibrium price, where Quantity Supplied = Quantity Demanded.  This price could be 0.33 refined for bad stranges or 4 refined for cool miscs.
4. (Possibility)  Time passes and people come to realize that this price that everyone got comfortable buying and selling for isn't actually the equilibrium.  Sure, a couple refined sounded fair for a Strange Grenade Launcher (it's just a strange stock weapon), but they were released a while ago and not many have entered the economy since.  Sellers begin asking a bit more and succeed.  Speculators see the slight rise in what used to be a stable price and begin buying them up.  Popular opinion of the item is that it is on the rise and so DEMAND INCREASES.  Price continues to rise until the Quantity Demanded is met, or until popular opinion turns the other way ("I'm not going to spend 4 keys on a strange if it is just going to get re-introduced in the next update).

What causes a change in demand?  Item now paintable (increase), Item can now have strange parts (increase), Item is used in a new crafting recipe (increase), A clipping glitch is fixed (increase), Somebody really cool says that it is lame (decrease).

 

What causes a change in quantity demanded?  Price.

[Baloo]

@Jymotion

 

Thank god another person understands this. I feel like it was rather obvious even before I took IB Econ SL last year that there's a difference between shifts in demand and shifts in quantity demanded. Not to mention that there's no such thing as no demand, but there is such a thing as no demand at X price.

[Jymotion]

Thank god another person understands this. I feel like it was rather obvious even before I took IB Econ SL last year that there's a difference between shifts in demand and shifts in quantity demanded. Not to mention that there's no such thing as no demand, but there is such a thing as no demand at X price.

 

That being said, it is easy to understand that some people use the word casually without intending to get technical.  So, I apologize if that's what Risotto was doing.  That rant was the product of several past suggestions.

[The Spycrab Risotto]

Let's not just throw the word "demand" around. I've seen too many suggestions for 5+ key items say that there is "no demand".

 

There is a difference between Demand and Quantity Demanded. For example, would I like to buy a Rolls Royce car? Absolutely, they're beautiful. Am I willing/able to pay $250,000 for a car? Aboslutely not. This difference (dependant on the price) is the difference between Demand and Quantity Demanded.

 

So let's clarify this "hype"

• New item is introduced. Everyone sees a picture of the item and decides it is pretty cool. The first dozen copies of the item are found and put on the market. Right now, the Demand is comprised of everyone who thinks the item is cool. 90% of them are willing to pay 1.33 ref for it, 30% are willing to pay 2 ref, 10% 3 ref, 1% 1 key. That means, the Quantity of the item Demanded at a selling price of 1 key is 1% of the people who think it is cool. The lucky people who got the first copies of the item are able to sell it to that 1% for 1 key.
• That 1% of traders that were willing to pay 1 key for the item have no gotten their items. They only need one and so they are now no longer in the Demand for that item. However, there are still several traders (10% of them) that are willing to pay 3 ref. Pretty big drop from 1 key to 3 ref, but it is not because the item is no longer demanded, but because the Quantity Supplied (sellers) is larger than the Quantity Demanded and 1 key. Sellers know that more and more copies of the item are entering the game and they better sell quick. The buyers know the price will drop, but are still willing to pay 3 ref to have the item right away.
• (Craft Hats) Sales occur at each of the tiers (1.33, 2.00, 3.00, 1 key), until the amount of sellers willing to sell at that price (Quantity Supplied) is larger than the number of buyers willing to buy at that price (Quantity Demanded). Copies of the item continue to enter the game (increasing supply, BUT CONSTANT DEMAND) and the price drops to a price of 1.22-1.33 ref, thanks to the crafting recipe.

  (Other items) Eventually the price plateaus at the equilibrium price, where Quantity Supplied = Quantity Demanded. This price could be 0.33 refined for bad stranges or 4 refined for cool miscs.

• (Possibility) Time passes and people come to realize that this price that everyone got comfortable buying and selling for isn't actually the equilibrium. Sure, a couple refined sounded fair for a Strange Grenade Launcher (it's just a strange stock weapon), but they were released a while ago and not many have entered the economy since. Sellers begin asking a bit more and succeed. Speculators see the slight rise in what used to be a stable price and begin buying them up. Popular opinion of the item is that it is on the rise and so DEMAND INCREASES. Price continues to rise until the Quantity Demanded is met, or until popular opinion turns the other way ("I'm not going to spend 4 keys on a strange if it is just going to get re-introduced in the next update).

What causes a change in demand? Item now paintable (increase), Item can now have strange parts (increase), Item is used in a new crafting recipe (increase), A clipping glitch is fixed (increase), Somebody really cool says that it is lame (decrease).

 

What causes a change in quantity demanded? Price.

Wow! Clarifies everything. Learnt something new today. Thx Jymotion.

[The Spycrab Risotto]

That being said, it is easy to understand that some people use the word casually without intending to get technical. So, I apologize if that's what Risotto was doing. That rant was the product of several past suggestions.

I get it now.