Worldbuilding Economics

By designing a detailed economic system in your novel, you can create a consistent and realistic world that pulls your readers in.

What does the production, distribution, and consumption of goods and services have to do with you, a nerdy little writer? Well, if you’re writing speculative fiction, a whole lot. Worldbuilding economics are a foundational piece of building strange worlds and new lands.

We’re going to teach you the foundation of economics and show you how to apply those methods to your current fiction project.

What is Economics?

It’s not physics, an important friend to all science fiction writers, and it’s not magic, the favorite of fantasy lore. It’s a social science that tries to be as scientific as possible while studying and explaining how social forces dictate the world around us. Yes, there are laws, but ones created by flawed humans. It’s not the same as studying the laws of physics. 

In your story, economic worldbuilding might look like how resources are controlled in a closed system like a generation ship. Or, it could be the grassy hills where the town’s sheep used to graze that a dragon has decided to claim ownership of.

 

Sheep grazing on a grassy hill

Space Economy Camp

In addition to being book coaches, we’re writers like you. Rebecca was given the opportunity to attend a Space Economy Camp in November 2023. Led by Joffa ApplegateMary Robinette KowalKim Machariaand James Schalkwyk, the goal of the camp was to empower writers to test and create new systems in space-based writing. 

Fiction has an enormous impact on public thought and when it comes to space exploration, movies and books determine what our future will look like. We don’t want to replicate broken, unsustainable systems. It’s a chance to do something new. A challenge to better ourselves by.

A collage of photos from space economy camp, including a presentation, profile, and statue.

We believe in that mission, so we’re sharing the top takeaways of the conference with you today. And we’ll make your story better along the way as well.

A special thank you for the great lectures from economists Alberto Cottica, Marco Janssen, and Jason Barr.

The Basics of Economics

Why do people—or aliens, or the fae—do what they do?

Well, a designed systems has rules. Mechanisms are the things within a system that encourage people to act a certain way. For instance, an incentive for magical folk to share their skills with the non-magical as a way of keeping peace in a fantasy realm. And, there are consequences when people break rules. Say, a fine for hoarding solar panels on Mars. But these mechanisms can look like anything including elections, rituals, or tax systems.

The setting you’ve built in your story is a manufactured environment. You are the writer, the creator, and are making decisions on every level. However, inconsistencies in an economic system will break a reader’s suspension of belief. We want your systems to feel believable.

Field of solar panels on the desert

Let’s work through an example. Say you want to set your story in a utopia. It’s the perfect place with enough food and zero crime.

But what’s stopping people from breaking the rules? Won’t someone take advantage of the system? Further, small scale utopias are easily invaded. Even in a large one, a single change in the equilibrium can unravel the entire system.

Readers are distrustful of systems that sound too good to be true.

So, you have to make it true. In keeping with our utopia example, you’d need to implement a mechanism that convinces the population to keep it so. Most groups will expel free-riders and won’t tolerate cheaters. That’s one way. But what about when one of those disgruntled free-riders shows up again with a dragon?

Dragons flying toward a castle

It’s okay to have a problem–even a utopia has to have conflict for the story–but make sure it’s story-worthy.

This is all human. That is key. One of the reasons we’ve evolved so much is that we’re really good as a species at managing shared commons, or shared resources and systems. Humans want to live in successful groups and groups become successful through collaboration. If we fail to maintain those commons or one individual extracts too much, whether they’re physical (like collective water resources, forests, or public spaces) or abstract (digital knowledge bases), systems fail.

Keep in mind that what we value is subjective and, largely, people live the way people think they should live. You can poke and prod at your characters with mechanisms to get them to act a certain way, but it’s okay if they break some of the rules of your systems. Afterall, that’s what we do in real life.

A forest with a body of water in the middle

The Details of Worldbuilding Economics

We often fall back on our own systems because we struggle to imagine something new, or we don’t think other systems are practical. It’s tempting, but the most imaginative works look beyond what we see in the real world. Push your worldbuilding forward with these specific thought paths.

Elinor Ostrom shared the Nobel Prize in Economics in 2009 for her analysis of how communities succeed at managing commons resources. Based on her work, she developed 8 principles for how to sustainably-govern shared commons:

1. Define clear group boundaries.

2. Match rules governing use of common goods to local needs and conditions.

3. Ensure that those affected by the rules can participate in modifying the rules.

4. Make sure the rule-making rights of community members are respected by outside authorities.

5. Develop a system, carried out by community members, for monitoring members’ behavior.

6. Use graduated sanctions for rule violators.

7. Provide accessible, low-cost means for dispute resolution.

8. Build responsibility for governing the common resource in nested tiers from the lowest level up to the entire interconnected system.

Statue of blindfolded woman holding scales

We often want a sense of depth in our science fiction and fantasy. It gives readers the idea there’s a history there, and most long-term functional societies will have working systems in place. Use Ostrom’s Design Principles to consider how your characters interact with the systems of that world.

That will help you set up a society that works. Now, consider how else that society will seek to influence the behaviors of its people/characters. Think clearly and originally about your mechanisms. Choose mechanisms that speak to the unique qualities of your world.

Remember the rule breakers. We see dystopias in fiction when these mechanisms are relaxed. We see dictatorships when one person has control over all the mechanisms. We see the creation of a space ballet when one of the main ways to define social status is by attending the ballet on a rocket ship. Get as weird as you want.

A ballet performance on a stage with an orchestra

As your story will take place over time, consider how these economic patterns might shift. They may change seasonally (a society that labors hard in the summer months and rests in the winter), or production might kick up in war times.

Finally, to keep your plot churning, take this fact to heart: any solution will eventually have a consequence. You can design the perfect society with an intriguing economy, but there will always be one sticky character that messes it up.

Need more help with worldbuilding? Check out these storytelling tips from the writers of Mythica.

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