#mylittlepony - #The Econony of Equestria & its Neighbors

The Econony of Equestria & its Neighbors

Some (hopefully organized) shower thoughts on the economy of Equestria. I may be way off base on some of these, as I don't have time to rewatch the whole series and take notes on the depiction of economic activity in each scene where it happens.

tl;dr: Equestria has a hybrid economy with just price theory of labor and a split between just prices and gilded age free markets for goods

Labor

Most ponies are shown living a comfortable life without major money troubles. There are significantly wealthy businessponies and the Princesses, but the floor of economic status in Equestria is significantly higher than in the human world. Although some spots of Dickensian poverty are shown, they're all as background gags for in-universe stories or as an easily-solved friendship problem that somehow required members of the M6 to show up to solve it.

Since we do not see ponies complaining about pay often nor asking for raises, we could assume that they are being paid something close to the full value of their labor. However, it may be the influence of their cutie marks that is the primary reason why the wage floor is so high. A pony's CM guides them to the forms of work they are most fit for, so the Equestrian economy is (from the perspective of labor) extraordinarily efficient compared to human economics. Underemployment is very rare because ponies have a literal stamp that reminds them where they can make full use of their talent. Also because of CMs signaling out the ideal career paths, there a far higher percentage of self-employed ponies and family businesses in Equestria than in humanity.

Ponies sorting themselves into fitting employment at a far higher rate than humans also brings them back to just price wages. Instead of being paid for what the employers can get away with because humans have a tendency to try work in all kind of jobs they are fundamentally unfit for (but unfit in ways not detectable by interviews and all that garbage), ponies pick jobs where they can contribute their full value from the start of their careers. Instead of carpenter ponies commanding a higher wage than farmhand ponies (for example), they all earn roughly the same daily wages, so there is a reasonable expectation on the income and expenses of most ponies you'd meet (which flattens out pricing because there are fewer price tiers that are reasonable to reach for).

For business owners, there are strong incentives to keep headcount down and do as much as work as possible with existing employees because hiring new ponies often ends up being closer to a (temporary) profit-sharing arrangement than a quick expense to get through the busy season. The Cakes keep Pinkie around as a part-timer because Pinkies' party business often ends up involving a large order of cake; Rarity has Coco and Sassy Saddles to manage her Manehattan and Canterlot branches (which probably move more inventory from foot traffic than the Carousel Boutique, even if Rarity's location leads in shipped orders) (speaking of them, are Sassy & Coco primarily salesmares and seamstresses and the dresses are all "Designed by Rarity in Ponyville" or is it more so that Rarity sets design agenda and franchises out her name but Coco & Sassy design their own dresses fit to their respective markets?). The low headcounts of most businesses prevent labor from being as commodified as in a post-industrial world and also reduce the incentives to unionize (but increase the incentives to form guilds).

Equestria has a much higher percentage of government-employed ponies than the English-speaking world has government-employed humans. Not only are the royal guards, teachers, servants & executive assistants to the princesses, mayors & sheriffs, and the military paid from government funds, but so are the weather teams of pegasi, animal sanctuaries, and other similar duties. Because pegasi are uniquely adept at weather manipulation and flying units of the military require a much larger standing army than ground or magical units, well over half of the cloud-based pegasi receive at salary from the government (even if it's part-time or seasonal work). Even counting ground-based pegasi (whose occupation distribution is closer to that of unicorns & earth ponies), pegasus ponies are disproportionately emloyed by governments.

Finally, it would be negligent of me not to mention the many "from each according to their abilities" civic duties that Equestria has (Runnings of Leaves, Winters Wrapped Up, major lake-to-cloud water transfers, etc…) that don't have any equivalent in the human world.

Goods & Services

Although the princes of most items are rarely (if ever) mentioned unless it's to show that the Flimflam Bros are ripping everypony off, the gut feeling the show's universe gives me is that most goods (bakeries, florists, Pinkie Parties, carpenters, etc…) are priced at "just price" rather than some price that responds rapidly to profit maximization calculations. Perhaps this is because the value of the money is kept steady and much of the economy is in-kind bartering rather than cash-trading. However, some classes of goods (Rarity's dresses, whatever the Flimflams are selling, griffon-owned shops, Manehattan, etc…) are priced according to what the market can afford rather than some stable fraction of the estimated daily earnings.

The last observation of Equestria's economy is that housing and real estate are not at all significant factors in most of Equestria. This may be more local to Ponyville, but Equestria has plenty of unused arable land, so prices are kept in check. Additionally, most housing stock we see in the show are either family freeholds (Apple orchard, Pie family rock farm), lifetime leases in government properties (Fluttershy's cottage, Twilight's residence in the Golden Oaks Library, Celestia in Canterlot Castle, etc…), or pegasi who can assemble semi-permanent collections of clouds to build their home (the entirety of Cloudsdale). The one way where rents and real estate make a notable mark on the economy is for commercial rents in places such as Manehattan and Canterlot (or even something as central as the Carousel Boutique—there's no way that was affordable to buy unless it was dilapidated when Rarity moved to Ponyville).

Submitted September 12, 2019 at 04:15PM by PUBLIQclopAccountant
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