Victoria 2 is quite a complex game; players who have played hundreds of hours often find themselves still asking fundamental questions.
In this article, we will be breaking down the core aspects of any Victoria 2’s economy, as well as discussing supply and demand, state capitalism, income, tariffs, how to build factories, products, industry, and more.
What Is The Economy In Victoria 2?
Victoria 2’s economy mechanics are pretty unique — money itself isn’t really a resourse, more like a tool used for exchange. The goal of any economy is to make goods and sell them on the market.
A perfect example of this is in military spending. When you spend money to subsidize your army, those funds aren’t just disappearing. Rather, they are going to the nations that you trade with for those military resources.
Let’s say, for example, France was spending 160 dollars on their military, and getting ALL their military supplies from the Netherlands. In that case, the Netherlands would be gaining a substantial portion of that 160 dollars, for selling their goods to France.
How Production Affects the Economy in Victoria 2
Each province within Victoria have an RGO, which stands for:
- Resource Gathering Operation
What RGO does is tell the player how much of a certain resource is produced in any given state. This can be affected by multiple factors, such as:
- The number of Laborers.
- The number of Farmers.
- The number of Aristocrats.
Once a good — such as iron, or coal — is produced, it is first sold domestically, within the nation in which it was created. Any leftover resources will be sold to the nations within your sphere of influence. And if there are any leftover goods after they have been sold to your nation, and the nations in your influence, the goods are sold on the world market. If they still aren’t purchased, they are destroyed.
The profit from these trades are divided between the:
- Farmers/Laborers.
- Aristocrats.
And through this, you are able to place taxes on these pops, thus making money.
How to Produce Advanced Goods in Victoria 2
Within Victoria, there are 2 primary methods of making advanced goods. Here what they are, and how they work:
- Artisans: Each Pop will individually decide on what product they produce. Using their money, they will purchase the various different components of the product, and then produce it. Depending on different factors within the world market, and the prices of the product, the Artisan will either make money or lose it. In the case they lose their investment, they will most likely get demoted to a lower pop class.
- Factories: A more efficient method of producing advanced goods, each individual factory is only able to create one type of good — that being coal, iron, or any other resource. The factory then purchases the different components needed for making the good automatically. Depending on the number of craftsmen the factory employs, the number of goods the factory will produce. Factories can be expanded to allow more craftsmen to work in them, thus boosting production. Early game, factories aren’t too useful, due to technology. But, about the middle of the game, factories begin to become extremely powerful.
Note: Place factories in states that naturally have the same product as it is producing, this will give your factories a +25% boost.
Technologies To Pick To Boost Your Economy
Throughout the game, technology has the ability to give your country many different boosts. Some of which, can affect your economy. These are located in two tabs — the ‘Financial Institutions’ tab, and the ‘Monetary Systems’ tab. Let’s begin with the commerce tab.
Financial Institutions
The commerce tab includes a range of different technologies, such as the ‘Financial Institutions’. Overall, this line improves your tax efficiency — and this is really good for a few reasons.
When you collect taxes from your pops, the % symbol isn’t how much of their income you are collecting — rather, it is how much of your tax efficiencies income you are collecting.
For example, if you have placed 100% taxes on the Poor, you aren’t taking 100% of their wage. You are actaully taking 100% of your tax efficiency, which can range from 5% – 50%.
How To Find Your Tax Efficiency
Viewing your tax efficiency is very simple, just follow these steps:
- Click the ‘Budget’ button, located at the top of your screen.
- Under ‘Daily Income’ (refer to the image below), hover over the slider adjacent to the pops.
- Here, you should be able to see your Tax Efficiency from the drop-down menu that appears.
Monetary Systems
Other than ‘Financial Institutions’, you will want to prioritize ‘Monetary Systems’. These technology groups will give the player administrative efficiency — which is extremely useful if you are looking to boost your economic power.
What Does Administrative Efficiency Do?
The primary motivator behind increasing administrative efficiency is its effects on tariffs — If you are unaware, or would like to know what a tariff is in Victoria II, click here to check out our simple guide, where we give an explanation on how Tariffs work. Furthermore, administrative efficiency lowers the effect negative modifiers have on your states.
Taxes Explained
To build a stable and profitable economy, you will have to tax your pops, along with the goods that are imported into your country. After all, this is how you create money. Like we have mentioned, there are two primary ways you can generate income through taxes:
- Taxing Your Pops.
- Tariffs.
We have already discussed taxing your pops in the administrative efficiency section of this article (click here to learn more), so let’s talk about tariffs:
Within Victoria II, items produced (whether through factories or laborers) are always sold domestically first — that means, within your country. If you are unable to produce a type of resource, you can import it from other countries, and this is where tariffs come in. A tariff is a type of tax that you can levy on imports, thus gaining you money.
TIP: If your nation is not at war, you can lower your land and navy spending in the ‘budget’ screen. We highly suggest you do this, as these costs are expensive.
People Also Ask
Follow these steps to grow your industry:
– Pick the ‘Clergy’ as your national focus in states, this will improve literacy. This is important, as higher literacy rates mean you pops will promote quicker (we suggest 2% – 4% of all pops be clergy).
– Only build factories in states that make the same good. This is because you will gain a +25% modifier boost to the factory.
– Don’t rely on imported goods.
– Always fund your capitalists industrial projects. Navigate to the ‘Production’ tab, then click ‘Projects’. Click on a project, then click ‘Max’.
– If you currently subsidize your factories, stop. Do this by going to the ‘Production’ tab, then in the bottom right corner of the factory box, there should be a button to stop subsidizing the factory.
– Expand your infrastructure by building railroads in every province — this will increase your production.
– Get Administrative Efficiency to 100% — this will mean more of your pops will become craftsmen.
In Vic 2, there are 2 ways to build factories, which depend on your government type. If your nation’s government type is state capitalism or planned economy, follow these steps:
1. Click on the ‘Production’ tab, located in the top left corner — a new screen should appear.
2. A row for each one of your states should appear, and to the right should be a large button, click it.
3. Pick the factory you want to build.
4. Wait some time, and the factory should build itself.
If your government type is something else, follow these steps:
1. Click on the ‘Production’ tab, located in the top left corner — a new screen should appear.
2. Click ‘Projects’ — here, you should see a list of all your nation’s projects (such as railroads). If you can’t see any, it means that your country isn’t building any infrastructure. If so, lower the taxes on the rich, and this should encourage them to build more factories.
3. Once you see a factory being built, click on it and fund it, by clicking the ‘Max’ button.
There are many available options to choose from when deciding what factory you are going to build in Vic 2. To check which one you should build, click the ‘Trade’ tab at the top of your screen. Here, you can check which items are in high demand. We suggest you build factories for these goods.
Also, we recommend you only build factories in the middle portion of the game, as this is when they are most efficient, and useful.
Summary
To summarise, within this article, we taught you how what the economy is, how it works, and various tips and tricks in Vic 2. Plus, we gave you our suggested technologies you should choose if you want to build up a strong economy.
