Re: Fantasy Economies: How closely should we examine them?
I think economics gets a pretty bad rap from people in general, no one really wants to spend time (especially while gaming) thinking about how markets work and how they're influenced by governments or in the case of a fantasy game, how they are influenced by magic, gobs of gold, and piles of jewels. Dispite the common quote of referring to economics as the "dismal" science, I find it to be intriguing and far reaching and with dynamic consequences even for a fantasy setting. When you boil it all down, economics is really just markets and markets are just two or more people involved in mutually benificial exchanges. Sure, both (or everyone) is trying to get the upper hand in the deal, but both (or more) people want what the other is offering so some deal is likely to be struck and it will likely be to the benifit of both (or more) people.
Plus, I'm not really sure how badly magic can destroy an economy. If food can be created out of thin air, sure farmers, cooks, and the like will need to find skills that will serve their current situation better, but beyond that? It's like when any technology creates efficiencies in a system, it has ripple effects outward (loss of jobs, fewer labor requirements, etc), it also expands the market for that particular product, usually by decreasing the price bringing those who earn less into that products market. I think magic would act in many ways, like advancing technology... which is why I always define my magic systems thoroughly so that I (as GM) can regulate how the fantasy society develops and toward what direction.