Capital in board games

In economic strategy board games, it’s very common to have an arc of growth over the course of the game. You start out with few resources, and then you invest those resources to bolster your income, which then gets reinvested to grow even more, following an exponential trajectory. Central to this growth trajectory is the concept of capital.

In economics, capital is understood as durable goods that are used to increase or enable production. The classic example of capital is factory machines, but capital could also be something abstract, such as an education. People commonly understand capital as simply money, which is true insofar as money is commonly invested into capital. And so it is in economic board games, where you invest fictional money into fictional capital in order to increase fictional production.

The Strategy of Capital

I have to use a specific board game as an example, although I realize that most readers would not be familiar with any example I choose. I’ll use Terraforming Mars, a relatively straightforward example. Terraforming Mars is what board gamers call an “engine-building” game, but if we translated to the language of economics/finance, we would probably call it a “capital-building” game.

Terraforming Mars is structured as a series of rounds where you earn income, and make purchasing decisions. You look at a series of cards, most cards presenting an investment opportunity that further increases your income. In essence, it’s a game about shopping for different kinds of capital.

Different kinds of investments have different interest rates. For example, if you invest in money income, it costs about 5M to increase your income by 1M (M stands for megacredits, a sci-fi currency). That’s an interest rate of 20% per round. Therefore, if you only ever use this kind of investment, you will grow exponentially by 20% per round.

You can also leave money uninvested, to be used in a later round. In board game lingo, we’d call this “floating” the resource. The problem with floating is that you’re effectively paying an opportunity cost of 1M per round for every 5M floated. That said, floating could be the correct strategy if the current investment options aren’t good or aren’t available, and you’re hoping for better opportunities later.

Other investments may have higher or lower interest rates, with various tradeoffs. For example, it costs around 10M to increase your income by one titanium. One titanium is worth 3M, so this is a 30% interest rate. However, titanium can only be spent on certain kinds of cards. Effectively, you’re trading flexibility for a higher interest rate.

It’s very difficult to measure the value of flexibility against the value of capital. Who can say what cost you’re paying when you restrict your future actions? Strategy games thrive on this sort of decision, asking the player to evaluate things with no clear quantitative value.

Terraforming Mars also has one very important resource that isn’t a form of capital: victory points. Victory points don’t provide any income, but you win if you have the most victory points at the end of the game. It costs around 5M to get one victory point. So the ideal trajectory is to invest your resources into the capital with the highest interest rates, and then suddenly pivot into dumping all your resources into victory points.

However, this depends on getting the right opportunities at the right time. Many cards will give you income and victory points as a two for one deal, which isn’t very efficient when you want only one or the other. Some cards give you more victory points if you play them early on. In practice, the players gradually pivot from capital to victory points over the course of a game, because it’s very difficult to suddenly convert all your resources into victory points right at the end.

Comparison to Capitalism

By the way, I’m being very deliberate in distinguishing capital from capitalism. “Capitalism” might be defined as a system in which capital is privately owned. Non-capitalist systems still have capital, e.g. Soviets still had factories. When a board game features economic growth, that is an example of capital, but it is not necessarily capitalist.

Terraforming Mars is a game that I would describe as capitalist. Mechanically, players individually own separate pools of capital. Thematically, it’s about a bunch of corporations competing to terraform mars, while vying for the favor of a governmental organization. We jokingly describe it as a crony capitalist utopia. On the other hand, Terraforming Mars lacks some other defining characteristics of capitalism, such as competitive markets. Some board games have competitive markets in the form of bidding, but in Terraforming Mars the prices of cards are just fixed by the game designer.

And then take Spirit Island. Spirit Island also involves (in a limited way) investment and growth. However, thematically the game is about repelling colonists from an island. And mechanically, it’s a cooperative game, so any capital is publicly owned, so to speak. So while the game mechanically has “capital”, I would not describe it as “capitalist” at all.

But let me highlight two more ideas in real-world finance, and comment on their application to board games. In finance, you have the concept of liquidity, the ability to meet short-term obligations. For example, when people withdraw money from a bank, the bank needs sufficient liquidity to produce the money. Some assets are liquid, meaning it’s easy to convert them to money on short notice, while others are illiquid, meaning that you’d probably have to sell them at a discount if you want to sell them quickly. If a bank invests too heavily in illiquid assets, then they may lose money if they have to sell them off quickly.

In Terraforming Mars the analogue to liquidity is flexibility. For example, titanium is very efficient to produce, but it’s not very liquid—there aren’t always good ways to spend it. Another analogue to liquidity is the player’s ability to quickly convert resources into victory points towards the end of the game.

Another concept in finance is that of risk. Risk is basically the variance in outcome. All other things being equal, risk is bad for investors.  So there’s less demand for riskier investment opportunities, which means those investments are marginally cheaper (i.e. they pay higher interest rates). The most challenging aspect of investment is managing risk. A good investment portfolio will have assets that match the risk tolerance of the investor–while also avoiding unnecessary risks that don’t pay out in any way.

In board games, risk plays quite a different role. After all, the worst that can happen in a board game is that you lose the game. The best that can happen is that you win. Since players aren’t risk averse in the same way that real-world investors are–and since the price of an investment isn’t determined by supply and demand–there isn’t any reason to believe that riskier investments should have higher interest rates. In principle, you want to take whatever level of risk maximizes your chance of winning. So if you’re behind, take risks that may cause you to pull ahead; if you’re ahead, avoid risks that might cause you to fall behind.

What Makes Capital Fun?

In a board game that involves capital, you start out in a weak position, and then become more powerful over time. Let’s imagine a hypothetical board game that does the opposite: you start out strong, and become weaker over time. On the surface, you’re getting the same mix of experiences–at some point you’re weak, and at some point you’re powerful. But it really doesn’t sound as fun, and I’ve never heard of a board game which attempts to make it fun. (Tell me about your counterexample in the comments!)

Capital-building games are basically power fantasies. Becoming powerful over time is the fantasy. Becoming less powerful over time is the anti-fantasy. Staying the same power level over the course of the game, and it’s like you’re never powerful.

There’s something to be said about how a good board game should tell a story. There should be setup, rising tension, climax, and denouement. Generally, you want to build tension over the course of the game, and don’t make it clear who’s winning until the end.

A tried and true method to tell a board game story, is what we call the “build up cash out” structure. Early on, the goal is to build up capital and resources—that’s the setup and rising tension. Later, the goal is to efficiently convert those resources into victory points—that’s the climax. It’s not clear who will win until the end, because the value of capital is obscured until players convert to VP. The denouement is when players count out their points and talk about the experience.

One common problem in capital-based board games, is the “runaway winner” problem. Because of the exponential growth, any early gap between the players may grow until it becomes an insurmountable lead. Experienced players may recognize this, and knowing the likely winner from an early stage undercuts the game’s narrative arc. It is fair to say that Terraforming Mars has a bit of this problem as well.

In finance, obviously telling a story isn’t particularly a priority. There’s no real beginning, middle, and end. And uh, the runaway winner problem is a bit graver in its consequences.


  1. says

    I’m not familiar with Last Will, but at least on the surface it looks like it has a build up cash out structure. The goal is to spend all your money, and one way to do that is by buying properties and spending money on maintenance. So the property is mechanically like capital, although narratively it is not. Of course, you need to sell the property at the end, and that sounds a bit unusual.

    I was thinking about it, and one example might be war games with a fixed number of units. Like Warhammer, or maybe Chess? As the battle goes on, players lose units, which decreases their power over time. Although, a game like this could have even more of a runaway winner problem. I think Warhammer triggers an end game condition before either player feels like they’ve lost most of their power.

  2. suttkus says

    There’s also Giveaway Chess. It plays like regular chess, except:

    * If you can make a capture, you are obliged to do so.
    * The winner is the first person with no pieces.
    * There is no castling and the King has no special status (no checks, no checkmate).

  3. says

    I forgot City of the Big Shoulders, where even as your personal capital increases (you can run more sections of your factory and automate to make running them cheaper) the marketplace where you sell those goods declines, and you sell more and more of them at half-cost.

  4. says

    @One Brow,
    That sounds interesting. So there’s a sort of treadmill progression to it.

    I had mentioned Spirit Island in the OP, but it doesn’t really have exponential growth, it’s more like treadmill progression. The invaders grow as you grow. So either you have to grow faster than them, or win before they outpace you.

  5. flex says

    After some reflection, I think you can probably fairly say that all games involve capital in some manner. What you are really talking about in this post is games which require growth of that capital in order to win.

    If capital is defined as the resources available to be used to win the game, then war games with a fixed number of units have capital. So does a poker hand. In the case of a war game, the capital is deployed in a manner to gain victory points, usually by capturing territory. The capital might be expended, i.e. the units are destroyed, but it is not necessary for them to be destroyed in order to capture the territory. Theoretically the opponent could withdraw from the map, allowing all units to survive.

    However, in cases like this the original capital does not grow. Sometimes subsequent turns, or reaching certain conditions, will allow more capital (troops, resources, pieces) to show up, but in most games capital doesn’t cause growth merely by existing.

    But there are a number of games which attempt to simulate economic activity, where simply holding capital in some form will generate more capital, and the new capital can be spent, or saved to generate more, etc.

    What they appear to be simulating is outside investment, non-player actors outside of the sphere of the game which set value and demand for goods within the game, thus generating more capital for a player.

    For example, in an 18xx game, where a player is running a railroad and also growing the stock of that railroad, and investing in the stock of multiple railroads, the stock market price moves based on payout of dividends. If the railroad pays dividends the stock rises in market value. But why? What drives the value increase if none of the players are buying stock (or if the players already control 100% of the stock)? There is an unwritten assumption that actors outside of the game, non-players, are willing to purchase the stock at the higher price if a player is willing to sell.

    I haven’t played the game you mention in the OP. But I can see the same mechanic at work. What is the economic mechanism for a player to invest 5 MC into generating more income and raising their income/turn by 1MC? It’s a game mechanic, certainly. But what does it represent in an economic sense? It represents an outside agency who will take the money now and return it with interest. In other words, it suggests that the game is operating in a space larger than the board or players. The exact details of that space is undefined, put in X and get X+Y out, but that wider space has to exist otherwise the game mechanic couldn’t happen.

    What is more, as you say, these games allow for exponential growth. That is, regardless of the growth a player has already experienced, that external market can always return the expected growth.

    There are other games which imply an external, non-player, involvement. Monopoly is a classic on. Every time you pass GO you get $200. That $200 comes from somewhere. But it does not have the same growth mechanic. It is a fixed value and doesn’t alter during the game. Similarly, the value of properties increase as they are developed, but those values are fixed. New York Ave with a hotel will always charge $1000 if you land on it. If every player had the option when they passed GO to convert $100 of their cash on hand to $110, without penalty, the game would be very different.

    Which narrows the type of game which could be called a capital-driven game in two ways. First, there is an external agency which affects the game. Second, this external agency generates interest on capital, a percentage return, without additional penalties or changes to the game mechanics.

    I would submit there is one final attribute required to call a game capital-driven. A capital-driven game cannot be won without capital growth. One technique is to make the difficulty of the game change, become harder, as the game progresses so that growth is necessary to even remain in the game (in the 18xx games the older engines become obsolete and newer engines cost more). Another technique is to offer additional resources to players who have reached certain levels of capital growth. But in any case, a player cannot hope to win if the amount of capital available to the player does not grow.

    Which leaves us with three characteristics for a capital-driven game:
    1. A mechanic which interfaces to some agency external to the game/players
    2. This external mechanic provides an unencumbered ROI
    3. The game cannot be won without using this external investment mechanic

    The most unrealistic aspect of these games is attribute 2. Markets do not guarantee a return, and some markets cannot absorb all the resources thrown at it. I seem to recall a game I played many years ago where for a specific investment type the return would drop as more players invested in it, i.e. if players invested $100 in an investment it would pay 10%, but if players invested $200 the return may be only 5%. I also seem to recall a game where an an investment would return X units, divided among the players who invested, with any remainder returned to the bank. Both of these types of mechanics lead to slower growth, but they don’t completely eliminate the possibility of exponential growth.

    In the real world, exponential growth is only possible within limited boundaries. Which is why attribute 2 is not really realistic.

    But it can make for a fun game. Cheers!

  6. says

    Thanks for your thoughts.

    What is the economic mechanism for a player to invest 5 MC into generating more income and raising their income/turn by 1MC?

    In Terraforming Mars, the investments represent several different things. Build a city, earn an income from the taxes. Increase the temperature on Mars, earn income from additional favor from the government. Develop a new technology, earn an income–I presume–from selling it.

    If you’re earning a money income, that money is coming from someone else, an implied NPC, because that’s how money works. However, that isn’t always the case, because not all capital is about producing money! For example, you can build a titanium mine. The titanium doesn’t get exchanged for money, it just gets used directly.

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