Galactic Empire Economics

[Samored]

What type of currency is used in the Empire/Republic? Does each individual planet have its own currency or is there a single Galactic script? What would the banking system look like? Is there a single central bank, multiple regional banks, or a multi-charter system like in the US? Did the Empire differ from the Republic in its financial institutions?

[Boyish-Tigerlilly]

Although I am not familiar with the intricacies of intraplanetary economics, I think the Empire does use something called a Credit, similar to that which was used by the Republic. There might be some local customs of barter or currency exchange. I am not sure on that.

[Quadlok]

Each major government issues its own credit (Imperial, Republic), the Hutts and the Corporate sector also issue their own currency. There are at least two major banks, the Bank of the Core, and whatever the bank on Muunilinst is called. There are almost certainly many others, like the Tatooine Community Credit Union or something like that.

[Hawkwings]

Old Republic, Empire, and New Republic all used "credits".

[Civil War Man]

Each major government issues its own credit (Imperial, Republic), the Hutts and the Corporate sector also issue their own currency. There are at least two major banks, the Bank of the Core, and whatever the bank on Muunilinst is called. There are almost certainly many others, like the Tatooine Community Credit Union or something like that.

And though it wasn't named, there is an interplanetary currency exchange which determines the exchange rates of the different incarnations of credits. Though the Empire and the New Republic do not have an official exchange rate, since neither government recognizes the legitimacy of the other. So such exchanges are only performed in the fringe community (Dark Force Rising).

[Publius]

This subject is addressed in The Star Wars Roleplaying Game, Second Edition, as follows:

Credits is the standard phrase for money, although depending upon a person's reference point, they may be referring to a completely different currency.

During the rule of the Empire, standard Imperial credits were the only universally accepted currency in the Known Galaxy, and because they were backed by the entire galactic economy, and the Empire was perceived to be exceptionally stable, the currency was considered of value almost anywhere, even outside the boundaries of the Empire. Imperial credits came in coins and chits of varying denominations: .1, .2, .5, 1, 2, 5, 10, 20, 50, 100, 200, 500, 1,000, 2,000, and 5,000 credit coins were very common throughout the galaxy; larger denomination coins existed, but they weren't widely circulated.

The subject is also discussed in this author's articles "Sic Transit Gloria, Part III: From the Fall of Coruscant to the Battle of Bilbringi" and "A Billion Here, a Billion There...: Bank of the Core." If this author may be permitted the conceit of quoting from himself:

Furthermore, the collapse of the Empire, rise of the New Republic, and proliferation of independent states created instability in currency, a phenomenon last seen during the Separatist crisis preceding the Clone War, as described in "Currency Upheavals Deliver Profits to IBC" (Lucasfilm Ltd., 2002).The Star Wars Roleplaying Game, Second Edition, explains that at the height of the Empire's power, the Imperial credit was universally accepted, "even outside the boundaries of the Empire." However, the collapse of the Imperial State resulted in this Imperial credit going out of circulation, replaced by the New Republic credit and a new Imperial credit (which was used only in Imperial territory and in the so-called Borderland Regions, unaffiliated and independent areas of space between Imperial and Neo-Republican territory); oddly, Geonosis and the Outer Rim Worlds states that the InterGalactic Banking Clan (IBC) on Muunilinst III was guarantor of both currencies and presumably functioned as the central bank for both rival states (even though Muunilinst remained Imperial territory, the Imperial State was unable to act against the IBC without destabilizing its own currency). Furthermore, the relative value of the two currencies fluctuated wildly, a problem exacerbated by the fact that "many planets, local governments and other corporations have their own currencies, which may or may not be accepted depending on where in the galaxy you are," which of course provoked currency speculation, which in turn encouraged lack of faith in money; barter became an increasingly preferred means of exchange. The Dark Empire Sourcebook mentions that in this time period "corporations go bankrupt or make fortunes on a regular basis," that "companies default on their loans and use military force to dissuade creditors," and "the value of the myriad of currencies in the galaxy fluctuates more rapidly than financial market computers can calculate," which, in addition to rampant piracy, made commerce extremely risky. The Star Wars Roleplaying Game, Second Edition, even points out that these "fears of economic instability" and "lack of new incentives to restart the engines of industry" had dragged the galactic economy into depression, leaving even the New Republic "far from wealthy" and needing to "scrounge for supplies and ships."

and

Bank of the Core is said by the Han Solo and the Corporate Sector Sourcebook (West End Games, 1993) to have been "one of the top 100 banks in the Empire," owning (wholly or by majority) over 3,000 different banking corporations throughout the galaxy. Inside the Worlds of Star Wars: Attack of the Clones (DK Publishing, 2003) calls it "one of the galaxy's largest financial institutions" and places its corporate headquarters in the financial district of Galactic City, Coruscant. It was one of the companies which invested in the original Corporate Sector, and was also a member of the Galactic Corporate Policy League (GCPL), a policy consortium with "secret ties to Palpatine and his New Order" dating to his term as Senator for Naboo, and subsequently became a voting sponsor of the Corporate Sector Authority (CSA), a status that cost the Bank not less than 50 quadrillion credits' worth of investment in the CSA, either in capital or real property. This status also entitles the Bank to proportional annual dividends from the CSA, which is known to generate return on investment (ROI) as high as 360% in some years; during those years, the Bank would receive not less than 180 quadrillion credits in dividends, using the arithmetic formula ROI = (V_f - V_i)/V_i, where V_f is the final sum and V_i is the initial investment. Han Solo and the Corporate Sector Sourcebook calls Bank of the Core "the major financial partner in the Authority"; it mints most of the CSA's money, and is said to have "a controlling interest in over three-quarters of the business loans" in the Corporate Sector. Nothing is known of what kind of relationship, if any, exists between Bank of the Core and the InterGalactic Banking Clan (IBC), which minted and backed the Imperial credit and probably functioned as the Empire's central bank; the fact that the IBC conditionally aided the Confederacy of Independent Systems (CIS) during the Clone War suggests that Bank of the Core was not associated with it, as this would seem to contradict its status as a secret corporate ally of then-Supreme Chancellor Palpatine. Notably, Bank of the Core does not appear to have been considered a legitimate target for privateers sponsored by the rebel Alliance to Restore the Republic, despite its close relationship with the CSA and the Imperial State.

Aside from the InterGalactic Banking Clan (IBC) and Bank of the Core, Bank of Aargau is also known to be a major galactic financial institution. Aargau (Zug III) is located on the fringe of the Deep Core, and according to "The Third Law," "the stability of Aargau's currency, the technical superiority of its armed forces and its strict laws governing weapons possession and precious metal exports have made it the major banking center of the galaxy"; the Bank of Aargau is practically synonymous with the planetary government, and hence diplomatic representatives are greeted in the name of "the Bank and the Depositors of Aargau" (this may possibly be the full name of the corporation; cf. "The Governor and Company of the Bank of England" for the Bank of England or "The Governor and Company of Merchants of London Trading into the East Indies" for the British East India Company). Notably, even Darth Vader refrained from overtly violating Aargauun law, out of a desire not to "tread on the Emperor's delicate diplomatic toes." The Bank of Aargau's wholly-owned subsidiary, Bank of Aargau Security Ltd., controls the largest private army in the galaxy during the Imperial era, according to "Aargau: For All Your Banking Needs." The planet's political neutrality came into play during the Clone War as well as the Civil War, and although it was a member and "key world" of the IBC during the late Republican era, it remained under Republican rather than Confederate control. It is not known whether or not Bank of Aargau remained a member of the IBC in the Imperial era.

[Old Plympto]

Another bank is the Zygian Banking Concern, as portrayed in GG7: Mos Eisley, though that was only a minor branch at Mos Eisley. Because of the poverty of most of its inhabitants, the bank has become nothing more than a glorified pawn shop.

[Samored]

OK I understand the banking system(s). But coins for currency? Especially large demonination script. That's just plain nonsense. Given the general excellence of glaactic communications a universal credit/debit card makes more sense for a common currency.

[Srynerson]

OK I understand the banking system(s). But coins for currency? Especially large demonination script. That's just plain nonsense. Given the general excellence of glaactic communications a universal credit/debit card makes more sense for a common currency.

According to the WEG books, cash remained in common use because it allows for anonymous transactions. Also, and I am just engaging in pure speculation here, there may be significant cultural resistance on the part of some alien races to dealing in something other than physical currency.

[Samored]

OK I understand the banking system(s). But coins for currency? Especially large demonination script. That's just plain nonsense. Given the general excellence of glaactic communications a universal credit/debit card makes more sense for a common currency.

According to the WEG books, cash remained in common use because it allows for anonymous transactions. Also, and I am just engaging in pure speculation here, there may be significant cultural resistance on the part of some alien races to dealing in something other than physical currency.

I don't buy it. Why would a government intentionally create and maintain a system to facilitate anonymous transactions? What benefit would the government receive? None. Individual planets/systems could maintain a specific script for any one of a host of reasons, but for there to be a single universally accepted currency, there's no reason it should be coinage. WEG just copped out and used gold pieces.

[Admiral Felire]

I don't buy it. Why would a government intentionally create and maintain a system to facilitate anonymous transactions? What benefit would the government receive? None. Individual planets/systems could maintain a specific script for any one of a host of reasons, but for there to be a single universally accepted currency, there's no reason it should be coinage. WEG just copped out and used gold pieces.

When you consider that the Galactic Republic has been in existence for some 25,000 years and for all that time it has been a democracy who can understand why they did what they did. The GR was made up of Senators, senators who were currupt and power hungry. If they decided that it would be better for their bribes and business transactions then they would pass legislation in the Senate allowing them to use physical currency. The Empire would not change it because Darth Sideous used the same hard currency when he was trying to gain the galaxy. Remember, the Republic is made up of Senators who pass laws based on self-interest. And having physical currency is self-interest.

[The Dark]

OK I understand the banking system(s). But coins for currency? Especially large demonination script. That's just plain nonsense. Given the general excellence of glaactic communications a universal credit/debit card makes more sense for a common currency.

According to the WEG books, cash remained in common use because it allows for anonymous transactions. Also, and I am just engaging in pure speculation here, there may be significant cultural resistance on the part of some alien races to dealing in something other than physical currency.

I don't buy it. Why would a government intentionally create and maintain a system to facilitate anonymous transactions? What benefit would the government receive? None.

Greater liquidity of assets and decreased need for government oversight. The greater liquidity would come from people buying things that they would be embarassed to "officially" buy (such as the local respected businessman discovered by a muckraker buying PlayTwi'lek). The decreased need for oversight is because with a single "credit card" style banking system, every transaction on every account, even buying a simple drink, would have to be properly maintained within databanks for accounting purposes. It also adds to the consumer's security to have multiple small-denomination scrips rather than a single card with all their funds, in case of pickpockets or losing the card. It's much more flexible for the consumer, and thus more acceptable on a grand scale.

[Samored]

According to the WEG books, cash remained in common use because it allows for anonymous transactions. Also, and I am just engaging in pure speculation here, there may be significant cultural resistance on the part of some alien races to dealing in something other than physical currency.

I don't buy it. Why would a government intentionally create and maintain a system to facilitate anonymous transactions? What benefit would the government receive? None.

Greater liquidity of assets and decreased need for government oversight. The greater liquidity would come from people buying things that they would be embarassed to "officially" buy (such as the local respected businessman discovered by a muckraker buying PlayTwi'lek). The decreased need for oversight is because with a single "credit card" style banking system, every transaction on every account, even buying a simple drink, would have to be properly maintained within databanks for accounting purposes. It also adds to the consumer's security to have multiple small-denomination scrips rather than a single card with all their funds, in case of pickpockets or losing the card. It's much more flexible for the consumer, and thus more acceptable on a grand scale.

Increased liquidity comes from the ability to convert an asset to cash quickly with little or no loss of value, not the option to buy porn without being seen by the Weekly World News. Script-based currency is LESS liquid than electronic-based. Script-based currency requires MORE government oversight and overhead since the minting process must be controlled to prevent counterfeiting and theft. There must be a physical distribution network to get the currency into circulation and retire worn out or damaged script. Then there has to be conversion centers to exchange Galactic Credits for "local" script and back, these would have to be liscensed, bonded, and supported by courier to physically transport the tons of coins needed. Consumers security is not enhanced by carrying multiple small demomination scripts. Think about it are you more likely to be robbed if you have a wad of cash in your pocket, that you have to flash EVERY ting you want to buy something, or if you just swipe a card through a reader. The governments would WANT digital currency because it you allow them to track, and tax, the underground economy, thus reducing crime and increasing tax receipts so maintaining databases of sales transactions would pay for itself.

[Samored]

I don't buy it. Why would a government intentionally create and maintain a system to facilitate anonymous transactions? What benefit would the government receive? None. Individual planets/systems could maintain a specific script for any one of a host of reasons, but for there to be a single universally accepted currency, there's no reason it should be coinage. WEG just copped out and used gold pieces.

When you consider that the Galactic Republic has been in existence for some 25,000 years and for all that time it has been a democracy who can understand why they did what they did. The GR was made up of Senators, senators who were currupt and power hungry. If they decided that it would be better for their bribes and business transactions then they would pass legislation in the Senate allowing them to use physical currency. The Empire would not change it because Darth Sideous used the same hard currency when he was trying to gain the galaxy. Remember, the Republic is made up of Senators who pass laws based on self-interest. And having physical currency is self-interest.

So you're saying that a 25,000 year-old government intentionally created a financial system that restricted commerce, imposed burden and hardship on its citizenry, impeded the ability to levy and collect taxes, AND decreased the overall level of liquidity and efficiency of galaxy-wide commerce because some senators were too stupid to figure out another way to get their payola? Try again.

[FTeik]

DFR mentions a large non-cash money-transfer. It was an Imperial Intelligence Operation to discredit Admiral Ackbar.

[Old Plympto]

We also have credit chips and credit sticks, all online banking, so to speak. Although it credits the source as being the WOTC core rulebook, I have this vague memory of reading about them in a very early WEG book about Bespin, either Galaxy Guide 2 or Crisis on Cloud City, back in the early 90s.

[Cykeisme]

Do those credit sticks and credit chips access account information that is stored remotely, or do they actually keep track of the cash total on the device itself?

It it's the former, what method of communication does it use to contact the bank(s) or other financial institution? If it's the latter, shouldn't it be possible to tamper with the amount stored (counterfeiting, in effect)?

[Duckie]

If it's the latter, shouldn't it be possible to tamper with the amount stored (counterfeiting, in effect)?

I believe the WotC manual says you can either edit the amounts of credits in your account or hook your chip up to someone else's account if you hack it just right, but it is hellishly difficult (DC 35 or 40-ish). It'd probably be easier to go earn as much money as you need than to learn the skills nescessary to hack a credit chip. If the chip senses tampering, it wipes itself, IIRC. Not to mention if you start having outlandish amounts of money in a culture where some of it is electronically tracked people would probably think you're involved in illegal activities (partially correct).

In game terms, You could probably do it with confidence of not getting caught a Level 13-15 character if you focused exclusively on it, but by then you'd be what Yoda is to Jedi in hacking.

[Samored]

Do those credit sticks and credit chips access account information that is stored remotely, or do they actually keep track of the cash total on the device itself?

It it's the former, what method of communication does it use to contact the bank(s) or other financial institution? If it's the latter, shouldn't it be possible to tamper with the amount stored (counterfeiting, in effect)?

There is plentiful evidence of long range message traffic, from as far as the Rim Territories to the galactic core. Burst account transmissions should be no problem. The chip could opperate like today's ATMs with a pre-set no authorization amount and periodic batch updates such as when even a purchase is made. If the account information is stored with robust enough encryption and hashing it would make the chance of counterfeiting minimal and less expensive than policing for physical counterfeits.