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  • I've combined my two passions: economics and Game of Thrones to come up with an economic

  • analysis of Westeros. I scoured the pages of the first 5 books to find clues about

  • the financial situation in the seven kingdoms. Here's what I found...

  • First of all: The Iron Throne really needs to get its finances in order. The crown has

  • been spending and accumulating debt. Unfortunately, none of this spending has been invested in

  • long-term growth. The throne spends on lavish parties and jousting competitions. And has

  • ongoing expenses due to the war of the five kings. In book one Ned Stark says the mad king left

  • the treasury flowing with gold. And Littlefinger has managed to increase revenue tenfold during

  • his time as Master of CoinYet somehow the crown is over 6 million golden dragons

  • in debt. It owes 3 million dragons to the Lannister house, 2 million to the Iron Bank

  • of Braavos, the most powerful bank in the known world, and another million to the church

  • of the seven. The crown’s sizeable income barely covers the interest on its debt. And

  • Cersei has already suspended payments to the bank and the church. It seems to me the Lannister's

  • are going to need a new motto... Based on the unsustainable debt dynamics of

  • the Iron Throne it seems the probability default is highwhich means the Iron Bank is no

  • doubt getting restless. But if Tommen wants to stay on the throne

  • or rather if Cersei plans to keep him there he going to have to keep fighting for it,

  • which is going to be expensive. Since more debt isn't an option, the throne has increased taxes.

  • The crown has imposed a tax on the tens of thousands fleeing to King’s Landing. Tywin

  • even levied a tax on the brothels. The other option is printing money. Which

  • is difficult with a commodity-based currency. But there is some speculation, based on a

  • few pointed lines in books 2 and 3, that Littlefinger was printing more coins by diluting the amount

  • of gold in each. Though these statements could be attributed to Little Finger's incredible

  • business acumen. But there are two sides of every dragon

  • coinDebt isn't so bad if the economy is growingBut there isn't any good news here.

  • Government spending can sometimes lead to growth... If the gold is spent on infrastructure,

  • capital investment and public goods. That was not the case. The iron throne went into

  • massive debt throwing parties and fighting a civil war.

  • The Westeros economy is based on agriculture. And has little by way of international trade.

  • The people of Westeros reap what they sow, which has been less and less lately. And ever

  • since "The Mountain" ravaged the riverlands - Farmers have fled, fields have burned, and

  • equipment has been destroyed. And the fertile lands of The Reach has been cut off from King’s


  • most of us are too young to remember the last winter, I think it's safe to say that it

  • will make farming EXTREMELY difficult. So all signs point to financial instability

  • and negative economic growth. We've already seen food prices increase

  • in King's Landing. With winter ahead and expectations of even less supply, food prices

  • will continue to rise. However, expect the price of services to fall,

  • unemployment is high. I suspect that the supply of prostitutes is on the rise. And discretionary

  • spending has evaporated for most of the kingdom. Which means that the price of some companionship

  • will go down. There's only one positive that I can see coming

  • out of this mess. The Lannisters will likely lose much of their wealth and power.

  • The Iron Bank of Braavos is known for getting its due. They aren’t going to simply write

  • off the debt of the Iron Throne. They will step in and support someone else to take over

  • the throne provided the usurper promises to honor the outstanding debt to the Bank. This

  • is doubly bad for the Lannisters. Not only would they lose control of the Iron Throne,

  • but the throne owes the Lannisters millions of golden dragons--a debt which is unlikely

  • to be honored if someone else takes the throne by force.

  • So at least something good will come out of the impending crisis of Westeros: House Lannister

  • will be hit harder than anyone which will make winter a little bit warmer for the rest

  • of us.

I've combined my two passions: economics and Game of Thrones to come up with an economic

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Game of Thrones: Economics of Westeros

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    gotony5614.me97 posted on 2017/04/15
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