There's been some debate about how subsidies work or whether they work at all.

I
haven't played MotW for nearly a year but still had the numbers and data in a t
ext file (I was actually trying to write a full walkthrough at the time but it w
as never finished)
I figured I'd share this with you. They may have changed some things by now, I d
on't know. Last time I played MotW subsidies seemed to have a bug, I will get to
that later.
First off I've never noticed a difference in production increase when I subsidiz
ed an industry that was already producing. So I advise you not to do that. Nor d
oes it increase production if you subsidize a new industry with more than it nee
ds to get started.
To see whether an industry has started producing wait for about two seconds afte
r subsidizing. Suddenly you'll see that you got more options, like the option to
nationalize that industry. Watch the side and you'll see a scroll bar appear. T
his is how you can tell your production has started. To make things clearer I wi
ll give you a little walkthrough.
Start a game as The Republic of the Ivory Coast. Now go to the industry screen o
f grapes. Subsidize grapes with one million. Nothing happens. Now subsidize it w
ith another million. Nothing happens. Now add two million to the subsidy so that
you have a total of four. Look at the screen and you'll see that you get more o
ptions, this means your country is now producing this product. Now all you have
to do is wait for it grow.
But now stop the game and start a new one. Again play as The Republic of the Ivo
ry Coast. Go to the industry screen of grapes. Subsidize it with two million thi
s time. Wait for a second. You'll see that production starts but this time for o
nly two million!
So what's the deal? Well, starting an industry by subsidizing seems to only be a
bout getting a number right. This would have been more obvious if every time you
tried to subsidize something it would have reset to zero. So if you ever played
Republic of the Ivory Coast for a year and each month you added one million to
grapes and nothing happened... now you know why. All you needed was to subsidize
it with two million at once.
I think the subsidizing screen should automatically reset to zero whenever a new
subsidy is attempted. This way I recon you could have some fun "bidding" until
your industry starts. For larger subsidies you might grow impatient until you fi
gure out the correct number so you'd end up bidding too much. Because if you wou
ld subsidize grapes with ten million instead of two you'd get the same productio
n. You can go over the price but not under.
Now let's try something else. In the Ivory Coast game go to the industry screen
of Naval Construction. Subsidize it with five million. Nothing will happen. I ca
n already tell you you will need ten million for naval construction, so subsidiz
e it with ten million. But again nothing will happen. Ok, click subsidize again
and subsidize it with one million. Now subsidize it with ten million. That STILL
won't work. Reset it again to one million and click ok. Now subsidize it with e
leven million. Production will start. But you only needed ten million! Start a n
ew game as Ivory Coast if you don't believe me and immediately try ten million t
hat time.
So I'm guessing it should actually reset to zero automatically but instead it's
bugged, because why is it adding the one million if you try more than once? Well
, another reason could be is that in time the subsidies seem to get more expensi
ve (in my games they did anyway) When subsidizing a month later you usually need

an extra million depending on how expensive it originally was. The more it cost
s the faster the price seemed to rise in my games but obviously I started with s
ubsidizing the cheap industries and worked my way up so the more expensive ones
took longer anyway.
Anyway. Make of that what you will. You can now try subsidizing things yourself
but there's two methods for trying to get the number exactly right. Either you r
eset it to one million yourself each time or you just add the new amount to the
old amount and when you've got it right you reload the game. The second method e
arns you a million and is a little bit faster so I prefer it.
I spent some time trying out subsidies and I made a list of how much the Republi
c of the Ivory Coast needs for each industry they didn't have yet. I've noticed
that these numbers will be the same in other countries, give or take a million,
but I never really tried it out that much. All I really noticed was that Russia
needed one million more for naval construction than Ivory Coast did. And all the
numbers worked the same for Guinea but I never tried lower there.
So here are the numbers. You can try these out in your own games even if you're
not playing as Republic of the Ivory Coast. Like I said many (or all?) countries
seem to require around the same numbers. These are the numbers at the start of
the game, even after a month they may have already gone up (or down, who knows?)
If they don't work for you you can try a million higher. But to maybe save some
money I recommend you try a few million lower first if you have the patience.
ALL THESE PRICES ARE IN EUROS!!
FARMING
Apples - 1 million
Colza - 1 million
Grapes - 2 million
Pork - 8 million
Potatoes - 5 million
Sugar - 1 million
Sugar beet - 1 million
Tea - 1 million
Vegetables - 1 million
Wine - 15 million
You cannot subsidize fishing!
INDUSTRY (EXCLUDING MILITARY)
Aeronautical construction - 3 million
Aluminum - 21 million
Biotechnology - 29 million
Bottled water - 15 million
Household appliances - 35 million
Naval construction - 10 million
Paper - 33 million
Pharmaceutics - 192 million
Robots - 2 million
Steel - 15 million
Tire industry - 2 million
Video games - 15 million
You cannot subsidize bauxite, diamonds, iron, lead, nickel, plastic industry, si
lver, or zinc! These are natural resources. Natural resources that you don't hav
e are the products you should try to get for cheap using contracts at the end of
the year. It will help your industry.
INDUSTRY (MILITARY)
Aircraft carrier - 54 million

Submarine - 11 million
Fighter planes - 9 million
Helicopters - 2 million
Missile launch - 3 million
Other Surface Ships - 5 million
Tanks - 5 million
You cannot subsidize nuclear submarines and satellites (playing as Republic of I
vory Coast)
SERVICES
Advertising - 188 million
Attraction parks - 3 million
Compact discs - 9 million
Fast food - 3 million
Films - 96 million
ENERGY
Fuel - 255 million (playing as Guinea)
You cannot subsidize coal or uranium because they are natural resources. And you
will need to construct buildings for gas, oil and electricity to improve produc
tion there.
If you happen to play as a different country than the Republic of the Ivory Coas
t and you figure out your exact numbers at the start of the game then please pos
t them here. It will save other people time.

Subsidies
Subsidising a company gives them economic aid from the government for the compan
y to invest in things such as employment, expanding their equipment/machinery an
d the such likes. For example, if you're playing as a country that doesn't produ
ce cars, if you subsidize the auto-mobile industry by 100m, that 100m will be la
pped up by a company or companies who have taken up the task to improve that sec
tor for you. They'll use it to open up factories, employ workers, advertise etc
etc and then you'll notice your country is suddenly producing cars.
Subsidising a sector that is already producing will also help, but you won't nee
d to subsidise by as much. Throwing a sector a 10m here and there however will d
efinitely help that sector invest manpower and resources into whatever they spec
ialize in, which means in the long-term more trade, more self-effeciency, and mo
re money for your coffers.
Exemptions
This option allows you to offer companies in that sector tax reductions. It does
n't completely exempt them from tax like many believe, it just means the governm
ent will contribute partly towards their taxes. I'm not sure of the exact % of t
ax it's reduced by as I can't find the numbers anywhere. But what this means is
you'll be receiving less revenue from that sector, but it also means that sector
gets to keep more of its profits which will help it produce and grow whatever i
ts speciality is.
This option is particularly useful for sectors that are on the verge of collapse
(such as agricultural industry or the jewellery industry in the UK)
Example:Exempting the Jewellery industry means it gets to pay less tax so it gets to kee
p more of its profits which in turn means it can buy more gold to turn into jewe
llery which means manufacturers can sell more jewellery to jewellery shops at be

tter prices who in turn sell more jewellery to the public at better prices.
The long term benefits of helping a sector out this way speaks for its self.
Import Duties
This means when a company or a person imports a good from another country, they
have to pay you an import tax on top of what they've already paid for the produc
e. This makes importing goods more expensive so people will stop importing as mu
ch of it; and instead will start buying it locally from their own (your) country
. This'll help boost your sector, but the WTO and other countries don't like imp
ort duties so use it sparingly. No more than 3% per sector, once you start getti
ng the threats from the WTO tone back the import duties from one sector.

Biggest impact on growth:

Company turnover taxes, industry pollution tax and employer contributions taxes
have a an extremely heavy impact on growth.
Sectors will grow slowly or
e companies will just close
ther to a country with more
wth. High company taxes are
point of doing business in
an't buy the materials they

even halt completely if these taxes are high, becaus

up shop and move to a more attractive country, or ra
attractive economic policies favourable to their gro
basically squeezing them out of business, what's the
your country if nobody is making a profit and they c
need to manufacture produce?

High company taxes will also lead to rising unemployment, as to cover the costs
companies will start laying off workers. Of course when companies go out of busi
ness that's a LOT of unemployed people standing in the dole queue, which means a
higher national expenditure via unemployment benefits. Homelessness could also
rise as people lose their homes as they can't afford to pay their mortgages and
rent. Effectively bringing your entire economy to a halt, or even driving it int
o reverse.
Second biggest:
Income Tax is your second biggest contributor (or hinderer) to growth. Lower inc
ome taxes means people get to keep more of their money they take home from work.
If somebody gets paid 800 a month and income tax is set at 20%, that means at the
end of the month that person only takes 640 a month (and that's before national
insurance and other bills are taken into account, he will actually take even les
s than that home).
But that's 160 a month he loses to income tax, and 160 a month he can't spend in t
he shops. Obviously with less money he will buy less so goods will just stay on
the shelves unsold. That means companies won't have to buy new stock from manufa
cturers and in turn manufacturers won't need to create new goods to sell thus sl
owing growth.
Ideally, you want to be slowly lowering income tax by about 0.2-.03% at a time.
No more or your economy will be destroyed. But as you grow, you will actually st
art to gain more revenue from lowering income tax - it just takes time. That's w
hy it's important to do things slowly, overtime, and small increments.
Low income tax to encourage prosperity and growth. High income tax only to slow
down growth deliberately. (ie: to fight inflation)
Third biggest effect on growth:

VAT, to a lesser extent, also impacts growth. If VAT is too high people will suf
fer similarly to above. Goods will just become too expensive, a high VAT won't a
ffect all your sectors like your income tax though, so you can get away with rai
sing VAT to about 20-25%, but be sure to keep an eye on struggling sectors and o
ffer them exemptions, or even raise VAT while lowering income tax by 0.2%. The g
oods will be more expensive, you'll get more VAT from goods in your revenue, but
also it won't be prohibitively expensive as long as people are taking home enou
gh of their income.
MoW is a sim, so it does simulate things like its citizens saving up to buy a ne
w car etc so while VAT will slow growth it won't be detrimental or a huge impact
as long as your overall economy is healthy enough.
Quote:
What's the difference between income tax and VAT?
Income tax is a direct tax on income. If someone earns 12,000 a year and income t
ax is 20%, that means at the end of the year their total salary will be 9,600. (n
ot including national insurance, which is labelled as employee contributions in
MoW).
VAT is Value Added Tax, this is a tax value added on top of the cost of a produc
t. In countries like the UK, VAT is already added in the price of the product, t
he sellers already add the value. When you buy something from a shop, 20% of tha
t cost is VAT. It's the shop owner's responsibility to include VAT.
Example:
In the USA, they add VAT at the till. So you buy a TV for 2000 in the UK, the TV
actually costs 1,600. The other 400 is VAT, but you don't need to worry about it,
it's all included.
In the USA you would see the TV on sale for $2452, but then when you're at the t
ill/checkout, you'd be billed an additional $490 on top (sticking with the 20% e
xample). It's the customer's responsibility to take VAT into account.
I remember going to Canada once and bought some batteries and when they told me
the price at the till I was like "huh? it says 90 cents over there" and he expla
ined he's added VAT on top.
Quote:
And why do communists/socialists prefer high income tax to high VAT and vice ver
sa with the right parties?
People with high earning wages can afford more tax on their income. They aren't
going to go bankrupt or homeless paying 20% of a 200,000 a year salary. Obviously
the more money you earn, the less the number of 20% seems to you.
A low income tax for the working classes, a medium income tax for middle classes
, and a higher income tax for the upper classes is a fair way to even the balanc
e of taxation.
Of course some greedy rich people won't see it this way, but if you look at it l
ogically, somebody earning 12,000 paying 10% income tax will take home 10,000 a ye
ar. That's not a lot of money.
Someone earning 200,000 paying 40% income tax will take home 120,000 a year. Even
with 60% income tax they will still take home 80,000 a year. That's still a lot o
f money. So is it fair that the two should pay the same % of income tax? The ric
h man is still rich and the poor man is still poor. But with income tax you have
the freedom to take the burden off the lower classes shoulders by offering a lo

wer income tax than high income earners.

VAT however is a flat-rate. You can't have different VAT for different people. W
ith a high VAT, the high income earners can afford it, even with a high income t
ax, stick 30% VAT on top of something.. they could still afford it.
Low income earners won't. VAT just makes things prohibitively expensive for them
to buy. So most humanitarian parties/caring ideologies favour higher income tax
es based on salary so the treasury is filled with money but the streets aren't l
ining up with homeless starving children.
Vice Versa:
Capitalist parties/parties that don't particularly care about other people howev
er will favour a flat-rate income tax for all and high VAT instead to fill the t
reasury. Because even with high VAT the higher earners will still be rolling in
money and easily be able to afford anything thrown at them while low income earn
ers will have to start shoplifting to feed their children. But they think this i
s "fairer" that everyone should pay the same and, from their point of view, high
er taxes for higher earners is "punishing them" just for having a good job and i
ts the low incomer earners' own fault for being born into a poor family.
They are deranged people ;)
Quote:
Does property estate tax have any impacts?
It affects the buying and selling of property. A higher estate tax will slow you
r building, construction sector and people will buy less property. Unless you ha
ve plenty of affordable housing with a fair rent allowance a high estate tax cou
ld also grow homelessness but only in extreme circumstances, most people will ju
st favour renting a place instead of buying property. Ideally you want this tax
low as you want to encourage people to buy. Only time to raise this, really, is
if you're desperate for every last penny and/or fighting inflation and need to d
eliberately slow growth.
Quote:
I know the burden of what is considered high taxes depend by country, but what d
oes that mean?
Not sure what you mean by this question, if I understand right if people are com
plaining they feel burdened, it just means your taxes are too high, or a particu
lar group/class of people feel they are taking the burden of taxes on behalf of
others, basically that your tax policies are unfair towards them.
Ideal VAT:
15-20%
Ideal income tax
Low income:
5-10%
Middle income:
15-20%
High income:
30-40%
Ideal company turnover:
15-18%

These are the numbers you want to aim for, but remember this is a 3-5 year plan.
You need to make trade contacts, grow sectors, get your national debt paid off.
Once you have an excess from trade and taxes, then, one by one, you can start l
owering taxes in 0.2-0.03% increments.
Always check inflation every month raise income tax and banking interest rates w
hen inflation starts going up.

In real life, you would be raising interest rates, tightening fiscal policy (cut
ting government spending and/or increasing taxes), or a combination of the two i
n order to bring inflation down. But in the game, the inflation you have is beca
use your economy is growing fast. The only way to bring inflation down is to bri
ng the economic growth rate down. At the turn of the year, the economic growth r
ate will settle to a more normal level. Inflation will then slowly fall back. Le
t this happen. If you're doing contracts, time those that have the greatest econ
omic impact to November or December. You will get the economic growth but inflat
ion will not have enough time to catch up. On January 1st of the next year, ever
ything resets again.

I'll offer a quick tip about troops stationed overseas - it is possible to withd
raw all of them in one go and bring them back within a month. Others on this for
um would not recommend this approach because of the way it could seriously dampe
n relations with the military. In RoN, there were several countries where Americ
a still had troops stationed.
The starting point for you should be bringing popularity up to a firm 100 per ce
nt. When at that point, it will take something major to erode it. I can tell you
how you can get to this level within a few game days.
There are two ways to run the economy - the "natural growth" route and the "cont
racts" route.
The "natural growth" route means creating growth without contracts. Changing tax
es, building oil platforms/wells and investing in infrastructure are the most co
mmon ways of doing this. This route to growth makes the game much more challengi
ng, and if to be used exclusively, should only be done by players who are intent
on a long game.
The "contracts" route is a system of explicit trading with any of the other coun
tries in the game but with contracts signed on an item-by-item basis. You use th
ese to buy items cheaper than your average purchasing price and sell above your
average selling price, both of which are indicated in the contracts book. Goods
not traded through contracts are automatically purchased/sold on. So contracts r
epresent your way of intervening to maximise profit or cut costs. This route to
growth is what players intent on a short to medium-length game should be going f
or, particularly if the chosen country has a high deficit and/or high national d
ebt. The "contracts" route can be used to engineer ridiciously high levels of gr
owth in some cases.
How to use contracts:

1) Look at the world charts and the contract book for each industry/agricultural
sector as a guide. The contract book is more accurate. Never press "send" in th
e contract book. Instead, invite the leader of the country you want to trade wit
h to your country. You can keep him/her there for as long as you like because ga
me time is paused. You can get deals for several different goods traded in this
one visit.
2) It's a haggling process until an agreed price is reached. Sometimes, the othe
r leader will give up and a message will come up saying "too many negotiations".
You can try as many times as you like to strike a deal. Countries that like you
(indicated by the green smiley face) generally give better deals but it's not a
n absolute rule.
3) Check the
then go back
At the same
unemployment

GDP growth rate in the "Finance" screen before a deal is made. And
and check a few days later to see how the contract has affected it.
time as the effects show up on growth, the public finances and the
rate will be impacted upon as well.

4) Experiment with contracts for major goods - electricity, water supply network
s, oil, steel, cement, natural gas to name just a few. This is best done before
starting a new game. You will get an idea which goods traded provide the best bo
ost to growth.
5) Contracts that provide a massive boost to growth (i.e. add several percentage
points on) should be done near the end of the year. The one that provides the b
iggest boost should be done on or around 1st December. The next biggest should b
e done on the 24th November and the one after on the 17th November, and so on. Y
ou get the idea. The reason why trading should be done this way is because of ho
w inflation works in the game. Inflation will generally move to align with growt
h. However, on 1st January of each year, inflation is reset. Growth is reset on
or around 8th January. This means you can exploit this feature in the game to ge
t high growth but without the terrible inflation that goes with it. Growth could
tail off sharply at the turn of the year, which is perfectly normal.
6) Always renew your contracts for raw materials like the ones I mentioned earli
er. If you don't, the economy will lose the benefit from those deals, and a big
recession is possible. Renew each contract one day after the 5th anniversary (co
ntracts are set to 5 years duration by default).
7) There is an element of what I call "Developer's logic" in the game. This is o
nly one but the most important example of how it applies in the game - importing
something you already have a surplus of. This would happen in countries like Am
erica, the UK and other developed nations. In the game, these countries have sur
plus electricity. What I am about to tell you defies all logic, hence why I call
it "Developer's logic" (since it must have made sense to them at the time) but
import electricity you don't need if you can get a decent discount on it. Do the
same for water supply networks. This sounds crazy but it works and boosts growt
h. A single deal can add several percentage points on to the growth rate. The id
eal starting point is to import volume equivalent to about 10-20 per cent of tot
al demand (supply and demand are indicated in the contracts book).
8) Only buy things off countries that have a surplus to sell. This sounds like c
ommon sense but sometimes the game lets you buy things off countries that can't
meet their own demand. If you made deals with such countries, they could be diff
icult to renew so don't bother.
9) If you choose to let contracts drive most of the growth then you need to keep
growth for the 10 or 11 months of the year (depending on when you intend to sta
rt trading) as low as you can. This is so inflation can be kept as low as possib
le.

10) If you decide to run your economy on cheap imports, it's best to keep your c
urrency strong. Raising interest rates to at least match, but preferably exceed,
inflation should be done at some point. With the currency rising, the discounts
will on the imported goods will be larger when renewal time comes. So you can s
ometimes keep or enhance the growth you've achieved whilst actually shrinking th
e volume of the trade deal! Oh, and these imports do not necessarily cause the c
ountry's trade deficit to spiral. In my experience, the trade balance improves!
But it does seem to depend on what you do with the revenue generated from the ex
tra growth.
11) Always save the game before engaging in a trade deal.
Whether you go down the "contracts" route or not, you'll be spending most of the
year encouraging "natural growth". I've already explained the tools available f
or you to do that. I'll give you some specifics on tax and fiscal policy.
1) Cutting the "Tax on company turnover" boosts industry, is usually fairly chea
p to do, and can pay for itself. Cutting the "Employers' Social Security Contrib
utions" rate is reported to have the same effect in some cases. Cutting business
taxes is generally the best way to encourage growth in the early years of the g
ame.
2) Fiscal consolidation works in these GPS games. You can cut spending and the p
rivate sector will pick up the slack. The country won't end up with massive unem
ployment if a full-blown austerity programme is embarked upon.
3) Fiscal discipline doesn't have the same deflationary effect that it does in r
eal life. In the game, inflation will only be affected at any one time in-so-far
as economic growth is affected. The same rule applies when changing interest ra
tes.
4) Public spending is sadly rather cosmetic most of the time in my experience, a
nd not adding to growth. You are able to increase spending on education and othe
r areas where in real life it would make a difference. But in these GPS games, p
ublic spending seems more orientated towards social outcomes rather than economi
c growth. Even the much-lauded research discoveries seem to make little differen
ce to growth for the most part. You can cut a lot of spending all in one go and
sacrifice a chunk of your popularity but this is something I would recommend onl
y to experienced players. It's a quick way of cutting the deficit if you want to
play a short game with a different country.
5) Income Tax is regarded by the game to be a "purchasing power" mechanism. In o
ther words, it seems to imply that consumers' ability to afford things is determ
ined by the Income Tax rate, which is of course not entirely realistic to put it
mildly. However, VAT is not regarded as a "purchasing power" mechanism in the s
ame way. So you could increase, or in the case of America, introduce VAT and use
the money to cut Income Tax with the result that you have increased purchasing
power!
6) If you want to introduce VAT in America, you need to set it at a very low rat
e to begin with, say 0.06 per cent.
7) Debt interest spirals out of control much faster in the game than in real lif
e so it's a good idea to clear the deficit and start paying off the national deb
t. Debt interest is re-calibrated at the turn of each year.
8) If you're going to cut spending in America, the biggest savings will come fro
m withdrawing the troops from foreign countries. Generally as a rule, the top th
ree categories under the "Health" tab should be cut to 5 stars if big savings in

spending are to be achieved. But in RoN, they're close to or below this level a
lready and this probably the case in the MotW as well. The "coverage for work ac
cidents" can be scrapped altogether with no repurcussions at all. The lower heal
th categories from "Maternity" down to the bottom can be maxed out at a fairly m
odest cost and is something I always implement as part of my day one policies.
9) Population growth is an indirect form of inflation. It is often out of alignm
ent with both the real recent and historical averages of countries in the game.
Check the "Population" tab to see the rate of population growth. In real life, p
opulation growth is around 0.8 per cent in America at the moment but is likely t
o be a lot higher in the game (it certainly is in RoN). There is an easy trick t
o bring the population growth down so that it more closely aligns with real life
- go to the "Immigration" tab and select "Forbid entrance to the territory". It
won't shut off all immigration as the term implies, but it will bring it right
down. The effect will be felt within about two months or so. And as a bonus, you
can then cut the "Fight against clandestine immigration" under the "Police" tab
down to 1 star. The number of illegal immigrants seems to tick up at the same r
ate regardless of how much you spend trying to tackle the problem. Population gr
owth will fall throughout the game as the birth rate declines. If the birth rate
gets too low, build maternity hospitals to boost it. Again, this sounds bafflin
g but it's how the game works.
10) As real-life Japan has discovered, deflation can be a terrible thing, encour
aging consumers to hold back and wait for a better deal. Well, this doesn't happ
en in the game. Deflation is actually good in the game because it cuts your expe
nditure without cutting revenues.
One final tip for now - always repair unhealthy housing regionally. If you try t
o do it nationally from the "Housing" tab, there is a bug that is triggered that
eventually leaves you with no manpower to build anything. Many players confuse
the "manpower bug" with a 0.1 per cent unemployment rate, but they're unrelated.
I think that's enough to be going on with. I appreciate that there's a lot to di
gest but it will save you a lot of time - and you certainly need plenty of time
if you want to play a long game.