Eve Economics 101: Baskets & Bottlenecks

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Nicely written ♥
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"It goes without saying that if you're trying to create a resource system without bottlenecks, "fixed output" and "fixed number of sources" should scare the hell out of you."This is correct - but the exact opposite (abundance of resources) is equally bad.In fact in Game-Design you need (dynamic) Bottlenecks for players to strive for them and even wage war for them.Simple example: We have 4 resources, each in every corner. You can "mine" each resource in about a third of the map (so in the middle of each side you have about 2 ressources you can mine "ok"ish, and every corner where you can mine 1 resource well).In production every material are consumed equally (if you sum it all up), but diversive (if you look it a specific item it uses basically only 1-2 resources).Depending on the items built (and used!) the value of the resources vary. If one Item/Ship/.. seems to be OP for fleets, a temporary Bottleneck builds up on 1 Resource. This makes this Shiptype/Fleet-Comp/.. expensive and other partys can easily outperform you ISK-wise by throwing stuff at you.Additionally the Region of Space gets more "valuable" (NOT by design, but emergent!), so one colition might say: Nice Space you have there. We take it!Even smaller conflicts in Regions (harassment with afk-cloakies, hotdrops, roams, ...) can impact the availability of those resources, thus yielding temporary imbalance and player action.--I think a major flaw is that Minerals are distributed by sec-status. I would rather see that the Ore AMOUNT is distributed by Sec-Status. So if there are so many High-Sec-Miners: Too bad. Rocks are gone. Try scanning some Grav-Sites .. but if they find some site, then there will be some ABC-Ores in it as well (only in a very small amount .. i talk about 1-2 baches there, tops).Adittionally there should be no "+x%-Ore" in 1.0-Systems. I would add another +10%-Ore each 0.2 Sec-Status. So that you have +100%-Ore in -1.0, basically rewarding you for more Risk.Even the +20%-Ore in 0.5/0.6 would attract more ppl there (where they are more gankable, thus yiedling more risk).I would also continue the "not equal distribution" from the empires (ores that can be found in empire-lowsec can be found at least in 1 empire-0.5/0.6) to 0.0. Having everything available everywhere in equal amounts is plain stupid. Changing each of the first 2 everything to "nothing" is stupid as well. So you should have everything everywhere in variing amounts. This is especially important for "ring mining" or any other form of distribution of more than a hand full of resources.---In my own game (yeah .. wrote a browsergame back in the days .. 'bout '02/'04) i had the amount of harvestable resources fixed with a dimishing amount harvestable over time.To adapt this to a growing game i would suggest that there are only x Minerals harvestable in the game per account (minerals used in assets count half). Its just an idea. Think about it.Thats just my 2 cent.PS: further reading: http://pwning.de/stuff/eve/mat... - https://forums.eveonline.com/d...
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This is the kind of article I love. Keep it coming.
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The examples used to illustrate the basket effect are somewhat misleading as to what it is. First, common minerals are not supply-bottlenecked (not in the same way moon minerals are), still there is a basket effect. That is, a change in availability or demand (and consequently price) of a specific mineral will be met by an inverse reaction of the price of the other minerals in the basket.
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Why didn't you bother to suggest a solution in your article? I feel like it's lacking a.. 'point'.
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That is not what a basket is.http://en.wikipedia.org/wiki/M...On a more stylistic note "limiting reactant" would be a bit better than "bottleneck". Basically the same idea, but bottleneck tends to speak to performance while limiting reactant is precisely what you described in your bottleneck example.http://en.wikipedia.org/wiki/L...---More on topic - "if you're trying to create a resource system without bottlenecks"Who said anyone is trying to do that? It's not only an impossible goal it's a boring one. Now obviously Tech was way out of whack, but generally speaking these limited resources are the things that make the game interesting. Even Tech certainly did its job in showing us a lot of unique, emergent gameplay.
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The solution to the highsec and null mining ISK gap is to produce ships and capitals for your alliance. Not to pay the cost of getting your minerals to jita.
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It's not exactly the same thing as the "market basket" in the article but closer to what is examined in "market basket analysis" by a supermarket. I stand by the term. ;) Good point on the limiting reactant though...And, you're right that a system without bottlenecks is boring. Nonetheless, that IS what CCP was attempting to do when they nerfed dyspro and prom back in the day - eliminate the bottleneck and spread value to the less expensive minerals. Instead, they moved it. I'd argue they'd have been better off resetting BACK to dyspro and prom being the bottlenecks - at least they're distributed across Eve, giving an alliance a chance to climb the chain from small holder to big holder, instead of merely being a Tech lord or not. A similar argument could be made on the mineral nerf - in removing the drone regions they attempted to restore a bottleneck on high ends so as to enrich nullsec mining, and instead low ends (or a low end, things are still shaking out) are the limiter.
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Because its a complicated problem with multiple solutions depending on how you want to go. I could write an entire article full of novel and interesting (well, to me) solutions. For example, mining could be addressed by adding huge low-end asteroids to nullsec gravimetric sites while simultaneously introducing crystals that have triple yield on low-end ores and compress the ore for you as you go...and also nerfing the instant respawn of those sites, because that's dumb. But for that to be a good solution, CCP would have to agree that they need to give nullsec mining a proper buff that also bolsters nullsec industry, but at the cost of mining in highsec.
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I just realized how dumb that sounds. Anything that restores the value of high end minerals will come at the cost of value of low end minerals - that's the whole point of the article! Teach me to post after just waking up. But, you get the idea - it's a complicated problem to solve, and I wanted to keep it concise.
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Uh...no.Here's the problem with that idea. An entire Large gravimetric site, stripped completely clean of all ores, yields a grand total of 5.1 million units of Tritanium. Stripping the entire site takes just under 41 man-hours with perfect skills in ideal conditions. And for all that effort, the Tritanium you yield builds half of a Maelstrom, if that.Nullsec is and always has been setup such that the most effective thing to do if you want ships is to mine the high end minerals, export them, sell them, and import either low ends or ships themselves. Without a significant revamp, that won't change.
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If CCP were to change that 250k spodumain asteroid in the small belt to an equivalant volume of veldspar the trit problem in nullsec would be over (bear in mind however that asteroid would contain 40 million units of veldpar)
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I disagree - making locally sourced nullsec industry possible isn't just a matter of saying "okay there's way more low ends in your belt, have fun guys." The other aspect is to make the production side of things not suck. Consider: Sobaseki is full of stations with 50 slots, enough that that one system has more production capacity than most nullsec regions, and every single one of them is also a 50% refinery. In nullsec, you get maybe two or three (if you're lucky) conquerable stations per region, which are 40% refines and 50 slots. Beyond that, you get refinery stations, in which you can reach a perfect refine, OR production stations, which have a decent number of slots, but not both in the same system. If you're lucky, your alliance spent tens of billions of isk to buy an upgrade to give the refinery station ten production slots, though odds are they also locked those slots down for alliance business. So, if you want to build anywhere but that conquerable station, you get to freighter your minerals between systems, in nullsec. Have fun!Basically, CCP either gave us the ability to drop multiple stations per system, OR gave us our money's worth for station upgrades (I mean look at what faction warfare gets in lowsec!), that would be a very good start towards making nullsec industry viable. After that you could start thinking about mining buffs to encourage people to mine to supply that industry.
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You can mine the low ends in belts, or import. The mass of all the minerals produced from a mining team with a perfect booster makes it a pain to get it to market from deep null. Instead you can make ships for 10% above jita or whatever your alliance allows. The fact that trit is in null system, does allow for null to be independent from Highsec. This is not nearly as significant as not having ice in WH space, and making WH dwellers dependent on other space.
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That is a very good point, add into this the lack of corp offices available in almost all of nullsec and even the prospect of remote production from a pos is made even more problematic and risky since no sane person would want to risk inserting BPO's (some of which are worth billions in their own right) into a pos array.
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You've never done large scale production of battlecruisers or battleships then. My corp has a nigh unto constant demand for trit and pyreite and we have several very dedicated miners, a pair of whom can maintain industrial index 4 by themselves. We have people who actively mine in belts for low-ends and it still isn't enough.As to the WH issue. CCP never intended people to live in W-space permanently. They have stated this on numerous occasions.
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Things shouldn't always be equal. I love a game that has market drops, and spikes in prices, and the occassional market depression, it makes the game closer to real life, and way more interesting. CCp's occasional monkey wrench makes everything stirred up, and people get to moving, and thats good. I have said it many times in other places that CCp was not thinking straight if they truly believed the null mining profession would become huge after the drone region nerf. No one who enjoys being a miner (someone who likes playing eve, shootin' the shit with buddies, and all around mello and lazy basterd) will want to be in a place where they can die so easily. There's a reason why so many of my buddies dissapeared during the goonie gank rage
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Doesn't change the fact that if minerals were price-balanced as CCP seems to envision, there would be no point to mining low ends. Why mine veldspar for 30m/hr if you could get 50-60 for crokite and arkonor and such? Besides that, there are the infrastructure issues, which I elaborated on above. I agree with urziel99 here - you've clearly never done large scale production in nullsec.
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Yes you want players to wage war over bottle necks. But when the biggest bottle necks in EVE are in 1 area mostly the North-West Thats where most the fighting will come and then after no fighting or like whats happening now 95% of the population deciding to make a cartel and hold hands [Sorry but its true CFC] while 5% stir up the pot and fight against it.By Evenly distributing this huge wealthy moon to every single part of eve, Minor wars would break out all over, Provi,Curse,Stain,Delve,Catch,Querious etc etc...They have made basically 2 ways for an alli to make money Tec Moons, or renting out space to carebears and protecting there sov while they ratt and mine.So if the spread the moons the problem would go away but you would see tons of alliances fracture and reform with other partners etc....War would not be in 2 areas like it is now bu tall over Eve. And we need to get rid of the OTEC cartels, we all know that even GSF knows, its just they will have had 3+ years with all the Tech like BoB had whom they hated so much for the same reason.Really GSF of now is almost exactly BoB of 2006, massive and Blobby with Pets who wanted in on the Prom, and GSF hated them for it....Just funny they mirror each other now that GSF is in there same position.
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it's a very nicely written article but calling out CCP and the CSM on their bad predictions without highlighting one's own mistakes (high-ends!) in a similar fashion feels dishonest.
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Technetium would be worth a lot less if people would actually have decent setups on their cobalt moons (medium POS, simple reactor, etc.) but they put up small towers and mine the moon mineral in question and sell it to market. It would be cheaper and more profitable to put medium POS's on cobalt moons to both mine cobalt and react it with platinum. This involves less running around and fewer middlemen to produce the finished product. The price would be lower if people were smarter.It will be interesting to see what the price of tech does after the tech 1 logistic cruisers come into being. Seeing as tech 2 logistic ships are in fairly high demand and use a fair amount of technetium in their construction. This is course on top of the mining buff in which very few miners get suicide ganked nowadays and they are using cheaper ships to mine.Cobalt alchemy isn't something everyone is aware of and yet it doesn't take much to get one of these moons. There doesn't appear to be any fighting over them either even though they are fairly profitable to hold on to. Once all cobalt moons are taken and running profitably technetium prices should begin to drop down close to what it takes to run alchemy operations.
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I like the sec status being about ore amount rather than type.
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I agree with basically everything here except for the part where you call our allies in the CFC pets. ;)The worst part, though, is that CCP is busy nerfing tech instead, and plans to nerf it more. If they have plans to offset that nerf in other ways, be it re-distributing moon wealth somehow or, better yet, making it possible for an alliance to function by taxing its members nullsec activities (instead of renting space to botter farms), they sure haven't been very loud in saying so.
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Don't forget all those booster manufacturing slots we get in nullsec outposts (except the minmatar one, I believe) - even though booster production is a complicated black art that nobody bothers with unless they're really really dedicated, requires a PoS for the reactors, and the materials for booster production are even more regional than moon minerals.
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Maybe a step change might be in order. Its logical, just like in RL, that raw materials tend to be readily accessible in remote areas where well developed locales are best at advanced industrialized production. As such, CCP could make the gathering of all resources most productive in low and Null sec and make advanced production most efficient or only safe in empire. CCP would have to develop desirable interactive game content around production and manufacturing as manufacturing today consists of some throw away skills and a BPO that you can get and research anywhere.For example, lets say all ships consists of components built in stations that have to be assembled by builders that transport the pieces to a space dock/gantry and assemble it--perhaps with a special manufacturing barge that serves as a forklift, welder, tool box, and test gear and goes into a sort of triage mode while building. I have no idea if this would be fun for all the space hobbits in High Sec, but then the very idea of mining makes my eyes bleed.Also, It would be nice to see resource volumes fixed. It makes no sense that a block of raw materials, takes up less volume than the finished product. That is like saying a pallet of densely stacked sheet metal has more volume than the cars it is used to produce with all their empty spaces and compartments.
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The difference between my early predictions on high ends and CCP's mistake(s) is that CCP should have access to full information whereas early on I didn't grasp just how much of the game's low ends supply game from the drone regions. ;)
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Definitely agree that Tech will steadily drop, it's still WELL above its theoretical floor value from alchemy. Cobalt is too common to be worth fighting over, though.I don't see T1 logistics cruisers supplanting T2 cruisers, though. They'll let you bring logistics on slosh ops and other suicide-ish fleets, and they'll let newbies get into and learn the logistics "profession" on the cheap with far less training, but they're not going to replace T2 where T2 sees use, I expect.
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Please help me articulate my idea on how to fix this dude. It goes well to compliment this article.
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"Unlike moon minerals, the sources are not fixed. Veldspar and other low end minerals are plentiful and abundant in empire, and virtually untouched in Nullsec."Virtually untouched? You must mean "virtually non-existent". Anyone doing mining in null for production purposes vaporizes Veldspar the second it spawns. There's not nearly enough.Minerals (well, ore, they're used interchangeably it seems) should be distributed in roughly even proportions in all security. Null should just have more/better grades of them. Hi sec = regular grades in small asteroids >>> null = enriched grades in large asteroids. Plus Merx. Favor the balance a little towards the trit/pyro ores in high, and towards the exotics in null.
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What I think would be a good solution to the moon mining situation would be to make it more like PI. Let the harvesting be in the hands of the players. This would increase the value of the POCO at planet as each planets POCO would work for the surrounding moons. You allow for the tax on moons to be independent from the planets extraction rates. This way the alliance that hold the moons can have a heavy tax while still allowing the players to make isk from these at the same time. This would end the arguments about free isk and make it more hands on with the players involved. I am not a big fan of the ring mining idea but I think this would be a good solution. You would also have your reactions happen planet or moon side. Just my idea but I think it would be a good direction for the game. This would also allow for people to mine moons in empire but just like planets your production is severely hampered by the level of sec the system is.
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You seem to believe that there is an abundant source of low end minerals in 0.0.There is not, it's no better than in empire.
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The predicted effect by some people regarding high end minerals was completely and utterly disproven time and time again on Eve Radio (Tuesday night plug). Anyone who knew anything about the realities of gun mining and production in testing regions knew the high end issue was entirely without merit. But, I applaud the fact that at least now, the reality has been proven. High ends were in fact hurt way back in the day, at least from their highs, by a number of factors. But the depressed prices, both before and after the alloy nerf, are te direct result of increased supply related to "hidden belt" grav sites. The sad part about the alloy nerf is the direct transfer of mineral wealth benefit from 0.0 to high sec. Take away te alloys and hisec mining was instantly more profitable. Lets not even get into the massive inflationary impact seen across all mineral based production lines. Stabilize the mineral market by reversing the drone region change. Drones were the mineral bread basket of new Eden, supplying everyone with reasonably priced ship to lose all day, everyday.
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I agree with you. Ring Mining sounds flashy and neat, but its a completely new system and CCP will have to devote a lot of development time to get it right. I'd rather see them use pre-existing mechanics and spend the dev time fixing OTHER parts of null than I would see them spend ALL their time on ring mining and simply stop there, saying OKAY NULL IS FIXED GUYS WE'LL IGNORE YOU FOR ANOTHER THREE YEARS!
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Answer me this: What incentive does a pilot in nullsec have to mine low ends if he already mines high ends in empire? What does it gain him? Answer: Nothing, except for having to deal with extra logistics.
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great article, well done. CCP are you reading this?
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alloys supplied almost 90% high-sec minerals. So there lost influenced high-sec minerals much more than it influences ABC roid mining. This is why tri/pye prices changes more than megacyte for example.
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Nicely written article, thanks for the time it took to research and construct it.

 

Most players in this little spaceship game are familiar with Technetium and its outlandish price, and veterans will recall Promethium and Dysprosium before it. What people are less familiar with are the interactions that drove those prices to their astronomical highs. Importantly, these same interactions drive the market prices of all raw materials in Eve.

Baskets & Bottlenecks

Understanding how raw materials are priced in Eve requires combining two concepts: Market baskets and bottlenecks.

A basket refers to a group of goods that a consumer purchases together. In retail, stores often discover these things through research and analysis. A common and likely apocryphal example is of a grocer who realized that customers that bought diapers often bought beer as well, and so saw a boom in sales for both after placing them together. In Eve terms, a pilot who purchases a Vagabond can be counted on to purchase a set of fittings... and probably an Exotic Dancer as well. Alternatively, for an example more relevant to the topic, a pilot purchasing Tritanium for his own use will very likely buy Pyerite, Mexallon, and other minerals.

A bottleneck occurs when a system is limited by a single component. In our terms, it is the item or items within a basket which is least well supplied relative to overall basket demand. If I have 10,000 Tritanium and 6,000 Pyerite and the item I wish to build requires 1,000 Tritanium and 500 Pyerite, than no matter how hard I try, I can't build the twelve units that I have Pyerite for - Tritanium is my bottleneck. Of course, in this situation I simply buy more Tritanium, and all is good. Project this phenomenon game-wide, and you have the bottlenecks in Eve.

Moon Wars

The astute reader has probably assumed that I'm actually talking about moon minerals. They're half right - moon minerals are the most common example of the bottleneck & basket interaction, but we'll certainly revisit regular minerals later. Moons have a fixed output, and of course there are only so many of them. It goes without saying that if you're trying to create a resource system without bottlenecks, "fixed output" and "fixed number of sources" should scare the hell out of you. Even with careful balancing, it's all too easy to create a situation in which the supply of one resource comes up short.

In the "old days", prior to Dominion, the end state of this system was that Dysprosium and Promethium were the bottleneck. As a result, they were immensely valuable, reaching over 180,000 isk/unit, or 13 billion isk per month per moon before fuel costs. After alchemy - a means of producing intermediate materials with alternatives to the Dysprosium or Promethium - failed to have any effect, CCP took action again, tweaking the blueprints for Tech II components in an effort to spread some value to less valuable moon materials. Instead, as they were warned, Technetium became the new bottleneck. That Technetium is restricted to the northern regions of Eve only exacerbated the problem.

Now, once again, CCP has tried the alchemy solution. While the new alchemy did a much better job of lowering Technetium prices, it did nothing to spread value through the basket - only platinum, cobalt (both alchemy ingredients) and Neodymium (the next in the bottleneck line) rose in value.

CCP has promised "Soon™" to revisit moon minerals, with the stated intent of "changing how they are produced." Many players take this to mean Ring Mining. Only time will tell, but we can only hope that CCP has learned its lesson.

Unfortunately, recent history suggests otherwise.

The Drone Alloy Fiasco

The drone regions were introduced to the game in Revelations I, the winter expansion of 2006, and featured Rogue Drones as their NPC dwellers. As most players are aware, these rats are unlike others in the game in that they have no bounties - a player must loot the alloys from their wrecks and refine the minerals contained within to receive their payout. While this system was originally met with plenty of complaints from players ("I have to do extra work to get paid!") pilots quickly realized that their extra work was met with extra reward, as well. Over the years, population within the drone regions grew, and across the board, mineral prices dropped.

And dropped.

And dropped.

The drone regions had effectively eliminated bottlenecks in mineral production. Everything was supplied in enormous quantites, and everything was cheap. To highsec miners, this was of little consequence - highsec minerals were already cheap; if you're mining 23/7 the difference between 10 million and 15 million an hour is academic. In nullsec it was a different story. "Gunmining" had a particularly large effect on the price of high end minerals, dropping their price over time by upwards of 80%. Supercaps became a common thing, enormous wars became the norm, and so demand followed supply, inflating in a big way.

In an effort to change this, CCP took the combined action of removing Meta 0 (manufacturable) loot from NPC drop tables, and nerfing Rogue Drones by giving them bounties in place of the alloys they once dropped. The expectation was that the high end minerals would spike in price again, and the casual and hardcore nullsec miners alike would reap a great bounty, which they did.

At least, until reality caught up and burst the bubble.

A couple of things went awry with CCP's grand plan. Mining had changed significantly since the drone regions were introduced. Mining yield had increased dramatically thanks to Rorquals and Tech II mining links, while theoretical supply was virtually infinite due to gravimetric sites that respawn almost instantly after being mined out. When prices for high-end minerals spiked, miners reactivated long dormant accounts and rushed to the belts, and they were able to make up the shortfall left by the nerfs. Meanwhile, upwards of 70% of low ends were also supplied through gunmining and loot drops, a fact which CCP may not have considered. While prices were suppressed for a time by enormous stockpiles, those eventually broke, and the ramifications are clear on the market today - the mineral bottleneck flipped, handing highsec miners a bonanza, while nullsec is worse off than ever.

Unlike moon minerals, the sources are not fixed. Veldspar and other low end minerals are plentiful and abundant in empire, and virtually untouched in Nullsec. Unfortunately, there almost certainly are not enough miners to make up the difference in Empire, even with it turning into an laughably safe carebear themepark, and the nullsec low-end supplies are untouched for logistical reasons. On the other hand, nullsec miners have demonstrated the ability to fully supply high ends, even meeting the outsized demand left by drone region supply. As a result, nothing is likely to change without drastic action from CCP.

A note on numbers

"How can you make these conclusions? Where does 40%/70% come from?" By mining data from various devblogs and interviews and making some judicious assumptions, painting an approximate picture of Eve-wide mineral production at several points early this year was possible.  While the estimates are not exact, the conclusions clearly are spot-on.

 

Seven year veteran & economics guru of EVE Online as well as CSM 8 representative. On the side I play PS2, WOT and Hearthstone.