Game mechanics are the invisible mechanisms that influence player motivation, progression, and continued engagement. A well-designed game economy is clear and fair. If not, it leads to monetization issues, player churn, and frustration.
In this article, we explain what game economy design is, why it matters, and how currency systems support healthy, scalable games.
What is game economy design?
Game economy design is the development and balancing of all systems of resources, rewards, costs, and game growth. This includes player advancement pathways, sinks and sources, reward cycles, currency, and pricing.
Why game economy matters in mobile games
In mobile games, especially casual and arcade games, economic systems directly impact player retention and revenue. Players constantly interact with the economy by deciding how much to spend, earning incentives, and assessing whether progress appears fair. A well-designed economy maintains engagement, encourages progression, rewards investment in skill and time, and offers meaningful choices. On the other hand, poor balance quickly erodes trust and alienates players.
Key elements of a game economy
The production and consumption of resources are balanced in every working game economy. Through games, players acquire resources that they can use for bonuses, customization, or advancement.
The key is to maintain balance. If there are too many resources, progress loses its value. If there are too few resources, they feel blocked and frustrated.
Game currency design: the foundation of the economy
The main way that players engage with the economy is through game currencies. The currency design dictates how players obtain, save, and spend value in the game.
Most mobile games use both hard and soft currencies. Hard currency is rarer, tied to premium purchases or long-term rewards, while soft currency is earned during normal gameplay and used for basic advancement. This allows developers to contribute revenue without affecting the core gameplay. You can also add special event currencies to regulate the rate of progress in additional events or seasonal content.
Sources and sinks: maintaining a healthy economy
Sources of currency determine how players earn resources, while sinks determine how players spend those resources. A healthy economy carefully balances both.
Too many sources without meaningful sinks lead to inflation and the trivialization of progress. Players become irritated by bottlenecks caused by an excessive number of drains without sufficient supplies. Particularly in live service contexts where fresh material is continuously upsetting the equilibrium, economy design should change along with the game.
Progression, pace, and player motivation
Early progress should feel fast and rewarding, while later stages naturally slow down to maintain engagement.
Well-paced economies smoothly guide players from adaptation to mastery. They create expectations for improvement, encourage goal setting, and support both short sessions and long-term play.
Monetization and fairness
Monetization should be seen as a shortcut, not a requirement. Non-paying players can make meaningful progress incrementally. Paying players get extra convenience, cosmetic items, or accelerated progression.
Fairness and transparency are critical. Players quickly spot manipulative systems that can permanently damage player retention and brand trust.
Economy testing and iteration
Game economies should never be “set and forget.” Iteration based on data is crucial. Soft releases, A/B testing, and real-time analytics can help teams identify inflation, bottlenecks, and unpredictable player behavior.
As new features, audiences, and content are added, iterative tweaking makes sure the economy stays strong.
How to read a game economy diagram
A game economy diagram is a visual map that shows how value flows in a game. It helps designers, developers, and stakeholders understand how players earn resources, how those resources are spent, and how progress is tracked over time.
At the center of the diagram is the player. Every player action (leveling up, winning matches, watching ads, or purchasing items) is associated with a flow of resources. These flows are typically divided into sources and sinks.
Sources represent the origin of currencies and resources. These include gameplay rewards, daily bonuses, event prizes, achievements, and monetization entry points such as in-app purchases or rewarded ads. Sources determine how quickly players gain value and how generous the game feels.
Sinks show where resources are spent. Common sources include upgrades, content unlocks, retries, crafting systems, cosmetics, or participation in events. Expenditures control the pace and remove excess currency from the system.
Between sources and expenditures, the diagram often includes progression gates. These restrict access to content based on player level, skill, time, or resources. They provide a controlled pace for players to progress.
In well-designed economic diagrams, flows are balanced and interconnected. If a source provides too much value without corresponding absorption, inflation occurs, and progress becomes insignificant. If absorption is too high, players feel blocked and frustrated.
As the game evolves, so do the economy charts. Seasonal events, new currencies, and additional sinks are layered onto the existing structure, and the diagram helps teams predict how these changes will affect player behavior before they are released.
Teams can identify risks, make informed decisions, and maintain a fair and engaging economy as the game progresses by using the economy diagram early in development and revisiting it frequently.
Common game economy diagram mistakes
One of the most common mistakes is developing too many resources and not enough sinks. This leads to currency inflation, devaluation of rewards, and pointless progression.
Another common problem is placing sinks that seem necessary. When players have to spend money to keep playing, incentive is replaced by frustration. Good sinks provide value and choice rather than stress.
Many teams also separate economy design from gameplay design. When currency systems don’t support core mechanics, spending feels artificial and breaks immersion. The economy should support the way the game is played, not exist as a separate layer.
Ignoring endgame behavior is another critical mistake. Because of exponential costs or the absence of large sinks, the economy frequently functions effectively for early growth but collapses at higher levels. Economy charts should always include projections for the mid- and late-game. Games evolve, as do economies. Regular chart updates help teams adapt to new content, features, and player behavior without creating imbalances.
Create balanced game economies with Melior Games
At Melior Games, we help publishers and studios create, test, and refine game economies that meet user needs and corporate goals.
We provide outsourced game design and development services that cover:
- Economy and progression design
- Currency systems and monetization logic
- Game design, development, and QA
- 2D and 3D art, UI/UX, and animation
Melior Games’ skilled teams and their development experience are ready to help you with your project.
👉 Collaborate with Melior Games to develop games with economies that are engaging, fair, and geared toward sustainable success.
