How to Build a Thriving Fantasy City Economy

In this episode of Worldbuilding Blueprints Season 2, we'll discuss everything you need to create an EPIC economy for your fantasy city that a real economic historian will be proud of (yes, even if does include magic :D )

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Chapters

• 0:00 Economics is Underrated
• 0:41 Core Economic Resources & Activities
• 3:49 Labor & Economic Class
• 10:35 The Flow of Goods
• 20:41 Infrastructure
• 28:16 Governance and Regulations

Transcript

Most fantasy cities are economically inept, even if the worldbuilder tells the audience how rich that city is all day long. That's because most people don't really understand the complexities of a city economy and what it takes to make it work. Today, we're going to change that. We're going to pull back the curtain on what it takes for a fictional metropolis to be self-sustaining and impactful. Welcome to Season 2, Episode 4 of Worldbuilding Blueprints.

First, let's talk about what makes your economy go. There are three core pillars that form the heart of a city's economy. The first is your economic activities and core resources, so let's start with that.

As we've discussed quite often in previous episodes of this podcast, all cities begin with a reason. And that reason influences the way the city's economy shapes, and it deeply impacts core wealth and economic objectives.

A crossroad city would be focused on trade, with an economy that sets up markets, transport hubs, good roads, and guilds that ensure smooth loading and unloading. A defensive bulwark city, on the other hand, is focused on military matters with smiths, armorers, and businesses catering to the entertainment of soldiers, if you know what I mean. It probably also has high taxes on its citizens in order to pay for the army.

A religious capital will have a plethora of religious artifact sellers, teachers, and so on. A resource city would have all its economic activity focused on extracting, processing, and probably exporting that resource.

And of course, as we discussed in the previous podcast episodes, your city's purpose could change over time. So bear that in mind when defining your core economic activities and resources.

And don't forget about the magical and fantastical resources here. Some goods may be one of a kind to your world's magic system. Think of mithril in Middle-earth or the spice melange in Dune. If a city has a monopoly on a magical resource, it becomes incredibly wealthy and strategically important. Others might go to war over that resource or try to steal the secret behind it—like the Byzantine monks who smuggled silkworm eggs from China to break the Chinese silk monopoly.

So for your city, consider its founding purpose and its current purpose and consider the cause that it has built up for that purpose. Then think about what its economic activity is. Does it manufacture goods? Does it import a lot of goods and export mercenaries? If it imports goods, this represents an economic risk. How is that risk managed? Are there resources that are critical to the city's economic life, and how does it manage that critical need?

Okay, so that is your core activity and resources.

Our second pillar of what makes your economy go is labor—or who’s doing the work. Labor is the lifeblood of a city's economy. Who works which job under what conditions, and with what organizations backing them? Economic class structure often emerges directly from labor roles.

Broadly, we can break urban society into classes by economic role.

Elites, patricians, and nobles: in some cities, a hereditary nobility owns a lot of land or holds official titles, getting wealth via rents and taxes rather than trade or crafting. In other cities, wealthy merchants might blur into the nobility. For example, Venice’s rich merchant families became its nobility in the late Middle Ages, shading into the Renaissance. These people might not work in the usual sense. Instead, they manage, they administrate, or they simply invest. They often live in the best districts near the core if that’s prestigious, or in spacious manor suburbs if the core of the city is crowded and dirty.

Our second class is guild masters and merchants. This is the bourgeoisie of the city—prosperous but not normally noble. They own workshops. They run trading caravans or shops and have apprentices or laborers under them. They are typically literate, money-savvy, and keen on city governance because stable politics favors business. They may build impressive guild halls or sponsor civic projects—cathedrals, orphanages, libraries, and so on—in order to flex their wealth and show off their status.

Our third class of people are skilled tradespeople and journeymen. This is the next rung down on the trained workers. These are journeymen in guilds, your independent artisans without a guild of their own (if this is allowed under the city's regulations), your clerks, your scribes, and so on. This category of citizen has a decent livelihood but not much power, and many of them hope to eventually rise to master status. They might rent modest homes or apartments, often in mixed neighborhoods where the employment and the home are close together. So not the slums, but not the rich lanes either.

And then we come to laborers and servants. This is the bulk of the urban poor. Your factory hands (if that kind of proto-industry exists), your dock workers, your carters, your domestic servants, your cooks, your laundresses, your street vendors, your pure-finders, your knocker-uppers, and so on. They typically live wherever is affordable—crowded tenements, back alleys, or informal shanties near their workplaces. They have very little job security and are most vulnerable to economic downturns or price spikes.

And then your last class is your underclass. These are your unemployed, beggars, thieves, your enslaved people if slavery exists in your setting, and other marginalized groups. They survive on the fringes, which could mean literal fringes of the city like a tent camp outside the walls, or crime-ridden quarters inside your city—your shadow cores.

As we spoke about previously, a city with a robust economy will always have an underclass. No matter how good its economy is, there will always be disabled beggars or refugees and so on. A city which has fallen on hard times will see this underclass swell dramatically as the laborers and servants experience economic shock and fall out of the urban poor and into the underclass.

Of course, magic and fantasy can have an immense impact here. If magic can replace human labor—for instance, with golem workers or animated tools or bound elementals that do the heavy lifting—the economy could be radically different. A city with golem laborers might produce goods cheaply and quickly, perhaps undercutting other cities’ prices and dominating trade.

But it might also have social consequences, resulting in widespread unemployment or protests from laborers put out of work by such constructs. Culturally, people might resent or fear soulless golems taking their jobs, very much like in the Industrial Revolution with people fearing automation.

Alternatively, maybe only one guild has the secret of making golems and they rent them out at high cost, meaning only the rich benefit from automated labor. This would reinforce class divides rather than eliminating them.

Before we talk about the flow of goods, give me one moment to tell you how you can get even more out of this podcast. Members of the Just In Time Worldbuilding YouTube channel get free access to the worksheets on the topics we discuss in these podcasts. From the Build It In Straw tier to the Build It In Stone tier, not only do you get these worksheets, but you also get a monthly members’ livestream and early access to all my videos.

But if you don't want to commit to a monthly membership, you can also purchase these worksheets on my Ko-fi page or on my website. And if you're interested in the first season's worksheets, you can buy Worldbuilding Blueprints Volume 1, which is an epic book with a color layout and worksheets that will guide you from zero to hero, and will be available for purchase on my website from about the middle of December 2025. Links to all that down below.

And now onward to our third pillar in the economic foundation of a city: the flow of goods.

No city is an island—even the ones that literally are islands. They all rely on imports and exports to survive and prosper. Designing a fictional city's economy means figuring out what goods flow in and out, and why.

Most cities have one or a few economic strengths—products or services they produce efficiently, which they trade for everything else. In worldbuilding, you can simplify by giving each city a primary export or specialty based on its geography and culture.

For example, one city might be famous for its wine due to ideal vineyards; another for high-quality steel from local iron and skilled smiths; another for textiles from abundant wool. The idea is similar to real medieval cities. For example, Bruges was known for cloth. Damascus was known for swords. Nuremberg was known for fine metalwork, and so on.

Each city can still produce some or most of the basics for itself, but its surplus and fame come from that primary export.

Some examples of city profiles with exports might be:

An agricultural hub—Wheat City—located by a fertile river delta with annual floods enriching the soil. It would export grain in huge quantities far beyond its own needs, feeding other regions, and it would likely import tools, salt, and luxury goods.

Another example could be a pastoral livestock center—Horse City or Cattle City. Yes, I was extremely creative in naming these examples. Bite me. Anyway. Situated on wide grasslands perfect for grazing, this city would specialize in breeding horses or cattle or other domesticated beasts. It would export not just the livestock but also hides or dairy or other products made from the animals. And it would import grain and manufactured wares. Culturally, this could be a proud rancher-dominated town with huge stockyards or annual horse fairs.

You could also have a resource boomtown like Silver City or Marble City, built near unique mineral resources—maybe the only rich iron mine in the region, or maybe a dragon-bone graveyard for magical reagents used in your magic system. And the export wouldn’t just be the raw resources, because there is more value in exporting processed goods. So they would almost certainly move from just raw resource exports to exporting processed goods.

And lastly, you might want to think about a manufacturing center, where you have a city known for its guild artisans. Such a city would import raw materials and export finished products, and it would have a particular weakness to its supply being interrupted. For example, a cloth-making city might import wool from pastoral towns like the cattle town and dye from another town, and then export luxury tapestries and garments. But if the town from which it imports cattle experiences a sickness among its cattle, then the crafters from the crafting town experience an economic disaster as well.

And of course, some cities thrive by being middlemen. They re-export goods rather than producing them. This often happens if your city is sitting at a crossroads or at a port that connects different regions so that it imports goods from far away—like spices and silks—and then sends them on, skimming profit at each step. Venice historically exemplified this. It became the point of entry for a huge quantity of goods from all the known world into Europe, importing luxuries from Asia and Africa and distributing them across Europe for profit.

So for your city, consider what it exports. How are those exported goods produced? Where are they exported to? Who controls the economic activity of producing the goods and also exporting the goods? Are there any licenses required for production or export? And can those goods legally be used inside the city? Because sometimes a city that exports a lot will prevent the use of that good inside its own city.

Okay, exports are the fun part—the get-rich part of goods flow. But a city can't only rely on exports. A city's imports are basically everything it cannot produce itself, and that can be a lot. Even pre-modern cities, even the wealthy ones, needed to import food if their population outgrew local farms. For example, Constantinople in its heyday imported grain from Egypt and the Black Sea to feed its populace, just as Rome did before its fall.

So, identify your city's weak points or needs. A mining city in the mountains will import almost all its grain and wood. A dense metropolis will import building materials once local sources are depleted. A small trade port might import even basic manufactured items if it focuses only on being a trade broker and doesn't have any advanced crafters.

In a fantasy context, also consider your magical imports and exports. Does the city import spell scrolls or dragon blood from distant lands? Does it export enchanted weapons or rare potion ingredients found only locally? For instance, a desert city might export incense or mystical resins harvested from desert plants while importing water via aqueduct or magic. Or a northern city might export ice or furs and import spices and medicine.

Also think about how these goods reach the city. Is the import limited by quotas or tariffs? And how are the goods transported?

In addition to defining the import and export, also consider your trade balance. This is actually quite a fun exercise. Take all of your cities and map out on a simple table what each major city in your world gives and gets. This will also highlight why they need each other, which fosters alliances or rivalries between your cities.

A very specialized economy makes a city rich but vulnerable. For example, if Wine City depends entirely on selling wine and a blight kills the vineyards, its economy crashes. On the other hand, if the wine is truly prized, the city could wield outsized influence. Maybe it holds the secret to a legendary enchantment that makes the wine confer long life, so kings everywhere must trade with them.

Also think about how cities can band together in trade leagues, like the historical Hanseatic League of Northern European cities, to secure safe trade routes and negotiate as a group. If your world has multiple trade hubs, consider if they're rivals or partners. A very powerful trade city like Venice might operate almost like an empire through commerce, establishing colonies or exclusive trade rights abroad. Meanwhile, a less powerful city might have to ally with others or pay duties to use trade routes.

Also think about trade route security. Are roads infested with bandits or well-patrolled? A city might invest a lot in keeping the path to its door safe, hiring mercenaries to guard caravans or funding a chain of forts along the road. If they don't, trade might suffer or shippers might take alternate routes. In a story, a sudden threat to a major trade road—for example, a marauding monster or a hostile army—can send the city's economy into panic, and the city leaders might hire adventurers to address the problem post haste.

So those are the three pillars that define your city's economic activity—what makes it go. But they're not all your economy needs. So next, let's address the unsung hero of urban prosperity: infrastructure.

No city thrives without infrastructure—the physical or magical systems that move goods, people, and resources. So when building your city, consider how your geography and infrastructure support commerce. You should consider the following points:

First, transportation routes. What roads, rivers, or portals connect the city to other cities? Cities on major rivers or coasts have a built-in trade highway. Water transport was historically far cheaper and more efficient than land. A port city will need docks, piers, and shipyards. A river city might have bridges and quays. If your city is inland, high roads or caravan trails are its lifelines, and you'll see main gates on those roads with customs houses and inns for incoming traders.

Two, consider internal roads and markets inside the city. How are goods moved from the gates or the ports to the markets? Think about main thoroughfares wide enough for wagons, possibly paved or magically reinforced to handle heavy traffic. Ancient cities often had narrow winding streets except for a few key avenues for the processions of trade carts. In a planned city, you might design a grand boulevard from the harbor to the central market lined with merchant shops, which is great for impressing newcomers and sets an amazing scene for grand parades or riots.

Also consider your defensive infrastructure. City walls and fortifications also impact economic structure. Early on, a city might be confined within its walls. As the population grows, markets and suburbs form outside until new walls are built around those as well. I did this with Sefea in the Sangwheel Chronicles. These expansion stages can create distinct old-city versus new-city dynamics economically. Inside the walls, space is at a premium with expensive rents, tall narrow buildings, and high-density workshops. Outside, land is cheaper but riskier. And often poorer folk or dirty industries like tanneries and slaughterhouses are pushed outside into extramural districts. Story-wise, that's why slums or workshops often cluster just beyond the city gates in many settings.

Then we come to a really big important one: water supply and sanitation. Businesses need water. Industry produces waste that must be disposed of. How are these needs met? Does the city have aqueducts, wells, canals? A city built on a river has an advantage for water and waste, but it needs to manage flooding. Or a city with magical plumbing or summoned water might support more people, but it is also open to control by some kind of water-mage guild that literally owns the taps.

Waste product management and water management are two of the most critical parts of your economic infrastructure. It is worth staring at your city map when you put down an industry to say: how is waste being transported away from here, and how is water coming to this location?

You also should consider storage production and facilities. Here you need to think about warehouses, granaries, workshops. Where are goods stored versus where are they manufactured? In many pre-industrial cities, the noisy or smelly industries were separated from the residential areas. For example, the tanners and the mills and the slaughterhouses. So, does your city have a designated trade depot or warehouse district near the docks where finished goods are stored? Or think about having a state-owned granary that buys up grain to stabilize food prices, which was a very common practice in Bronze Age cities. If so, such a granary could become an economic power center controlling food supply, and it would be a ripe target for thieves or rebels in a story.

And then the last thing you should think about in terms of your economic infrastructure is transit and class. The quality of infrastructure often reflects social hierarchy. If a city has effective public transportation—say, a network of horse-drawn trams or teleportation circles—it allows even poorer folk to live farther away from their workplaces. But if it doesn't, the poor must live near their jobs—they must be packed in and squished in near their jobs—while the rich can afford long commutes or secondary homes. Thus, in a fantasy city with no cheap transit, your dock workers and factory laborers will crowd the harbor tenements, whereas wealthy merchants might maintain estates in cleaner outskirts unless social status demands that they live near the core of the city.

And don't forget that this is fantasy worldbuilding. Magical travel like teleportation portals or flying or magical ships and so on can supercharge both trade and internal transit by making it faster and safer—although it typically raises the cost or limits the capacity. If only elite wizards teleport goods, they might specialize in high-value, low-bulk items. Teleporting a chest of gems is worth the cost. Teleporting a ton of wheat is not. Thus, mundane trade routes can still exist for bulk staples or poor-people goods.

However, if a city sits on a permanent portal linked to another continent, it could have a flourishing trade hub beyond any traditional city in our world—or it could become very, very dependent on that portal’s stability. Stories could involve what happens when the portal network crashes or falls into enemy hands, cutting off vital imports.

Our last critical element to remember in designing your city's economy is governance and regulations. A full definition of city governance will be the topic of a future podcast, but it's important to cover a few aspects now to understand its impact on the city's economic life.

A city's government—whether it's a king, a council, a guild consortium, or a god-touched oracle—creates the rules of the economic game. These rules determine who gets rich, who stays poor, and what parts of the economy rise or fall.

Every city has mechanisms of control, even very loose or decentralized cities. These affect licensing—who is allowed to work or produce goods; taxation—who pays for what services; regulation—what is legal versus what is restricted; ownership—who owns land, workshops, water, and magical resources; and corruption—who ignores the rules, and why they get to do that.

So for your city, consider: who controls the economic activity, and how do they control it?

As part of this, it is worth considering the impact of guilds. Guilds in a pre-industrial city often define professions. They set standards, but also restrictions. A guild is basically a coalition of masters and sometimes journeymen in a trade, often formally recognized by city authorities. Historically, guilds were associations of merchants or craftsmen that controlled trade in a product, setting prices, quality standards, and training apprentices.

In your city, virtually every major trade might have a guild. You could have a merchants' guild that oversees general commerce, perhaps running the major market and arbitrating trade disputes. You could have specific craft guilds like a weavers' guild, a blacksmiths' guild, a masons' guild, and so on—each monopolizing their craft in the city.

In a fantasy twist, you could have guilds for magical professions too—like an alchemists' guild, a healers' guild, a mages' guild. Guilds might even transcend one city. For example, you could have a continental mages’ guild with local chapters that coordinate arcane services.

Guilds will impact the economy by potentially limiting competition and fixing prices for their own benefit. They can maintain high quality—no shoddy smiths in town because the guild standards forbid it, which is good for consumers up to a point—but they probably also keep prices artificially high and exclude upstart craftsmen, which widens the wealth gap.

This dual nature of guilds is amazing for story tension. For example, you could have a glassblowers’ guild that keeps a tight grip on making glass artifacts. So when a talented outsider arrives with a new technique, guild masters might try to buy him off or sabotage him to protect their monopoly. Or guild rivalries could spill into open conflict—the shipwrights versus the sailors, or the brewers versus the innkeepers over beer prices.

So in your city, think about which guilds exist and which are most powerful. Typically, luxury and high-skill crafts like goldsmiths and armorers had prestigious guilds, and broad necessity trades—bakers and butchers—also formed influential guilds because everyone needed their goods daily. A merchants’ guild could be extremely powerful, since it might regulate trade with other regions and control the marketplaces.

In a fantasy world, a mages’ guild or alchemists’ guild might hold special authority if magic is economically important. So, for your city, what guilds do you have and how do they impact your city's governance?

And that is my thoughts on how to really bed down your city's economy. Next time, we will be discussing that all-important city governance and its impact on city life. So make sure you subscribe for that.

And a huge thank you to my channel members who make this possible, especially to the members of the Build It in Stone level: ep_ic, Jeff Hicks, Laurabones 79, A. Wellyard, NecromancerJm, Neil Buckley, Katie KofeMug, and Tony LaManna, as well as the members of the Build It in Wood tier: husoyo, fallowrpg, Patricio, Ignacio Rascovan, Moxain, Jackmeowmeow Meow, Joaquin Moreira, Nicholas Ammann, BearNecessities, Michelle Fleck, Glacier Maniac, Carrie , Aya Shameimaru, and Tiffiny Felix. Without your support, this wouldn’t be possible.

And I will see you soon for another episode of Worldbuilding Blueprints. Remember: build what you need, when you need it.