A major game mechanic I've often thought about and analyzed is the disadvantage system. This is a complex subject, so I’ll start with some introductory analysis. The classic disadvantage system is that of Champions/Hero system, so I'll use that as my reference system. Role-playing game systems tend to have so many variations between different games that it is difficult to make any statement or use any terminology that is true across all games, so I think it is most practical to take one classic system as a reference model about which comments can be made that are true about many games, then describe the many variations at a later time.
What is a disadvantage system? When making a role-playing character in almost any system, you can make choices that determine how strong your character is in various categories, and you can make choices that grant your character extra advantages or abilities. In a point system like Champions, you pay for these extra abilities. In a system with disadvantages, you can make choices that are disadvantageous for your character, and you can get points back to spend on other things. These disadvantages can take many forms as listed in the individual system; examples include “one-eyed”, “wanted by police”, “won’t kill animals”, “unlucky”, or “afraid of spiders”.
In games without formal systems for disadvantages, some players will usually take some equivalent of disadvantages for their characters. This is particularly true of players who really like role playing. The player may decide that the character is obsessed with avenging her husband's murder, for instance. Or a whimsical player may decide that his dwarf drinks too much and smells bad. After all, the purpose of a role-playing game is to have fun, and making your character more complex and interesting can be a lot of fun. Other players, however, may be more interested in other aspects of the game and less interested in designing personality and back story, or they may have a very specific character design which is not particularly disadvantageous – perhaps a laid-back elven noble with an elaborate series of political connections. But whatever they choose, it has no impact on the formal character design and doesn't involve use of game rules.
An actual disadvantage system formalizes this process and assign some sort of value to each disadvantage. My analysis is that a disadvantage system has two distinct goals.
The first goal of a disadvantage system is to make characters more interesting by encouraging them to take characters with dramatic flaws as well as dramatic strengths, or by simply encouraging them to think a lot more about the personality and background of their character, creating more interesting facets of the character and more things for the game master to hook stories off of. Certainly this is very evident when comparing a bare-bones Champions character (one where the player builds the character according to the rules but doesn't add any optional written description) with a bare-bones D&D character. The D&D character has practically nothing on the sheet that indicates personality, except perhaps for some idea of the combat and noncombat styles and whatever stereotypes you might expect from their race, class, and statistics. With a Champions character, on the other hand, you can usually glean a lot about their major role-playing elements just by looking at the list of disadvantages. Of course, in D&D it is recommended that you write up a detailed back story, but many players don't do so. And even if they do so, the character may not have many really tangible flaws or problems that would make adventures more dramatic. And a disadvantage system not only encourages creating character flaws and hooks, it provides a standard structure for doing so, and a very helpful list of examples.
The second goal of a disadvantage system is to fairly compensate characters who put flaws into their character conception. If characters have to pay points for having positive attributes, it is only fair that they receive points back for having negative attributes. This is particularly true when you consider that, in many cases, not purchasing some sort of advantage that all the other characters have is equivalent to a disadvantage even in systems that don't have formal disadvantages, and you certainly are allowed to spend more points in other areas if you do so. The important point here is that most players, in addition to wanting their characters to be cool, want their characters to be effective, and are reluctant to intentionally weaken their characters in any significant way without getting something back. Receiving fair compensation for disadvantages makes players feel more free to make the character design choices they really want to make.
The second goal (compensation) may seem very similar to the first (encouragement), in the sense that the mechanism for achieving the first purpose is basically the same as for the second purpose - to compensate characters for having disadvantages. But in terms of how you analyze and craft the precise disadvantage mechanics, these are different goals. In particular, they would have different ideal end results. The ideal result of encouragement would be for every character, without exception, to have a large list of interesting disadvantages. Whereas the ideal result of compensation would say nothing about how many disadvantages the characters have - they should feel free to have many, few, or none, according to their conceptions, and know that they will be fairly compensated for the ones they picked.
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