Numbers only have meaning in relation to each other. A few kinds of numerical relationships:
- identical (1:2:3:4)
- linear (2:4:6:8)
- exponential (2:4:8:16)
- triangular (1:3:6:10)
It is much easier to balance a system when you can put everything in terms of a single central resource. For example in CRPG such as Final Fantasy, everything can be put in terms of HP (gold is used to buy stuff to reduce dmg, hence increasing HP). In 2D platformers, the loss condition is lives (sometimes, it is score), and everything is tied to it.
Various loops in CRPG
XP - encounters: more encounters gets you more XP. Your level increases, and so do your stats, which in turn lets you face more encounters. The feedback loop here is not exactly positive, because as the level increases, the number of encounters needed to level up increases (non-linearly).
Equipment - encounters: Fight monsters, get gold, use it to buy better equipment, which lets you fight better monsters for even more gold and so on. This stops being a positive feedback loop at some point because there’s a limited set of equipment you can buy, and the best stuff requires you to travel to distant towns which can’t be reached from the start.
Gold - encounters: get more gold, which lets you buy keys, which lets you progress to new areas, which gets you to more dangerous and advanced encounters for more gold. Truly positive.
In RPG, the XP system serves as a negative feedback loop: higher-level players need to kill more monsters than low-level players. The designer can know quite precisely the level of the player, which makes it easy to design adequately challenging enemies. A fast leveling at the start is useful: it hooks up the player.