There are a lot of lessons of good game-running that carry over between tabletop and live-action gaming. This post, though, concerns itself with an area in which the two are quite different. As usual, I'm talking about a certain band of LARPing, not all LARPing. (There are almost no statements that apply usefully to all of LARPing without being tautological.) So this is about games with a campaign-style structure: characters continue from event to event, accruing both Abilities and Stuff. (Characters also accrue less-tangible things, like Plot Relevance and contacts, that are major advantages in the game - anyway.) Be warned, this post is going to rehash a lot of basic concepts.
The thing about Stuff is that it is separate from Abilities. Abilities (the things that are intrinsic and inseparable from the character, purchased with experience points) increase over time, and generally someone who is ahead is always going to be ahead, though a newer character can catch up with a longer-term one by specializing (if and when the other generalizes), can close the gap (either because skills grow more expensive or because experience point income decreases - the former model is common in CI/Ro3, while the latter model is found in NERO and its family of games), can go to additional effort to catch up (depending on circumstance), or can arrange things so that the other player has to miss out on opportunities for experience points (don't ever do this - it makes you an asshole and possibly a criminal). This isn't a post about comparative experience-point mechanics, and I'm not interested in arguing relative virtues of these models right this moment. The important point is that for the most part if A has more experience points than B early on, that will remain true later, and experience points are for most games the best interdisciplinary measure of power.
So this brings us to Stuff. In the fantasy genre, most of the Stuff we care about is reasonably described as Magic Items, though some settings have highly valuable nonmagical commodities as well. In this case I'm not interested in currencies or trade goods - those are things you might use to acquire relevant Stuff, not Stuff in themselves. (I'll get some real terminology in a minute, don't worry.) In settings without magic, there's still usually some kind of Stuff to gain in the course of play, if only because it's so satisfying to upgrade one's gear and get cool new toys. These are typically better than whatever the baseline starting gear is - or they're providing things completely unknown to normal gear. So from here on out I'm going to call them magic items rather than Stuff - but you steampunk, western, and sf folks just keep in mind, I'm talking about your Uber Death Rays or your wacky new steam-powered cybernetics.
So the general purpose of magic items, in both LARPs and tabletop games, is to grant a new and tangible benefit to the user. Magic items might reasonably be rewards for one's efforts, available through purchase, the source of the story and conflict in themselves, or all of the above. If a character's experience point total is an objective measure of power, magic items are boosts to that total - albeit ones that may come with drawbacks or the possibility of loss. Quantifying that increase in power is sometimes unclear, but that's not particularly important; cursed magic items that have no benefit, or represent a net loss in power, are pretty rare. More on this in a bit.
In most tabletop games, the GM and the players probably make an effort to evenly distribute magic items, both because it supports the fun of all party members and because (in games with lots of magic items, like 3.x and 4e D&D) it's generally optimal play to do so. But then, most tabletop games also keep characters close together in experience point totals as well - old-school D&D being a notable exception. LARPs mostly don't - characters entering the game two years down the line have substantially fewer experience points. They also haven't had a chance to gain any magic items, so they don't have whatever variable amount of power the long-term characters have gained from them.
PCs do sometimes hand magic items down to less-experienced characters, often keeping them within a team; the permanent death or retirement of a more-experienced character prompts inheritance of magic items. As an objective benefit to the game's story, if the magic item changing hands is attached to a significant piece of story, it enriches the magic item's story - something that players will enjoy relating to one another at any opportunity. It's content that they, and people they mutually knew, experienced personally, so it's the best kind of lore.
Story Is Everything
The most important advice I can give about magic items in LARPs is the same as advice given in tabletop games: make sure every magic item has a story behind it. Avoid bringing a +1 widget into the game, unless it's a low-powered consumable item. (Not every healing potion needs a backstory, though I doff my hat to those who do attach a story to them.) High-end single-use items probably should have at least some kind of story, but I'll come back to this.
The exception to this is player-created magic items. For example, Dust to Dust has Forge Magic, which creates enchantments that last as six events (generally a little over a year of gameplay). Eclipse, likewise, has some pretty badass high-end gear, like weapons that deliver three charged attacks per battle. What's going on in-play is the transformation of a plain steel sword (or whatever) into a pretty potent item. We've hooked all the story into the process that we can, with the text attached to Forge Magic spells and the rather opaque implied structure of the mystic materials used. On the other hand, it's explicitly written into the setting that when the item gains a story through participation in a Great Deed (a concept that is itself deliberately opaque), it can benefit from being Named, and becomes better somehow.
I mentioned low-end single-use items as things that don't really require a story - their use won't be particularly memorable, so their background doesn't need to be either. In Dust to Dust and Eclipse - and indeed in most games - players can create a wide variety of consumables, covering a wide variety of the games' Effect Lists. These form the core of the economies and essential parts of encounter-by-encounter gameplay - they factor into the expected power level of the characters that create and use them so completely that they are more like Abilities than Stuff.
Then there are the really high-end or unusual consumable items. One of the best stories of this kind of thing comes from Shattered Isles. In the penultimate event of the first campaign, Heather received a one-shot magic item from an NPC, with the power to dispel a purity barrier (a particularly fiendish kind of wall or circle frequently used by our enemies). Purity barriers had been screwing us over for at least a full season before that, maybe two, and other than that one item we had no answer for them at all. Heather didn't wind up using the item in the arc closer - for whatever reason it never quite became necessary, if Plot had intended for it to be. She hung onto it for a full year, into the second or third event of the second arc. There was a field battle that revolved around a purity barrier, in which we needed a way to interfere with whatever bad things (probably human sacrifice) the bad guys were doing inside the circle. This gave every sign of being a bitterly-fought, angsty field battle. Then Heather waltzed up to the purity barrier, activated the dispel, and earned a few curse words from the campaign director (who was, fortunately, near at hand to marshal the situation). In the intervening year, the existence of this item had slipped Plot's collective mind, and as a result a PC had just the right incredibly niche solution to a problem that had no other solution.
Digression: The moral of this story, in my view, is not that SI Plot did anything wrong at any step of this process. No matter how it got used, the ability to dispel a purity barrier would have derailed any encounter. Colorful language aside, the director did an admirable job of rolling with the player's action gracefully. If your game includes one-shot items with enough power to negate a major threat, their use is memorable enough to be a story - so make their creation or acquisition be an interesting story.
The other thing to consider about single-use or times-ever items is that if players can't readily replace them, most players won't spend them. Unless they have no other solution, many players say to themselves that they're saving this item for a really desperate time. I don't know about you, but I do this compulsively in video games, and I'm no better about it in LARPs or tabletop games. Plot committees and GMs gradually forget about them, which is good - the joy of using those big game-changing items is that the situation wasn't planned around their use. This emergent narrative maximizes the feeling of player agency. If Plot had said to themselves all along that this was the only solution, it's more like a key and a keyhole than a moment of heroic cunning. I don't think there's a player yet born who doesn't feel cool with a utility belt full of weird solutions to obscure problems... and then having those solutions work.
Per-Event or Per-Day Items
Items that recharge themselves are, of course, quite desirable. If a trick is fun once, it will be fun twice, right? Maybe every event for the rest of time, if not more often than that? Of course this dilutes the feeling of uniqueness found in single-use items, so these items grant a different kind of fun. These items get used often enough to become a memorable part of the character's style. Now, this is hardly a new idea: 4e D&D explicitly encourages this kind of image-crafting. Depending on how much power and relative rarity the daily effect has, it can easily fall prey to player parsimony. On the other hand, maybe it winds up working more like a 4e player using a daily power: completely unused until the boss shows up, then every player dumps daily powers into the boss as fast as possible. Whether you call it alpha-striking or going nova, players love to do this: what else shows off their coolness more than doing a ton of damage to the big bad, maybe even acing him?
Tabletop designers and bloggers spend a ton of time working on how to solve this; I don't know that LARP design has worried about it nearly as much. Ro3 games tend to put some kind of limit on the proliferation of these items; in the case of Dust to Dust, a lot of Forge Magic items are daily-use, and their practical limit is cost. The one universal piece of game-running advice applies here, though: don't get attached to a scene going one particular way or an antagonist presenting a certain amount of threat. If you want to make the gods of gaming laugh, tell them your plans, and your players will generously supply you with chaos. It's what they do!
At least one of my readers has taken the position in conversation that daily powers of all kinds should get cut, to be replaced with powers that can be reused after a delay or after a particular player action. This might work, and it helps that the idea as expressed to me focuses on additional player interactions, but if the player action to recharge the power takes longer than the time to use the power in the first place, it's possible to wind up on an awkward-yet-obligatory treadmill of use-reset-repeat. The more helpful-to-others the power in question is, the more obliged (especially through social pressure) the characters are to repeat that interaction. Coding in a chance for catastrophic failure might solve the problem; I can't foresee quite that far. Player psychology gets very antsy about things that are only sometimes a good idea, determined by risk analysis - and player risk analysis is necessarily dodgy.
The next step up the frequency ladder is items that reset on the same timer as a character's combat abilities. If the effect of using such an item is kept pretty low, these might be the most like just having a boost in experience points - Plot and players alike are better off not putting anything complicated on a per-encounter timer, because otherwise every NPC on site gets to hear that briefing at least twice an event as they blink in confusion at the player. (If you're doing something slightly-left-of-normal that still uses the standard Effect List, carry on... but keep it tame in overall power, because someone might use it twenty or more times in a day in some cases.)
One of the most notable cases of per-encounter items in Ro3 was the radically game-changing introduction of battle foci in King's Gate's second arc. Up to that point, there were (almost) no ways to regain mana within a single day: you had what you had, and that's it. In Eclipse, battle foci became Abilities rather than Stuff, but in KG they were still rare and special (this might be wrong: I wasn't actually a wizard, I only know what I got through the grapevine). Anyway, battle foci made a portion of the wizard's mana refresh with out-of-combat rest, but only if they used their school's primary attack spells. Also, it wasn't enough mana to let the wizard just light up everything on the field and expect to get it all back. Battle foci are an example of a magic item that was not unique (by the end of the campaign several PCs had them), and radically alter gameplay for those who had them.
Digression: This brings up the idea of other kinds of altering gameplay. In Path of Exile, there are items and skills that the player can pick up that completely turn gameplay on its ear - such as removing all of one core stat and replacing it with something else, or reducing all of one kind of damage to hugely magnify other flavors of damage. This approach to design makes my head hurt because the choices are so hard to understand (that is, the game's learning curve looks more like a brick wall). On the other hand, I appreciate how daring it is, and if I were less concerned about ruining a player's fun when a Weird Option got out of hand (and the whole point in Path of Exile is for them to get out of hand), I'd want to explore more of that design territory. This is probably something Stands-in-Fire would design a lot better than I would, though.
At-Will or Passive Items
CI/Ro3's approach to granularity doesn't play well with passive bonuses, as a general rule, and a broad expectation of attrition doesn't play all that well with at-will effects any greater than a weapon-swing. Most of the game's at-will effects are Abilities, or fall into a gray area between Abilities and Stuff - spell formulas. A very small number of ritual formulas cost no Fatigue, and so you could cast them all day long... they're just the kind of effect that means you have little incentive to do so. I think there are items I'd have to classify as at-will or passive that I'm overlooking, but all that is coming to mind right now are things that grant Advantages, an item in Shattered Isles that granted Stabilize (the lowest-end healing in the game) as an at-will effect, and a few different things that cause a suit of armor to grant an additional point of protection. (Armor value doesn't fit the at-will/encounter/daily paradigm all that well, because of how CI/Ro3 handles armor; you'd really have to call it passive.)
The math paradigm of CI/Ro3 is far from universal - there are plenty of LARPs out there in which players normally deal double-digit damage with a weapon swing, and have combined hit point and armor values comfortably into three digits, to say nothing of what the NPCs that are expected to go toe-to-toe with them have. Correspondingly, my comments here don't apply, but my lack of direct experience with those games also means I don't have as much advice to offer them. They (consciously) resemble D&D rather more, and in D&D (especially 3.x and 4e) magic items became not Rare and Special but a default math-correcting assumption. There are a lot of worthy discussions to be had about whether this is good, but I'll say that I don't favor it in LARPing. I prefer for magic items to be rarer and more special in LARPs, because once they're a default assumption, they're another barrier to participation for new players, and another distinction between the social insiders and outsiders.
Exceptions-Based Items, and Stuff That Is Abilities
These are, I guess, a subcategory of passive items - but the thing they passively do is change how your character intersects with the rules, kind of like I was talking about in the Path of Exile digression above, but usually to a lesser degree. It's another area where the divide between Abilities and Stuff becomes messy, because we might be talking about Lost Arts that a character got to learn as a reward. Also, they do elevate the experienced player above the new player to a greater degree, though sometimes it's more of a lateral move.
For example, my Eclipse character has two cybernetic modules that explicitly break the standard rules. Normally, a cyborg can't have both the stealth line of modules and the perception line of modules, but we were mucking around in some ancient ruins and we found a top-end perception module that both did not require the normal prerequisites and did not conflict with my existing stealth modules. In addition to being a sometimes-game-changing ability in its own right, it also breaks the opportunity-cost design of cybernetics. Unlike most magic items, it is installed in my character's body, so it can't readily be removed short of major surgery. What it can do (but hasn't yet) is go horrendously awry with an unforeseen complication. I didn't earn the item according to the typical paradigm, so as far as I'm concerned it can change or reveal "undocumented features" whenever Plot feels so inclined, without infringing on any part of the game's social contract.
The other item is similarly exceptions-based. Normally, a character can't fire a machine gun without a fixed-point support. This tends to make them hugely undesirable weapons (despite having the Pierce Threshold ability on every shot), and Plot likes it that way, because a fully-automatic weapon with a 30+ round clip is not a fun time for NPCs attacking us. My character, however, has a weird cybernetic leg module that he inherited from an NPC (eww) that grants him the physical stability to fire such a weapon on the move. It happens that NERF's gun models for machine guns are pretty unreliable, but when they work I'm incredibly unfair to fight because of the exception I represent within the rules. The leg module has other effects also, but this is the really flashy part.
The benefit of each of these magic items is technically always-active (changing a No to a Yes within the rules), though I don't actively experience their benefit 100% of the time - that is, I spend most of each event not firing a machine gun or detecting invisible things. The downside of these exceptions is that they can generate confusion among other players: if you haven't heard about how or why they work, you either think I know something about the rules that you don't (and thus you can do the same thing I can), or you think I'm a big ol' cheaterface. The broader problem with exceptions-based design in magic items is that, to a greater degree than other kinds of items, they set their users apart from the hoi polloi. It feels great for the user, but it emphasizes the sense of unattainability for those without. To make this feel fair, Plot then has to give every player their own personal exception. This is not so bad in a tabletop game, where the GM is in constant contact with all players, but in a LARP it represents a more convoluted burden of content creation and balancing. The point here is that there's nothing wrong with this approach, as long as you understand that these kinds of magic items are more complicated than "standard" use-based items.
Then there are Skills-as-Rewards. This is Personal Mechanical Plot at its finest: the quest and training montage to learn the secret martial arts, secret spell, or whatever. If these cost experience points (and they really should, if they don't carry some other drawback), they are less of a pure boost to a character's relative power. 2nd Dawn has an interesting twist on this: the first time you learn any Lost Art, it only sticks around for a limited amount of time before you have to go learn it again. Since I don't play 2nd Dawn, I don't know a whole lot about the deeper theory and implementation behind this - 2nd Dawn folks who read this, I'm curious to hear more about what goes on here. The evident benefit is that you get only a temporary Fun Thing as your reward; the evident drawback is that once someone has a taste of the Fun Thing, there might be an increased expectation that Plot will let them regain it, creating a demand for personal content on a particular timeline. Maybe this is a non-issue for reasons I don't see? For example, if the teaching NPC is a bit shady and you wouldn't otherwise want to work with them (but they're regularly available in-play anyway) then the NPC suddenly has hooks in the PC, and I naturally admire that. I'd be curious to explore this concept in a tabletop environment, where the content-creation dynamic is a little more forgiving.
Now For the Bad Stuff
One of the quickest ways to turn a magic item into a nuanced, challenging choice is to give it some flaws. This is right up there with the oldest tricks in the book - you may have heard the one about that one ring of invisibility that proved to have some tricky drawbacks like being incredibly fucking evil. I could write a whole post on magic items with curses and drawbacks, and how the social dynamics of LARPs are utterly unlike the social dynamics of a tabletop game due to tribalism. It's super tricky, for all of the reasons I discussed here. Additionally, if the magic item is external and transferable, players frequently want to toss the cursed widget in a vault somewhere to prevent it from doing whatever dangerous thing it wants to do. Rational, sure - but it also exacerbates some of the insider/outsider social divide. The more the item's drawback potentially splashes onto other players, the more likely this is to happen. Even if it's fun content for the players, characters still pursue what they see as rational best outcomes. A clear path toward resolving the item's drawbacks does a lot to mitigate this reflex.
I don't have all the secrets to designing fun drawbacks, unfortunately. I don't know that there are any blanket-applicable rules. Pay the closest possible attention to tone, when presenting content to players: their paranoia is useful, as long it's moderated by a belief that engaging with content and exploring the setting will do them more good than harm. If it's a simple, obvious choice that they shouldn't use something, then make sure that's what you meant it to look like - but as a general rule, complicated choices create more interesting content than obvious choices. This area of design is identical between tabletop gaming and LARPing, though D&D tends toward diluting those choices with obviously-better options.
Just as a more powerful item needs more story attached to it, the most powerful items should probably carry the most interesting drawbacks. This is a direct translation of D&D: artifacts, folks, look 'em up. Just... do yourself a favor and look for benefits that the artifact can offer other than bigger pluses.
The One Other Thing
The weird thing about magic items in a lot of LARPs, though not all, is that the rules are designed without the context of a single magic item. They are literally an afterthought. The rules stop at establishing what "normal" means. If the Plot Committee and the Rules Committee are separate entities, magic items are one of the areas where weird things start to happen. Since Rules typically wouldn't be consulted about the new magic item that Plot introduces, Rules has to sit there and watch Plot's new widget upset their delicately-balanced rules. This only really happens in a tabletop game when a player has a greater command of the rules and attachment to their function as-written than the GM does, and the GM starts introducing things that clash with the game's core design. From a Rule-Zero point of view, Plot/the GM cannot be wrong. They are responsible for the outcomes, though, and if they failed to foresee consequences, that can create a significant problem. The same thing happens with monster design, another area of the game that most player-run Rules Committees wouldn't touch. In my experience, Plot Committees and GMs can't escape having to do some design work in addition to content creation.
Okay, I think I've covered everything I wanted to say about magic items in LARPs, and how magic item design in campaign-length LARPs differs from tabletop gaming. Comments welcome!