What is good about money?

Fragment of a discussion from Talk:Money
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re 1(a)(b), Morbius writes (private):

It's less that there are things which cannot work without money, but that there are exchanges which are vastly more facilitated by a money-based exchange. It's an efficiency argument. There's also the fact that money gives a uniform pricing (exchange) basis.


  • Trading of disparate goods. Apples for oranges. Bread for labour. Rent for fine art. Interest for capital. Taxes for public goods. This presupposes and enters into a few other elements. Common pricing supposes markets (multiple buyers and/or sellers), and there seem to be a number of different types of exchanges: goods or commodities, labour, rents, assets, interest, taxes, public goods. Smith's discussion of prices covers many of these, and there seems to me an underlying logic supporting much of his classification.
  • Multi-party exchanges. Much trade isn't end-user consumption but intermediate exchange. A sourcer (farmer, miner, forester, fisher, etc) acquires raw materials, sells them to an intermediate trader or transporter (there's a whole literature of "jobbers" in 19th century business here), transport shippers (teamsters, ship captains), manufacturers, wholesalers, and retailers. We tend to see the retail trade but ignore much the rest. Labour is also generally not sold to end-use consumers but to intermediate service or transport interests.
  • Money itself is highly fungible and exchangable. I'd argue, much as I do with Weber's definition of argument, that money is simply the most exchangable good, that is, the good which is in highest common demand by all. Which means that whatever good has that property is by definition money.

(By extension, money need not be some government-issued or sanctified commodity, though it of course very often is. It is always, at least within the exchange community, the currency of social convention.)

Woozle (talk)00:00, 19 July 2020