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Not only bartering has never been the default mean of exchange, but also the idea that money were created to optimize the trading process is also wrong. For an
by zahrevsky 15d ago
Not only bartering has never been the default mean of exchange, but also the idea that money were created to optimize the trading process is also wrong.
For an item to become currency in a society, it must already be something people value independently of its use as money, and people must expect others to accept it as well. Say the villagers live near the sea and find some beautiful shiny stones that everyone wants. Those stones can then become currency.
A good example of this is tobacco in colonial America. It came to be used as currency because it was already widely traded and valued.
- lolakutty 14d agoSo a systems using money is just barter system where one commodity is overwhelmingly involved?
- stymaar 14d agoIt's not “just” that, because monetary systems don't work like that at all. The point of GP is that while the myth says “in the beginning there was barter, and barter is inefficient so we created money to allow trading more efficiently” the reality is more “In the beginning there was trade, and some traded goods became money because they had the correct properties”.
- lolakutty 14d agoIsn't that what I just said?
- modo_mario 14d agoSalt was similarly used as a currency. It didn't expire, could be weighed, had inherent value in it's role for food preservation, etc