3 ms·
"My Econ 101 understanding" Go just a bit past Econ 101, and you'll discover that economists do not universally agree on these things. That being said, here i
by betterunix 14y ago
"My Econ 101 understanding"
Go just a bit past Econ 101, and you'll discover that economists do not universally agree on these things. That being said, here is one popular view:
https://en.wikipedia.org/wiki/Modern_monetary_theory https://en.wikipedia.org/wiki/Modern_monetary_theory
From wiki:
"[Knapp] argued the state could create pure paper money and make it exchangeable by recognising it as legal tender, with the criterion for the money of a state being "that which is accepted at the public pay offices"."
Or in other words, taxes, torts, and other laws give money its value.
- chii 14y ago> Or in other words, taxes, torts, and other laws give money its value. i think legitimacy is more correct than value - value is a result of what people demand in exchange for their goods/services. Legitimacy is the trust that people have on the currency (ie, the trust that others woudl also accept the currency).