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What is money? A common person's view of money is rather static and limited. If looked at it holistically it can be detected that there is not one perspective on money, but several that intertwine.
Money is generally understood as a noun. However, it makes more sense to interpret money as an adjective. For in the history of mankind, money has never been constant but has always been a complex social phenomenon of human interaction. From a historical perspective, four views of money can be distinguished: the religious, the communitarian, the statist and the societal one.
Any view of money can be "corroborated" with historical examples, but none is the only true narrative. The best way to illustrate this is to look at various illustrations on the most common form of money, the coin:-The number refers to the conventional setting of a value by the community, pointing to the communitarian view -The head, however, would stand for authorities, which lend value to the coin according to the statist view -The societal view stresses the handshake as a market agreement based on mutual agreement -The tripod as an altar of sacrifice ultimately underpins the religious view and its connection with money
For the representatives of Chartalism, money is ultimately a mere sign. The setting by a ruler, state or community defines a "charter", whose Latin translation means brand or symbol. For the communitarian view, money is a status symbol, a phenomenon of an economy of donations or results as the original debt to the clan.The concept of guilt is also decisive for some chartalist interpretations. At the origin of the statist view is the tax as debt, which gives money its value.The first two perspectives are possibly preceded by the religious view, which sees the relevant debt as a sacrificial debt to the gods.
In the clan community, the use of money is usually unnecessary. Due to a high degree of homogeneity and a fixed hierarchical structure, money is first and foremost a symbolic money and status symbol as well as a form of expression of a gift economy. If the bearer or essence of money is lost, money continues to exist as a sign without substance. This is what happened, for example, with money-like rai stones that were sunk into the sea, but nevertheless retained their status as clan and status money.Read More
From this perspective, money is set by the state and thus a creature of the legal system. The tax debt set by the state forces the state's citizens to pay taxes and thus gives money its value. The solidus, a Roman coin, can illustrate this connection:In order to supply the armies, the Roman Empire demanded tribute payments, which were to be paid in state coinage. At the same time, the soldiers received their payment in this very money. In order to secure the need for coins to pay taxes, the population was forced to provide food to the soldiers in return for the solidus.
According to this perspective, money has emerged from the cult of sacrifice. The sacrifice to the gods is called "Gelt" in Old High German.In the beginning, the sacrifice was made in the form of natural produce. Above all the cattle stand out in this context. Still today the cattle testifies as a holy animal of it and also the Indian rupee is derived from the word for cattle.With time, the sacrifice was no longer performed in kind. With the transition from real sacrifice to a symbol, the emergence of "chartal" money became prevalent. The deity as a purely spiritual being suffices the dematerialized offerings. The tripod, an altar of sacrifice, testifies to this transition.
The term "catallactic" comes from Greek and means "exchange" or also to make someone "from an enemy into a friend". A catallactic approach, therefore, focuses on the spontaneous actions of people and their voluntary interaction with each other. The creation of money is understood as an emergent, spontaneous phenomenon.
The societal view sees money as having arisen from spontaneous exchange among strangers. Dealing with strangers one can rely less on social norms and sanctions that can still be enforced in a clan community. In the exchange with a stranger, as is customary in a society, a value carrier that is as universal and anonymous as possible is needed to bridge this vacuum of trust.Interestingly, among strangers, certain goods are more easily exchangeable than others. The reason for this is that the objective properties of certain goods are intersubjectively assessed as more marketable and are therefore better suited as universal, anonymous value carriers.
According to the societal view, money is by definition the most marketable commodity of all. The high marketability is the result of the following characteristics:-Transportability -Divisibility -Durability -Uniformity -Scarcity
The spontaneous process consists of a process of discovering which good has the highest marketability. As history proves, precious metals have proven to be a marketable commodity in a special way. Once the marketability has been discovered, there are convergence or network effects which constantly increase the marketability. From this perspective, money is therefore also to be understood as a network effect good.
As the various historically based monetary perspectives show: Depending on one's view of money, one comes to different normative conclusions about what money is or should be.But today, one money or one view does not dominate. Today's money is ultimately the synthesis of three perspectives. In our secularized world, the statist view has completely absorbed the religious one. In combination with the societal view, money has become a means of controlling and "staging" community. In this respect, money increasingly resembles the idea of the communitarian perspective.The blind spot of the monetary perspective is ultimately the following: under cost (money creation and state setting), states today maintain national currencies that serve to maintain fictitious big clans (of these very states). Seen through the lens of social vision, however, these costs are less conspicuous.
Knowing the history of money is important to understand our money today. It all started with communitarian "money" within tribes, followed by coins produced out of precious metals and later private banknotes that finally turned into officially enacted national currencies.