Money has multiple currencies (commodity or fiat). Its usage is based on a trust system where exchanges can occur in which the logic of the economy can be based either on a hierarchy of moral values or neoliberal economic theory, or perhaps a hybrid of both with different cultural weightings. All economies are complex systems. Dominating the economy is ‘general-purpose’ money founded on a universal principle that all goods and services can be measured in terms of single metric that reveals the utility of how much a consumer is willing to pay (value). Simmel, one of the earliest and most influential writers who focussed on the qualitative aspect of money, argued that an unobtainable object that is valued through desire and separated from the individual can only be overcome through purchase. Hence an individual must participate in the exchange system whereby a calculation of sorts has to be made of what has to be sacrificed i.e. labour in order to obtain it. The instrument of exchange is money because “money is the purest reification of means.” (2011: 227).
Money has become a social institution in which “money is a form of IOU that is universally trusted” (Bank of England, 2014). It is through the merit received from the public’s feedback, which instils confidence that fiat money of a certain currency is an acceptable form of payment, and creates the condition for economic activity (Douglas 2002 : 86). With the specialization of labour and an exchange economy, where trade is vital for modern day living, individuals require different things at different times. Money underpins ‘the complex web of IOUs’ whilst masking or neutralising the social relationships between communities. The underlying trust that money is worth its value is because money represents an IOU from one sector of the economy to another. The social relationships formed indirectly through money holds together the nation, and beyond, by those who invest and speculate on the stability of that nation’s currency over time to be used as a medium of exchange.
Together, markets and the circulation of ‘general-purpose’ money have the capability to extend society way beyond its local core. Markets emerge and exist where there is a need for the distribution of scarce goods and services. If they were not scarce people would not have to work for it. Hence, this depends on the livelihood of the individual or the community i.e. are they living within a self-sufficient community where the majority are working in some form of agricultural work or do the individuals do specialised labour and hence depend on the market to supply the goods whilst they focus their efforts else where. The market itself does not discriminate against what can be purchased. As Michael Sandel argues “markets reflect and promote certain norms, certain ways of valuing the goods they exchange. In deciding whether to commodify a good, we must therefore consider more than efficiency and distributive justice. We must also ask whether market norms will crowd out non-market norms, and if so, whether this represents a loss worth caring about.” (2012: 78).
Essentially the market is a blank slate on which individuals identify and determine what is most important to them, however the market seems unfair when it cannot reflect equally all the diversity because hierarchy exists within. This is because it shows a multitude of social relationships amongst the mass that are not as easily observable in space-time. A market where ‘general-purpose’ money is in circulation creates and exposes many moral discussions, and actions, that can have both relative and universal impacts on individuals, communities, states and the world. This is how progress and change is currently being made, will it maintain into the future – who knows! But money is doing the talking now….
- Bank of England (2014) Quarterly Bulletin Vol 54 No. 1 http://www.bankofengland.co.uk/publications/Documents/quarterlybulletin/2014/qb14q1.pdf
- Douglas, M. (2002). Purity and Danger: An analysis of concept of pollution and taboo. Oxon and New York: Routledge Classics.
- Sandel, M. (2012). What Money Can’t Buy: The Moral Limits of Markets. London. Penguin Books.
- Simmel, G. (2011). The Philosophy of Money. D. Frisby (Ed.) (3rd ed., p. 640). London, New York: Routledge Taylor & Francis Group.