These can be derived directly or indirectly from the two main functions of money. Money is – store of value: one saves in money; in other words: money can basically be invested as a stock of purchasing power; – accelerator of the economic process (productive agent): through money, the economic process can be shortened in time, because without money, exchange would be very cumbersome: exchange would quickly come up against technical and organizational limits; – standard for deferred payments: money can be used to lend to others and, accordingly, to repay a loan taken out; – means of value transaction over space: one can bring the purchasing power contained in the money in principle at each place of the world to the effectiveness; – carrier of choice decisions (bearer of options): one is able to change money at any time into any commodity (commodity or service);- incentive to production (motive to production): one strives for producing a maximum quantity of goods and supplying the market, in order to receive the desired money; – layer breaker (social neutraliser): everyone can possess money. In contrast to the visible, hereditary property (land, forests, cattle herds) in the pre-money society, wealth is no longer bound to a certain social class;- facilitator of common wealth: money creates the prerequisite for free market traffic. The common good function of money lies in the fact that money facilitates the social function of competition in an economy based on the division of labor. – measure of success: one can make the success and failure of social and personal actions calculable in money and through money; – appraiser of desires: one can express one’s personal desires (as subjective utility judgments) objectively through money, namely through bids in money. On the other hand, however, one is also able to measure existing desires in money and to objectify them in this way, i.e.: to mirror them in money (price); – medium of exchange synchronization: in money (monthly salary) one can acquire goods for which a service in return (work) has already been rendered and VICE VERSA; – representation of sovereign power: it testifies to the sovereignty of the state over the monetary system; – expression of national reputation: the prestige of a state depends in no small measure on the esteem in which its money is held; – social integrator: money is recognized as the bond that binds together the individuals of a (large) group; – dominating power: as the owner of money, one can exercise power, i.e. impose one’s own will; – medium to hiding. Wealth in the form of money can be easily concealed (in contrast to, say, land ownership); – driving force to social interaction: at least the use of cash forces people to approach each other for the purpose of exchange; – legal tender: in most cases, one is obliged by the legal system to accept government money in payment and to make payments in such money. – See actus purus principle, initial fact, economic, money, private, money fear, money base, money functions, primary, money home, money supply, money purpose, hard money, inflation, capital, purchasing power, ktematometer, lug-and-frog thesis, coinage profit, nominal value principle, regional money, seigniorage, saving, symbol theory, currency, payment, means of payment, central bank money, interest.
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University Professor Dr. Gerhard Merk, Dipl.rer.pol., Dipl.rer.oec.
Professor Dr. Eckehard Krah, Dipl.rer.pol.
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