Money is a liquid form of exchange and used primarily because it's more convenient than bartering. Without money, your economy would be like Venezuela.

Could we do away with money?

Ok correct me if I'm wrong but by money your refuing to the paper money, if we did away with it the only consequences is the economy would shrink.

However if you did away with the Idea of money entirely you would not be able to have an economy function beond a small group of people.

Money is a universal "Good" by wich all "Goods" are extanged without it we would need to barter, wich has many problems.

Look up the history of paper money for more

Could we do away with money? — Andrew4Handel

We are already doing away with physical money, with the cash and coins.

Yet there are so many upsides to a monetary system than a barter system without money.

The usual issues simply rule and are so awesome to bartering: a legal tender, a medium of change, an unit of account, a store of value, a liquid asset and sometimes a standard of deferred payment.

Modern money is mainly fiat money which gets its value from the government So it is not the equivalent of bartering.

I think governments and international bodies have the power to shape the economy and often intervene even in when they claim they aren't or shouldn't.

I think the government could distribute resources and do this as part of a social contract. Governments can also confiscate resources.

An example of the government distributing resources could be The National Health service in my country where anyone is allowed to access it and they get the treatment they need.

People have to need a treatment or they have to pay. For example they would have to pay for non essential cosmetic surgery or for any treatment that was not deemed essential, necessary or viable.

What I am mainly wondering about is how money acts as a stimulus for innovation.

It might be that money just redistributes resources to particular tasks and bodies that are innovative.

So money is like a permission slip to resources and time and person power.

I find it strange what an incentive a money is when it not metaphysical a real thing but a kind of representation or concept.

This is The Stanford encyclopedia on the ontology of money:


"The social ontology of money: But exactly how does the “social construction” of money work? This question invokes the more general philosophical issue of social ontology, with regard to which money is often used as a prime example. An influential account of social ontology holds that money is the sort of social institution whose existence depends on “collective intentionality”: beliefs and attitudes that are shared in a community (see, e.g., Searle 1995, 2010; Smit, Buekens, & du Plessis 2011). The process starts with someone’s simple and unilateral declaration that something is money, which is a performative speech act (see Austin 1962). When other people recognize or accept the declaration it becomes a standing social rule. Thus, money is said to depend on our subjective attitudes but is not located (solely) in our minds (for a discussion see also the entries on social ontology and social institutions). In an early philosophical-sociological account, Georg Simmel (1900) had described money as an institution that is a crucial precondition for modernity because it allows putting a value on things and simplifies transactions; he also criticizes the way in which money thereby replaces other forms of valuation (see also section 4.1)."

https://plato.stanford.edu/entries/money-finance/

I believe that fiat money gets its ultimate value by the issuing government's promise to accept it in payment of a debt. There will always be lots of people with debts to a government, tax being the most obvious example. Those people will be happy to accept money for goods or services, because that money allows them to pay their debt to the government. The effect of this promise propagates throughout the economy, as trades for money can occur between two people neither of which has a debt to the government, because they both know they could use the money to buy goods and services from somebody that does have a debt to the government.

Sure we could do away with money. Other animals go on without money just fine.

If you can provide for yourself, if you don't need others to do things for you, then you don't need money. If you do something for others and don't expect anything in return, you don't need money.

A society where people would provide for themselves and help one another would not need money.

There is nothing that would prevent innovation in such a society, as soon as your basic needs are met you have free time for innovation.

But as soon as you want others to do something for you and they want something in return then barter appears. "I'll do this for you only if you do this for me". Then money makes the bartering more efficient. Then there are some people who game the system and get to have plenty of money while doing nothing for others, and those who play by the rules have to work that much harder for others to compensate.

Then when you grow up into a society where you're forced to pay money to live on a land, you are forced to work for others for money, you don't have the option to provide for yourself. Then in such a society money forces most of our interactions to be master/slave relationships, in which to get what they need people are forced to do what those who have money want.

When you think about it the whole thing is disgusting. But of course those who enjoy the way things are have all the incentives to prevent things from changing. Of course we could have innovation and technology without money, but those who live the good life while leeching off the work of others don't want them to know.

Why do we need money to do things? — Andrew4Handel

Money arose because directly bartering for stuff you want/need was a lot less convenient.

There's a good book by Jack Weatherford about the history of money. It came into existence in Lydia and altered human life. It facilitated trade by eliminating some of the risk associated with commodity money, it allowed commoners to trade, and it launched banking.

Weatherford says all societies are organized around something of value, cattle, for instance. In a cattle society, the importance of cows shows up everywhere.

Our society is organized around money, which an abstraction. So the notion that Descartes introduced the ontological confusions we deal with is wrong. It's directly related to something fundamental to who we are: money.

But exactly how does the “social construction” of money work?

It works because we believe it works, it is literally as simple as that.

I've been asking similar questions too. No definite answer as of yet.

I think, as others have said, money is about convenience. If I were a sheep rearer I wouldn't have to drag a group of them everywhere I go. I simply have the easier option of shoving the right amount of banknotes in my pockets. If I were a sweeper I wouldn't have to sweep every shopkeeper's house for my food/clothes. All I need is the right amount of money.

That said, money introduces/amplifies the economic notion of profit. Bartering is based on some form of equality e.g. 10 sheep = 1 cow or something like that. With money this isn't the case. The producer/goods provider wants an extra amount. Of course we can think of it as simply the added cost of a person's input into basic goods/services. However, this is not entirely true and this causes an extra layer of rich/super-rich people in society. This is where the ills of money lie.

I think, as others have said, money is about convenience. If I were a sheep rearer I wouldn't have to drag a group of them everywhere I go — TheMadFool

Often research groups and groups involved in projects or the government will claim we need X amount of money.

Why don't they specify the actual material they need so that people can directly supply the material?
Because I always wonder what they need the money for and the figures seem arbitrary. Sometimes the money might be to pay someones large salary or for some form of bureaucracy.

I do think there is something lacking in transparency in the values created by money I suppose in bartering or other material transactions you know what your getting.

↪Andrew4Handel
But exactly how does the “social construction” of money work?
It works because we believe it works, it is literally as simple as that. — hachit

I suppose it has to be enforced by the law courts and police as well.

Surprisingly you can accrue massive debts without facing prosecution.

Often research groups and groups involved in projects or the government will claim we need X amount of money.

Why don't they specify the actual material they need so that people can directly supply the material?
Because I always wonder what they need the money for and the figures seem arbitrary. Sometimes the money might be to pay someones large salary or for some form of bureaucracy.

I do think there is something lacking in transparency in the values created by money I suppose in bartering or other material transactions you know what your getting. — Andrew4Handel

I understand what you mean. Try to think of how the supplier, in the scenario you described, would ask in exchange? What would a group of researchers have that would satisfy him? Nothing of course. However, if he were paid some money he could use it purchase what he desired from another person who, in turn, wouldn't want what the supplier could offer but would be happy to earn some money with which he could the same. I think you get my point.

The value in money allows greater flexibility. We can use money to get what we want irrespective of what we can offer in exchange. Imagine looking for buyers for your sheep/corn at a car dealership.