The Nature of Money
Mainstream economics fails to grasp the specific nature of money. It is seen either as a ‘neutral veil’ over the operation of the ‘real’ economy or alternatively as a ‘thing’ – a special commodity.In this important new book, Geoffrey Ingham draws on neglected traditions in the social sciences to develop a theory of the ‘social relation’ of money. Money consists in socially and politically constructed ‘promises to pay’. This approach is then applied to a range of important historical and analytical questions. The historical origins of money, the ‘cashless’ monetary systems of the ancient Near Eastern empires, the pre-capitalist coinage systems of Greece and Rome, and the emergence of capitalist credit-money are all given new interpretations. Capitalism’s distinctiveness is to befound in the social structure – comprising complex linkages between firms, banks and states – by which private debts are routinely ‘monetized’. Monetary disorders – inflation, deflation, collapse of currencies – are the result of disruptions of, or the inability to sustain, these credit-debt relations. Finally, this theory of money’s ‘nature’ is used to clarify confusions in the recent debates on the emergence of new ‘forms’ and ‘spaces’ of money – global electronic money, local exchange trading schemes, the euro.
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