VI. On the Genesis of Media of Exchange.
It has long been the subject of universal remark in centres of
exchange, that for certain commodities there existed a greater, more
constant, and more effective demand than for other commodities less
desirable in certain respects, the former being such as correspond
to a want on the part of those able and willing to traffic, which is
at once universal and, by reason of the relative scarcity of the
goods in question, always imperfectly satisfied. And further, that
the person who wishes to acquire certain definite goods in exchange
for his own is in a more favourable position, if he brings
commodities of this kind to market, than if he visits the markets
with goods which cannot display such advantages, or at least not in
the same degree. Thus equipped he has the prospect of acquiring such
goods as he finally wishes to obtain, not only with greater ease and
security, but also, by reason of the steadier and more prevailing
demand for his own commodities, at prices corresponding to the
general economic situation -- at economic prices. Under these
circumstances, when any one has brought goods not highly saleable to
market, the idea uppermost in his mind is to exchange them, not only
for such as he happens to be in need of, but, if this cannot be
effected directly, for other goods also, which, while he did not
want them himself, were nevertheless more saleable than his own. By
so doing he certainly does not attain at once the final object of
his trafficking, to wit, the acquisition of goods needful to
himself. Yet he draws nearer to that object. By the devious way of a
mediate exchange, he gains the prospect of accomplishing his purpose
more surely and economically than if he had confined himself to
direct exchange. Now in point of fact this seems everywhere to have
been the case. Men have been led, with increasing knowledge of their
individual interests, each by his own economic interests, without
convention, without legal compulsion, nay, even without any regard
to the common interest, to exchange goods destined for exchange
(their "wares") for other goods equally destined for
exchange, but more saleable.
With the extension of traffic in space and with the expansion over
ever longer intervals of time of prevision for satisfying material
needs, each individual would learn, from his own economic interests,
to take good heed that he bartered his less saleable goods for those
special commodities which displayed, beside the attraction of being
highly saleable in the particular locality, a wide range of
saleableness both in time and place. These wares would be qualified
by their costliness, easy transportability, and fitness for
preservation (in connection with the circumstance of their
corresponding to a steady and widely distributed demand), to ensure
to the possessor a power, not only 'here' and 'now' but as nearly as
possible unlimited in space and time generally, over all other
market-goods at economic prices.
And so it has come to pass, that as man became increasingly
conversant with these economic advantages, mainly by an insight
become traditional, and by the habit of economic action, those
commodities, which relatively to both space and time are most
saleable, have in every market become the wares, which it is not
only in the interest of every one to accept in exchange for his own
less saleable goods, but which also are those he actually does
readily accept. And their superior saleableness depends only upon
the relatively inferior saleableness of every other kind of
commodity, by which alone they have been able to become generally
acceptable media of exchange.
It is obvious how highly significant a factor is habit in the
genesis of such generally serviceable means of exchange. It lies in
the economic interest of each trafficking individual to exchange
less saleable for more saleable commodities. But the willing
acceptance of the medium of exchange presupposes already a knowledge
of these interest on the part of those economic subjects who are
expected to accept in exchange for their wares a commodity which in
and by itself is perhaps entirely useless to them. It is certain
that this knowledge never arises in every part of a nation at the
same time. It is only in the first instance a limited number of
economic subjects who will recognize the advantage in such
procedure, an advantage which, in and by itself, is independent of
the general recognition of a commodity as a medium of exchange,
inasmuch as such an exchange, always and under all circumstances,
brings the economic unit a good deal nearer to his goal, to the
acquisition of useful things of which he really stands in need. But
it is admitted, that there is no better method of enlightening any
one about his economic interests than that he perceive the economic
success of those who use the right means to secure their own. Hence
it is also clear that nothing may have been so favourable to the
genesis of a medium of exchange as the acceptance, on the part of
the most discerning and capable economic subjects, for their own
economic gain, and over a considerable period of time, of eminently
saleable goods in preference to all others. In this way practice and
a habit have certainly contributed not a little to cause goods,
which were most saleable at any time, to be accepted not only by
many, but finally by all, economic subjects in exchange for their
less saleable goods; and not only so, but to be accepted from the
first with the intention of exchanging them away again. Goods which
had thus become generally acceptable media of exchange were called
by the Germans Geld, from gelten, i.e. to pay, to perform, while
other nations derived their designation for money mainly from the
substance used, the shape of the coin, or even from
certain kinds of coin. It is not impossible for media of
exchange, serving as they do the commonweal in the most emphatic
sense of the word, to be instituted also by way of legislation, like
other social institutions. But this is neither the only, nor the
primary mode in which money has taken its origin. This is much more
to be traced in the process depicted above, notwithstanding the
nature of that process would be but very incompletely explained if
we were to call it 'organic' or denote money as something
'primordial', or 'primaeval growth', and so forth. Putting aside
assumptions which are historically unsound, we can only come fully
to understand the origin of money by learning to view the
establishment of the social procedure, with which we are dealing, as
the spontaneous outcome, the unpremeditated resultant, of
particular, individual efforts of the members of a society, who have
little by little worked their way to a discrimination of the
different degrees of saleableness in commodities.
