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Cigarettes, dollars and bitcoins – an essay on the ontology of money

Published online by Cambridge University Press:  16 October 2015

J. P. SMIT ,
FILIP BUEKENS  and
STAN DU PLESSIS
J. P. SMIT*
Affiliation:
Department of Philosophy, University of Stellenbosch, Stellenbosch, South Africa
FILIP BUEKENS*
Affiliation:
Hoger Instituut voor Wijsbegerte, KU Leuven, Leuven, BelgiumInstitute for Logic and Philosophy of Science, Tilburg University, Tilburg, Netherlands
STAN DU PLESSIS*
Affiliation:
Department of Philosophy, University of Stellenbosch, Stellenbosch, South Africa
*
*Email: [email protected]
**Email: [email protected]
***Email: [email protected]
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Abstract

What does being money consist in? We argue that something is money if, and only if, it is typically acquired in order to realise the reduction in transaction costs that accrues in virtue of agents coordinating on acquiring the same thing when deciding what thing to acquire in order to exchange. What kinds of things can be money? We argue against the common view that a variety of things (notes, coins, gold, cigarettes, etc.) can be money. All monetary systems are best interpreted as implementing the same basic protocol. Money, i.e. the thing that we coordinate on acquiring in order to lower our transaction costs, is, in all cases, a set of positions on an abstract mathematical object, namely a relative ratio scale. The things that we ordinarily call ‘money’ are merely records of positions on such a scale.

Type
Research Article
Information
Journal of Institutional Economics , Volume 12 , Issue 2 , June 2016 , pp. 327 - 347
Copyright
Copyright © Millennium Economics Ltd 2015 

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