Evolution of Money

Only available on StudyMode
  • Download(s) : 157
  • Published : March 4, 2013
Open Document
Text Preview
Origin and Evolution of Money

Barter

Money, as we know it today, is the result of a long process.

At the beginning, there was no money. People engaged in barter, the exchange of merchandise for merchandise, without value equivalence.

Then, a person catching more fish than the necessary for himself and his group, exchanged his excess fish for the surplus of another person who, for instance, had planted and harvested more corn that what he would need. This elementary form of trade prevailed at the beginning of civilization, and may be found today among people of primitive economies, in regions where difficult access makes money scarce and, even in special situations, where people barter items without regard for their equivalence in value. This is the case, for instance, of a child who exchanges with his friend an expensive toy for another of lesser value, which it treasures.

Goods used in barter are generally in their natural state, in line with the environment conditions and activities developed by the group, corresponding to elementary needs of the group’s members. This exchange, however, is not free from difficulties, since there is not a common measure of value among the items bartered.

Commodity Money
Some commodities, for their utility, came to be more sought than others are. Accepted by all, they assumed the role of currency, circulating as an element of exchange for other products and used to assess their value. This was the commodity money.

Cattle, mainly bovine, was one of the mostly used, and had the advantages of moving for itself, reproducing and rendering services, although there was the risk of diseases and death.

Salt was another commodity money, difficult to obtain, mainly in the interior part of continents, also used as a preservative for food. Both cattle and salt left the marks in the Portuguese language of their function as an exchange instrument,...
tracking img