MONEY & ITS PURCHASING POWER
M oney has entered into almost all our discussion. Economy evolved from barter to indirect exchange… indirect exchange to monetary economy… ultimately to a developed economy.
Money is a commodity that serves as a general medium of exchange; its exchanges therefore permeate the economic system. Like all commodities, it has a market demand and a market supply, although its special situation lends it many unique features. “Price” has no unique expression on the market. Other commodities are all expressible in terms of units of money and therefore have uniquely identifiable prices. The money commodity, however, can be expressed only by an array of all the other commodities, i.e., all the goods and services that money can buy on the market. This array has no uniquely expressible unit, and, changes in the array cannot be measured. Yet the concept of the “price” or the “value” of money, or the “purchasing power of the monetary unit,” is no less real and important for all that. It simply must be borne in mind that, there is no single “price level” or measurable unit by which the value-array of money can be expressed. This exchange-value of money also takes on peculiar importance because, unlike other commodities, the prime purpose of the money commodity is to be exchanged, now or in the future, for directly consumable or productive commodities.
A man will always earn more money at a higher wage rate, less money at a lower. But what is earning money but another name for buying money? And that is precisely what is done. People buy money by selling goods and services that they possess or can create. We are now attempting to arrive at the demand schedule for money in relation to various alternative purchasing powers or “exchange-values” of money.
MAN, ECONOMY & STATE
New metal-organic frameworks could make the transport, storage, and delivery of hydrogen much easier and open the door to what has