Elementary principles of economics by unknow

Author:unknow
Language: eng
Format: epub
Tags: Economics
Publisher: New York, The Macmillan company;
Published: 1918-03-25T05:00:00+00:00

or services to-day to one who can pay me only at some future time, it is of the utmost importance that we should have some agreed standard according to which the payment should be made. This function of money is usually facilitated by having a legal tender quality attached to it, though such a legal tender quality is by no means necessary to the fulfilling of the function. By the use of the term " legal tender " we mean simply that the legislature has declared that anyone having a debt to pay may discharge his debt through the " tender " or offer of the prescribed commodity, and that in case of a suit at law the courts will declare such a tender to have been a legal one. It is clear that the third function is only an extension of the second. Some authors attribute to money a fourth function, that of serving as a store or receptacle of value, so that the value may be transferred from place to place and from time to time. Thus Roman gold money, preserved for two thousand years, has brought its value down to our own time; and gold money taken across the Atlantic bears with it its stored-up value.

And now we may sum up what has gone before in a formal definition of money in the stricter sense of the word. Money is any commodity that serves as a medium of exchange, as a denominator or namer of values, and as a standard of deferred payments. And the economists who regard the fourth function of money as essential would complete the definition by adding the words " and as a store of value." The meaning given to the word money in the following pages, whether popular or scientific, will in each case be evident from the context.

Qualities Desirable in the Material of our Money. — Many things have been used as money at one time or another in the world's history: cattle nearly every^^here; furs, especially in the Northern countries; oil; wampum, among the early New Englanders and New Yorkers; tea, at Rus-

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