| Economists generally follow the idea that all trade is barter trade and that money is just an indirection layered on top the “real” economy, which alleviates some of the issues with bartering goods. That’s all fine, but historians and anthropologists have found zero edvidence that the monetary system developed out of barter. Rather, banking seems to have co-evolved alongside interpersonal informal credit systems (contract based, not spot-trade) and religious practices in early agricultural city states. The first written records are bookkeeping documents of grain supplies and outstanding debts between citizens. In time, people started trading these documents against each other. E.g. If you need to pay Garry for fixing your plumbing, but Sally still needs to pay you for the 8 eggs she borrowed, you can just tell her to pay it to Garry instead and you’l be even. What coins are in this model are abstract tokens representing the ledgers inside the third party’s accounting table which denote the debts and credits people hold against eachother. In other words, it’s all about accounting. Economics courses do not include accounting, generally. The real issue economists fail to “get” it is that it invalidates many of the axioms on which they construct their theory. Economics is still very much a deductive science. Because there is such a large hivemind around these fundamental founding myths the field has been able to get by with simply ignoring outside criticisms, this includes a number of “own goals”. If you have some econ 101 knowledge you might want to look up the “anything goes” theorem. Many nobel prizes can be thrown out of the window. I found Steve Keen’s “Debunking Economics” and Phillip Mirowski’s “More Heat Than Light” to be very revealing. |