ABSTRACT
THERE is probably no part of their works in which economists have shown greater unanimity than in their approach to the subject of money. Their chapters usually open with a statement of the obvious difficulties of unorganized barter. The unemployed shoemaker smiles wanly at his unshod neighbours, but between him and them is a great gulf fixed. Adam Smith11 regarded such a state of affairs as the consequence of the lack of a medium of exchange. Later analysis revealed the necessity both for a unit of value and a unit of account (for the measurement and record of indebtedness) to facilitate exchange. These services were performed by coins and the monetary unit : by stages, therefore, the functions of money were revealed. From the discussion of the functions of money economists have usually proceeded to a description of the commodities
selectedfromtimetotimeandplacetoplacetoperform thefunctioJlSwhicheachwriterconceivedtobeappropriatetomoney.Thegeneraluseofthemetalswas noted,andexplainedastheconsequenceoftheirhomogeneity,divisibilityanddurabilityand,inthecaseofthe preciousmetals,oftheirportability.Economicwriters havethenexplainedtheemergenceofcoinageasan attempttofacilitatethecirculationofthemetals.In areaswherecommercewasexpanding,theweighingand assayingofthemetalswasanintolerableobstacleto exchangeandtheStateplacedastampuponingotsofthe metalstoguaranteetheirweightandfineness.Butif theinstitutionofcoinagewasduetoadesiretofacilitate commerce,initssubsequentadministrationothermotives appeared,andmostwritershavebroughttheirintroductiontothestudyofmoneytoaconclusionwitha suggestionthatsoonaftercoinagewasintroduced practicalmonetarypolicywasinfluenced,ifnotdominatedbyabasermotive.AdamSmith1refersto"the avariceandinjusticeofprincesandsovereignstates" who,"abusingtheconfidenceoftheirsubjects,have,by degrees,diminishedtherealquantityofmetalwhich hadbeenoriginallycontainedintheircoins".Mill regarded11this''shallowandimpudentartificeoflowering thestandard"asthe"leastcovertofallmodesof knavery".8
