At first, notes could be issued by all commercial banks but with the passage of time when paper money became inconvertible into metallic money issuing of notes became the monopoly of the Central Bank of a country. Commodity Money. The development of money has passed through various stages in accordance with time, place and circumstances with the progress of civilization of mankind. An essential pre-requisite of money which needs to be emphasised is that it should be generally acceptable in a society as a medium of exchange. Evolution of Money 1. Commodity theory asserts that money has evolved spontaneously from one of the useful commodities through a long process of barter exchanges, and cartal theory argues that money was introduced by a communal agreement or political decree or legislative action that is external to the exchange process. Public profiles for Economics researchers, Various rankings of research in Economics & related fields, Curated articles & papers on various economics topics, Upload your paper to be listed on RePEc and IDEAS, RePEc working paper series dedicated to the job market, Pretend you are at the helm of an economics department, Data, research, apps & more from the St. Louis Fed, Initiative for open bibliographies in Economics, Have your institution's/publisher's output listed on RePEc. Plagiarism Prevention 4. The use of cattle and other animals as money suffered from certain disadvantages.
Evolution of Money: Essay on the Evolution of Money! Paper money took the form of bank notes which were not mere substitutes but were considered as an addition to the supply of money.
In the second stage of the evolution, when the early human shifted from hunting to agriculture, animals like cattle’s, goats, sheep become the medium of exchange and acted as money. Wikipedia is a free online encyclopedia, created and edited by volunteers around the world and hosted by the Wikimedia Foundation.
Commodity Money: Today when in India we think of money, it is generally in terms of rupee notes, in the USA it is in terms of dollar notes and in Great Britain it is in terms of Pound Sterling, and all of these are mostly made of paper. 3. In the early twenties this happened to ‘Mark’ in Germany and it may happen to ‘Rouble’ of Soviet Russia at present as its value in the recent past is fast depreciating. Since millennium, economists have advanced two competing theories on the evolution of money. As it came to be firmly realised for a sound money, scarcity is more important than value, precious metals were replaced by paper money. Prohibited Content 3. You can help adding them by using this form . Since millennium, economists have advanced two competing theories on the evolution of money. Perhaps most remarkable, David Orrell and Roman Chlupatý have produced an economics book on money that is elegantly written. However, in the beginning it was commodities which was selected as a medium of exchange and thus came to be used as money. The sharing economy's unique customer-to-company exchange is possible because of the way in which money has evolved. MONEY Money is any thing which is used as a medium of exchange. See general information about how to correct material in RePEc. Crowther thus sum up the superiority of precious metals like gold and silver for monetary use “They are easily handled and stored, they do not deteriorate, they have the just the right degree of scarcity and they can be relied upon neither to increase nor to diminish in quantity except gradually.”.
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