A functional approach to revealing the essence of money is. About the essence of money, approaches to its definition

The objective need for the emergence and use of money in market conditions leads to the fact that all economic entities modern economy constantly deal with cost, monetary instruments, use them at the micro level of the national economy as a general indicator of the rationality of the actions of firms and households. At the macro level regulation national economy carried out using monetary and financial instruments, having a monetary form.

At the same time, using money and monetary relations as a means and instrument for organizing economic relations at both the micro and macro levels, we rarely think about the essence of money. It would seem a simple question: “What is money?” - remains open to this day. Many generations of economists have tried and are trying to uncover the essence of “familiar strangers.” However, there is still no definition of the essence of money unambiguously recognized by all economists, and the question of the essence modern money remains controversial. However, in practical terms, the importance of this issue is determined by the fact that, in order to develop and effectively use monetary instruments and methods of regulation, it is necessary to understand what, in fact, needs to be regulated, it is necessary to understand the essence of the object of regulation.

A philosophical view of the essence of money. From a philosophical point of view, the essence of money is the internal content of an object, in this case money, expressed in the unity of all the diverse and contradictory forms of its existence. Consequently, the forms of existence of money can be diverse and contradictory, but their essence, the internal content of such an object as money, must remain unchanged, otherwise we will be talking about the essence of another object, which cannot be called money.

The question of the essence of money is debatable: approaches to its definition. Turning today to the question of the essence of money, we can, in the most general form, highlight the following approaches to its definition:

the essence of money is revealed on the basis of a presentation of the history of its origin and commodity origin;

the essence of money is determined through the functions that it performs;

presentation of the essence of money through the search for a number of general properties that characterize the internal content of the subject under study - money, regardless of the diversity of their forms and types.

The first approach is characteristic of Marxist and its derivative directions of development economic thought. As noted above, historically the development of commodity exchange occurred through a change in forms of value: from simple or random to the full or expanded form of value and then to the general and monetary form of value. In the Marxist definition of money, it is of paramount importance that money is a special kind of commodity, the purpose of which is to serve as a universal equivalent of all other goods. This definition is undoubtedly applicable for real (full-value) money, but cannot express the essence of modern forms and types of money, which are inferior.

In the 70s of the twentieth century. the idea of the “representative power” (“representative value”) of modern money appeared, i.e. that credit money, not exchangeable for gold, is representative of real, full-fledged money, the functions of which are still performed by gold. The important thing here is that the emergence of new forms and types of money is one way or another regarded as an increasing “separation” of money from its commodity nature.

The second approach to determining the essence of money in our classification, but the most common among modern Western economists, is functional approach to the essence of money. The essence of money is determined by the functions it performs. This approach is characterized by an attitude towards money as a specific instrument, spontaneously developed (or, more precisely, selected among many alternatives) by the market economy to solve the problems of the commodity economy. It is believed that only those instruments that were able to best perform the functions dictated by the market were able to “retain” as money in the economy.

However, it is worth noting here that the “internal content” of money cannot be reduced only to the functions it performs. With this approach, the properties of money as a category, as a concept, remain “in the shadows.”

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A certain pragmatism in the approach to the essence of money, when it is not the essence itself that is important, but the role that money plays in the economy, leads many economists to the simplified definition of money that we find in modern economic literature. It seems that many foreign economists do not attach much importance to revealing the essence of modern money, simplifying it and defining it as a “social phenomenon” (L. Harris), “an artificial social convention” (P. Samuelson), “Money is what money are doing" ( Money is What Money Does, K. McConnell, S. Brew), “money as a temporary container of purchasing power” (M. Friedman), “everything that is usually accepted in payment for goods and services or in repayment of debts” (F. Mishkin), “a very specific type economic good ( economic good) or rare goods” (R.L. Miller, D.D. Van Hoose), “a standard item used for the exchange of things and services”, etc.

Revealing the essence of money, it should be noted that money is not just a commodity, a thing, an obligation, but also a set of economic relations between people in the process of social production and the movement of a social product from production to consumption. Money as relations of production expresses the relations between economic entities, operating at the micro and macro level, regarding the adoption of rational economic decisions when measuring the cost of goods, organizing and regulating economic turnover, they serve the entire reproductive process.

Money as a reproduction category expresses certain production relations not only in the sphere of exchange, but also in the sphere of production, distribution, and consumption. These relations can be not only commodity-money, but also monetary, financial, settlement, and can express certain economic relations within the national economy or within the framework of international economic relations.

Thus, from the point of view of the essence of the category, its internal content, money is a reproductive economic category, a set of economic and production relations.

Unfortunately, however, the properties of money that make it money still remain unclear; the internal content of money still remains hidden. Externally, on the surface of real economic relations, modern money acts as a means of organizing economic relations in the process of money performing its functions, i.e. means by which specific

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actions in various segments of the market economy and at stages of the reproduction process.

From the point of view of their specific expression, modern money appears on the surface as a set of certain obligations of the issuer: a banknote - as an obligation central bank, deposit money is an obligation commercial bank and so on. At the same time, being obligations of a certain issuer, modern money characterizes a very significant, but only one side of the problem of defining modern money, namely its credit nature (of course, if it is issued on a credit basis). The other side of the problem of defining money, including in its modern forms, is the ability of money to represent the movement of the value of goods and services at the micro- and macroeconomic level, within a single national economy and as a whole within the world economy.

What external general properties must money have, regardless of its forms and types, in order to be recognized as “money”?

Let's start with the fact that money is a unique asset of society, i.e. something that has its own value. The asset of any economic entity (individual, firm, state) is tangible and intangible wealth belonging to the owner in its various forms (this can be inventory, raw materials, real estate, securities etc.). In this capacity, money also appears to be a certain economic good, part of wealth in the form of cash and non-cash funds.

Further, money is not just an asset, but a liquid asset, and the liquidity of money as an asset is higher than the liquidity of all other assets (even such financial ones as shares, corporate bonds and so on.). The liquidity of an asset refers to its ability to be directly used to pay off all obligations of the asset owner. Money, as the most liquid asset, allows you to pay off obligations without any transformations, simply by transferring banknotes or by making entries in accounts. It is not without reason that liquidity is often equated with money. It should be noted that cash has absolute liquidity, the liquidity of non-cash money is lower than cash, since it depends, among other things, on the liquidity of the bank where the account is opened.

So, what is common to money in all historical periods of its evolution is its ability to be an asset of high liquidity. But there are also a number of general and specific properties that distinguish money from any other liquid assets.

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Money as a liquid asset has a certain fixed face value, in contrast, for example, to the nominal value financial assets How sum of money, formally specified, for example, in a security. The face value of money is the amount indicated on it, its denomination. The real value of monetary assets, or their purchasing power, depends on the rate of inflation.

Money, as the most liquid asset with a fixed nominal value, must be characterized by universality. Money appears in the form of universal direct exchangeability for all other goods. As a result, all goods find their final consumer and participate in circulation. Universality is the property of unhindered fulfillment of obligations in relation to all entities offering goods and services on the market. Thus, money must have universal acceptance.

The universality of money is ensured:

legislatively. Relevant regulations(constitution, law on monetary system etc.) is determined by legal means of payment on the territory of a state or group of states united in a monetary union. So, in Art. 75 of the Constitution of the Russian Federation states that monetary unit in Russia is ruble Russian Federation. The introduction and issue of other money in Russia is not allowed;

public trust in money. The usefulness of money as an economic good is preserved even when it decreases purchasing power, if the predictability of the value of money and the ability to perform its functions in the future remain. If the population's confidence in money falls, then no regulations will not force people to save in the form of monetary assets. People will prefer less liquid but more reliable assets (for example, they will buy gold, land and so on.).

Money must be homogeneous, standardization. Homogeneity, standardization or interchangeability is inherent in money due, as a rule, to its uniformity and lack of individual characteristics. As a universal means, they allow for free exchange for any good. “Fungibility facilitates transactions: it allows you to organize the ownership of values without in cash holdings on current accounts, transfers between which are carried out by simple transfer.”

There must be money divisible in order to easily perform its functions on transactions with various amounts.

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Money must be convenient for transportation, recognizable and suitable for storage, without losing its value, and must be portable. We can say that the transition from one form of money to another, a change in types of money is associated with a person’s desire to make money more “convenient” for use in economic circulation, to reduce transaction costs when making various types of economic transactions.

An important property of money should be its protection from counterfeiting; the fight against counterfeiting should remain the task of the state. The possibility of counterfeiting cash or “hacking” through non-cash payments or electronic payments leads to the emergence of counterfeit money and disrupts sustainability money circulation, to people's mistrust of money. In this regard, today not only are the security features of the banknotes themselves being improved, but also extensive campaigns are being conducted to familiarize people with the security features of newly issued banknotes of various denominations (for example, when issuing a new 100-dollar or 20-dollar bill in the USA, issuing euro in cash, 5000-ruble banknote in Russia). The latest banking technologies are also becoming more complex, the implementation of which pays special attention to protecting systems from hacking.

Summarizing the disclosure of the essence of money according to the approach under consideration, we can state that money is reproductive economic category, externally acting as a means of organizing economic relations at the micro- and macro-level, as a special asset of society, which has the following specific properties: the highest liquidity, fixed nominal value, universality, standardization, divisibility.

Control questions

1. What is the difficulty in revealing the essence of money?

2. What are the objective reasons for the need for money?

3. How do rationalistic and evolutionary concepts of the origin of money differ?

4. How is the essence of money revealed based on the history of its origin?

5. How do you understand the functional approach to revealing the essence of money?

6. Can you give examples of discussions on defining the essence of modern money?

7. What are the main properties of money in modern conditions that allow it to be called so?

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8. Can you prove that money is an economic and not a legal category?

Tests and assignments

1. The real value of a banknote today is determined by:

aa the cost of the paper on which it is printed; bb cost of gold; c the cost of labor spent on printing it;

y the cost of goods and services that can be purchased with it.

aa the price of the goods;

bb cost;

bb use value; y level of product quality.

3. Modern money is: aa surrogate money;

bb obligations of banks that are of a credit nature;

cc treasury obligations that are of a credit nature; gg a product of a special kind, with the natural form of which a function is fused

universal equivalent.

4. The definition of money as a commodity of a special kind, with the natural form of which the function of a universal equivalent is “fused”, was given...

5. Fill out the table, indicating which of the economists and in which works provides the following parameters for determining the essence of money.

2. Money is recognized as having “commodity history, commodity origin.”

3. Money is a special commodity that has representative value.

4. The role of universal equivalent is not performed by gold, but by credit money

2. Money is a special, socially recognized commodity - a universal equivalent that has intrinsic value.

3. Money, being the universal equivalent of the cost of goods and services, reflects certain production relations

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tions, serve as a means of control and regulation of production and distribution of goods and services

1. The essence of money is determined by the functions it performs.

2. Anything that people recognize as money and performs its functions can be money.

1. Money is considered as a product of state power and law, and the state not only creates money, but also prescribes payment power for it.

The main provisions of rationalism	1. Full-fledged money spontaneously emerges
Russian theory of the origin of money (1)	divided from the commodity world due to their
	natural properties (homogeneity,
	divisibility, safety, portability,
	high price)

Basic principles of evolutionary	2. A prerequisite for the appearance of money is
theories of the origin of money (2)	there is a transition from subsistence farming
	to the production of goods for exchange

	3. A prerequisite for the appearance of money is
	there is a property separation of production
	goods drivers

	4. Money represents a unit
	measurements based on convention,
	necessary for the exchange

	5. Money is the result of an agreement
	communication between people

	6. Money appeared as a result of general
	natural division of labor and long-term
	th exchange development

7. Supporters of the rationalistic theory of the origin of money believe that:

aa money appeared as a result social division labor and long-term development of exchange;

bb money is the result of an agreement between people;

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centuries, gold money spontaneously emerged from the commodity world due to its natural properties (homogeneity, divisibility, safety, portability, high cost);

8. The prerequisites for the appearance of money are:

aa development of production of goods; bb development of exchange of goods; cc credit development;

gg emergence of property rights; dd all of the above.

9. Proponents of the evolutionary theory of the origin of money believe that:

aa money appeared as a result of the social division of labor

long-term development of trade; bb money is the result of an agreement between people;

centuries, gold money spontaneously emerged from the commodity world due to its natural properties (homogeneity, divisibility, safety,

tativity, high cost);

yy all the answers given are correct.

10. Compliance task. Fill the table.

List of used literature

1. Bernard I., Colley J.-C. Explanatory economic and financial dictionary. In 2 volumes. T. 1: Trans. from fr. M.: International relations, 1994.

2. Keynes J.M. Treatise on monetary reform. M.: Economic life, 1925.

3. Marx K., Engels F. Composition. 2nd ed. T. 23.

4. Samuelson P. Economy. M., 1964.

5. Philosophical encyclopedic dictionary. M.: Soviet encyclopedia, 1983.

6. Chelnokov V.A. The evolution of money, credit, banks. M.: Finance and statistics, 2008.

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FUNCTIONS AND ROLE OF MONEY

After studying this chapter, you will learn:

what is the importance and significance of studying the functions of money; how are the functions of money understood in modern economic

science; why discussions continue on the functions of money;

what is the content of each of the functions of money, the conditions for money to perform this or that function, the meaning of the functions;

what are the features of modern Russian money performing their functions;

what is the role of money in each of the functions.

Turning today to the question of the essence of money, we can, in the most general form, highlight the following approaches described in modern economic literature:

1) the essence of money is revealed in accordance with the history of its origin (commodity origin);

2) the essence of money is determined through the functions that they perform. With this approach, revealing the essence of money is not of great importance - the functions that they can perform are important, and accordingly the role that money plays in the modern economy;

3) the essence of money is determined through a number of general properties that characterize its internal content, regardless of the variety of forms and types.

FIRST APPROACH: DISCOVERING THE ESSENCE OF MONEY

ACCORDING TO THEIR COMMERCIAL ORIGIN

The first approach is characteristic of Marxist and its derivative directions of economic thought. Emphasizing the commodity origin of money, K. Marx noted that with a closed subsistence farming all necessary products were produced and consumed within one's own household, there was no need to exchange goods and money was not needed as a medium of exchange. As it expands economic activity as a result of the specialization of production and the division of labor, when a closed household was no longer able to produce all the products itself, a natural barter economy arose. Goods were exchanged for goods. Historically, the development of commodity exchange occurred through a change in value: from simple or random to the full or expanded form of value and then to the general and monetary form of value. In the Marxist definition of money, it is of paramount importance that money is a special kind of commodity, the purpose of which is to serve as a universal equivalent for other goods. K. Marx in his writings formulated the essence of money many times, remaining in the position that “a special commodity, thus representing the adequate existence of the exchange value of all goods, or the exchange value of goods as a special specific commodity, is money” 1 . This definition of money is undoubtedly applicable for real (full-value) money, but cannot express the essence of modern forms and types of money, which are inferior.

In the 70s of the 20th century, a discussion arose among domestic economists on the nature and functions of modern credit money. The idea of “representative power” (“representative value”) of modern money appeared, i.e. credit money, not exchangeable for gold, are representatives of real, full-fledged money, the functions of which are still performed by gold. More than 30 years later, we understand the importance of that discussion for the development of the theory of money, but at the same time, the emergence of new forms and types of money indicates that money is increasingly “severed” from its commodity nature.

SECOND (FUNCTIONAL) APPROACH TO DISCOVERING THE ESSENCE OF MONEY

The second according to our classification and the most widespread in the West approach to determining the essence of money is the functional approach to the essence of money. It is characterized by an attitude towards money as an instrument spontaneously created (more precisely, selected among many alternatives) by the market economy to solve the problems of the commodity economy. Only those instruments that were able to best perform the functions dictated by the market were able to remain as money in the economy. Thus, the essence of money is determined by the functions it performs.

However, it should be noted that the “internal” content of money cannot be reduced only to the functions it performs, since in this case the properties of money remain in the shadows.

Some pragmatism in the approach to the essence of money, when it is not so much the content of this category that is important, but the essence as such, the role that money plays in the economy, leads many economists to a simplified definition of money, which we find in modern specialized literature.

Perhaps for this reason, many foreign economists do not attach much importance to the formulation of the concept of modern money, simplifying it and defining it as a “social phenomenon” (L. Harris), “an artificial social convention” (P. Samuelson), “a temporary container of purchasing power” (M . Friedman), “everything that is usually accepted in payment for goods and services or in reimbursement of debts” (F. Mishkin), “a very specific type of economic good or rare good” (P.A. Miller, A.A. Van Hoose), “a standard item, used for the exchange of things and services”, “money is what money does” (K.P. McConnell, S.L. Bru), etc.

THIRD APPROACH: ESSENTIAL PROPERTIES OF MONEY

properties, internal processes, connections, contradictions, trends, and form

there is a way of existing and expressing content."

First of all, we note that money expresses certain relations of production. This is not only a product, a thing, an obligation, but also a set of economic relations between people in the process of social production and the movement of a social product from production to consumption 2. The basis of production relations is property relations, therefore, the socio-economic content of money, which expresses production relations, changes depending on the method of production. Therefore, we can say that the social essence of money, for example, in the conditions of feudalism, a planned-distributive (socialist) economy, a capitalist (market) or transition to a market economy, will be different while maintaining the essence of money as such.

The emergence of money is associated with commodity production and a fairly high level of development of commodity exchange. Initially, as already noted, money acts as a special socially recognized good - a universal equivalent of the value of all other goods. Moreover, money is a special kind of commodity that has intrinsic value and through which the value of all other goods is measured, as a result of which commodity exchange is transformed into commodity-money exchange.

As we see, money appears initially at the exchange stage. Then they begin to serve the entire reproductive process, gradually becoming a reproductive category.

Thus, money is a reproduction category that characterizes the totality of economic relations.

The reproductive nature of money is already manifested in the fact that money, acting in an equivalent form of value, has the following features:

■ private labor contained in an equivalent product is a form of manifestation social labor, contained in a commodity that is in the relative form of value;

■ concrete labor contained in an equivalent product is a form of manifestation of abstract labor contained in a product, appearing in the relative form of value;

■ the use value of a commodity is a form of manifestation of the value contained in the commodity, which is in the relative form of value.

With the development of commodity production, it is money that begins to connect all market subjects into a single reproduction process. The versatile use of money and its influence on the development of society are largely based on the fact that products are produced by market entities not for their own consumption, but for other consumers to whom they are sold for money. In other words, manufactured products take the form of goods, and between the participants in the processes of production and sale of goods there are commodity-money relationship. Based cash flows in the sphere of financial and monetary relations there is a flow of resources and capital, and overall macroeconomic equilibrium is achieved. Money serves as a means of controlling and regulating the production and distribution of goods and services. These relations can be not only commodity-money, but also monetary, financial, settlement, express certain economic relations within a national or international economy.

Modern money outwardly appears as a set of certain obligations: a banknote - as an obligation of a central bank, non-cash money - as an obligation of a commercial bank, etc. These obligations are regulated by relevant regulations. Is it possible on this basis, adhering to the logic of the nominalistic theory of money, to say that modern money, in fact, is not an economic, but a Legal category? Modern money as a set of obligation relations characterizes a very significant, but only one side of the problem, namely the credit nature of modern money (of course, if it is issued on a credit basis). The other side of the problem of money, including in its modern forms, is the ability of money to represent the movement of the value of goods and services at the micro- and macroeconomic levels, within a single national economy and in the world economy as a whole.

As we already said in chapters 1 and 2, money has gone through a long history of changing its forms and types. What properties must money have in order to be recognized as money, how does money differ from money surrogates, substitutes, “almost” money or quasi-money?

An interesting remark on this matter was given by F.A. Hayek: “The popular idea that there is a clear line of demarcation between money and non-money—and the law generally attempts to make such a distinction—is in fact false when it comes to monetary cause and effect. What we find here is rather a continuum in which objects with different degrees of liquidity and with different (fluctuating independently of each other) values gradually transform into each other as they function as money.” And further he notes: “The thesis about the existence of one, clearly defined thing called “money”, which can be easily distinguished from other things, is a legal fiction.”

GENERAL PROPERTIES OF MONEY

Let's try to highlight the general properties of money, regardless of their forms and types. Let's start with the fact that money is a kind of asset of society, i.e. something that has its own value. The asset of any economic entity (individual, firm, state) is a material property belonging to the owner

and intangible wealth in its various forms (this can be inventories, raw materials, real estate, securities, etc.). In this capacity, money also appears to be a certain economic good, part of wealth in the form of cash and non-cash funds.

In addition, money is a highly liquid asset, and the liquidity of monetary assets is higher than the liquidity of all other assets (even financial assets such as stocks and corporate bonds). Money, as the most liquid asset, allows you to pay off obligations without any transformations by simply transferring banknotes or by making entries in accounts. It is not without reason that liquidity and money are often equated. Although it should be noted that cash has absolute liquidity, the liquidity of non-cash money is lower than cash, since it also depends on the liquidity of the bank in which the account is opened.

Presenting money as a specific liquid asset involves considering the characteristics of demand for this asset on the part of owners and recipients of income, which will be discussed in Chapter 3.

So, what is common to various forms and types of money in all historical periods of their evolution is the property of money to be an asset of high liquidity. But there are also a number of general properties (which we mentioned in Chapters 1 and 2) that distinguish money from any other liquid asset. Let's look at some of these properties.

Money as a highly liquid asset has a certain fixed nominal value, in contrast, for example, to the nominal value of financial assets as an amount of money formally indicated, say, on a security.

Money, as the most liquid asset with a fixed nominal value, must be characterized by universality. Money appears in the form of universal direct exchangeability for all other goods. As a result, all goods participating in circulation find their final consumer. Universality is the property of unhindered fulfillment of obligations in relation to all entities offering goods and services on the market. Thus, money must have universal acceptance.

The universality of money is ensured:

■ legislatively. The relevant regulations (constitution, law on the monetary system, etc.) determine legal tender on the territory of a state or group of states united in a monetary union. Thus, the Constitution of the Russian Federation (Article 75) notes that the monetary unit in the Russian Federation is the ruble. The introduction and issue of other money in the Russian Federation is not allowed;

■ public confidence in money. The usefulness of money as an economic good is preserved even if its purchasing power decreases, if the predictability of the value of money and its ability to perform its functions in the future remain. If public confidence in money declines, then no regulations will force people to save in the form of monetary assets. People will prefer less liquid but more reliable assets (for example, they will buy gold or land).

Money should be characterized by homogeneity - staidarization (interchangeability). This property is inherent in money, as a rule, due to its uniformity and lack of individual characteristics. As a universal means, they allow free exchange for any good. “Fungibility facilitates transactions: it allows you to organize the ownership of values in non-cash form holdings on current accounts, transfers between which are carried out by simple transfer.”

Money must be divisible in order for it to perform its functions in transactions involving different amounts.

Money must be transportable (i.e. convenient for transportation), recognizable and suitable for storage without losing its value, and must also be portable (i.e. high cost per unit weight). We can say that the transition from one form of money to another, a change in types of money is associated with a person’s desire to make money more convenient for use in economic circulation, to reduce transaction costs when making various types of economic transactions.

An important property of money is its protection from counterfeiting, which makes it easier for the state to combat counterfeiting. The possibility of counterfeiting cash, or “hacking” in relation to non-cash payment instruments or electronic money, leads to the appearance of counterfeit money, which disrupts the stability of money circulation and causes people to distrust money. Therefore, today not only are the security features of the banknotes themselves being improved, but large-scale campaigns are also being conducted to familiarize people with the security features of newly issued banknotes of various denominations (for example, when issuing a new 100-dollar or 20-dollar bill in the USA, euro bills, a new 1000-ruble banknotes in Russia). The latest banking technologies are also becoming more complex, during the implementation of which special attention is paid to protecting banking systems from hacking.

Money is one of the greatest inventions of mankind, has a long history of development and has a huge impact on the market economy: economic entities in market conditions constantly operate with cost and monetary categories, using them as a general indicator of the rationality of the actions of firms and households. An excursion into the history of forms and types of money allows us to draw a conclusion about a radical change in the essence of full-fledged money and, as a result, the emergence of substitutes for money. Many generations of economists have tried and are trying to uncover the essence of money. But there is still no definition of the essence of money that is unequivocally recognized by all economists. From a philosophical point of view, the essence of money is the internal content of an object, in this case money, expressed in the unity of all the diverse and contradictory forms of its existence. Consequently, the forms of existence of money can be diverse and contradictory, but their essence, internal content must remain unchanged, otherwise we will be talking about the essence of another object, which cannot be called money.

Turning today to the question of the essence of money, we can, in the most general form, highlight the following approaches described in modern economic literature:

1) the essence of money is revealed in accordance with the history of its origin (commodity origin);

2) the essence of money is determined through the functions that it performs. With this approach, revealing the essence of money is not of great importance - what is important are the functions that it can perform, and, accordingly, the role that money plays in the modern economy;

3) the essence of money is determined through a number of general properties that characterize its internal content, regardless of the variety of forms and types.

First approach: revealing the essence of money in accordance with its commodity origin

The first approach is characteristic of Marxist and its derivative directions of economic thought. Emphasizing the commodity origin of money, K. Marx noted that in a closed natural economy, all necessary products were produced and consumed within one’s own household, there was no need for the exchange of goods and money was not needed as a means of exchange. As economic activity expanded as a result of specialization of production and division of labor, when a closed household was no longer able to produce all the products itself, a natural barter economy arose. Goods were exchanged for goods. Historically, the development of commodity exchange occurred through a change in value: from simple or random to the full or expanded form of value and then to the general and monetary form of value. In the Marxist definition of money, it is of paramount importance that money is a special kind of commodity, the purpose of which is to serve as a universal equivalent for other goods. K. Marx in his writings formulated the essence of money many times, remaining in the position that “a special commodity, thus representing the adequate existence of the exchange value of all goods, or the exchange value of goods as a special specific commodity, is money.” This definition of money is undoubtedly applicable for real (full-value) money, but cannot express the essence of modern forms and types of money, which are inferior.

The second (functional) approach to revealing the essence of money

The second and most common approach in the West to determining the essence of money is the functional approach to the essence of money. It is characterized by an attitude towards money as an instrument spontaneously created (more precisely, selected among many alternatives) by the market economy to solve the problems of the commodity economy. Only those instruments that were able to best perform the functions dictated by the market were able to remain as money in the economy. Thus, the essence of money is determined by the functions it performs.

However, it should be noted that the “internal” content of money cannot be reduced only to the functions it performs, since in this case the properties of money remain in the shadows.

Perhaps for this reason, many foreign economists do not attach much importance to the formulation of the concept of modern money, simplifying it and defining it as a “social phenomenon” (L. Harris), “an artificial social convention” (P. Samuelson), “a temporary container of purchasing power” ( M. Friedman), “everything that is usually accepted in payment for goods and services or in reimbursement of debts” (F. Mishkin), “a very specific type of economic good or rare commodity” (R.L. Miller, A.A. Van- Hoose), “a standard item used for the exchange of goods and services”, “money is what money does” (K.R. McConnell, S.L. Brew), etc.

Third approach: essential properties of money

In the framework of the third approach, we will try to explain the essence of money by identifying a number of general properties that characterize its internal content, regardless of all the variety of forms and types of a given object, based on the fact that “the content, being the defining aspect of the whole, represents the unity of all the constituent elements of the object, its properties, internal processes, connections, contradictions, trends, and form is a way of existence and expression of content.” First of all, we note that money expresses certain relations of production. This is not only a product, a thing, an obligation, but also a set of economic relations between people in the process of social production and the movement of the social product from production to consumption. The basis of production relations is property relations, therefore, the socio-economic content of money, which expresses production relations, changes depending on the method of production. Therefore we can say that social essence of money, for example, under conditions of feudalism, a planned-distributive (socialist) economy, a capitalist (market) or transition to a market economy will be different while maintaining the essence of money as such 3.

The emergence of money is associated with commodity production and is quite high level development of commodity exchange. Initially, as already noted, money acts as a special socially recognized commodity - a universal equivalent of the value of all other goods. Moreover, money is a special kind of commodity that has intrinsic value and by means of which the value of all other goods is measured, as a result of which commodity exchange is transformed into commodity-money exchange.

As we see, money appears initially at the exchange stage. Then they begin to serve the entire reproductive process, gradually becoming a reproductive category.

So money is reproductive category, characterizing a set of economic relations.

The reproductive nature of money is already manifested in the fact that money, acting in an equivalent form of value, has the following features:

* private labor contained in an equivalent commodity is a form of manifestation of social labor contained in a commodity located in the relative form of value;

* concrete labor contained in an equivalent product is a form of manifestation of abstract labor contained in a product appearing in the relative form of value;

* the use value of a commodity is a form of manifestation of the value contained in the commodity, which is in the relative form of value.

With the development of commodity production, it is money that begins to connect all market subjects into a single reproduction process. The versatile use of money and its influence on the development of society are largely based on the fact that products are produced by market entities not for their own consumption, but for other consumers to whom they are sold for money. In other words, manufactured products take the form of goods, and commodity-money relations develop between participants in the processes of production and sale of goods. Based on cash flows in the sphere of financial and monetary relations, a flow of resources and capital occurs, and overall macroeconomic balance is achieved. Money serves as a means of controlling and regulating the production and distribution of goods and services. These relations can be not only commodity-money, but also monetary, financial, settlement, and express certain economic relations within the framework of the national or international economy.

Money is one of the greatest inventions of mankind, has a long history of development and has a huge impact on the market economy: economic entities in market conditions constantly operate with cost and monetary categories, using them as a general indicator of the rationality of the actions of firms and households. An excursion into the history of the forms and types of money allows us to conclude that there has been a radical change in the form of money and, as a result, the emergence of money substitutes. However, does the diversity of forms and types of money existing today and developing in the future change its essence as an economic category? It would seem a simple question: what is money? But it still remains open. Many generations of economists have tried and are trying to uncover the essence of “familiar strangers.” But there is still no definition of the essence of money that is unequivocally recognized by all economists.

From a philosophical point of view, the essence of money is the internal content of an object, in this case money, expressed in the unity of all the diverse and contradictory forms of its existence. Consequently, the forms of existence of money can be diverse and contradictory, but their essence (internal content) must remain unchanged, otherwise we will be talking about the essence of another concept, which cannot be called money.

3.2. The debatability of the issue of the essence of money, approaches to its definition

Turning today to the question of the essence of money, we can, in the most general form, highlight the following approaches described in modern economic literature:

the essence of money is revealed in accordance with the history of its origin (commodity origin);
the essence of money is determined through the functions that it performs. What is important in this approach is the functions that they can perform and, accordingly, the role that money plays in the modern economy;
the essence of money is determined through a number of general properties that characterize its internal content, regardless of the variety of forms and types.

First approach: revealing the essence of money in accordance with its commodity origin

As economic activity expanded as a result of specialization of production and division of labor, when a closed household was no longer able to produce all the products itself, a natural barter economy arose. Goods were exchanged for goods. Historically, the development of commodity exchange occurred through a change in value: from simple or random to the full or expanded form of value and then to the general and monetary form of value. In the Marxist definition of money, it is of paramount importance that money is a special kind of commodity, the purpose of which is to serve as a universal equivalent for other goods. K. Marx in his writings formulated the essence of money many times, remaining in the position that “a special commodity, thus representing the adequate existence of the exchange value of all goods, or the exchange value of goods as a special specific commodity, is money.” This definition of money is undoubtedly applicable for real (full-value) money, but cannot express the essence of modern forms and types of money, which are inferior.

In the 70s of the twentieth century, a discussion arose among domestic economists on the nature and functions of modern credit money. The idea of “representative power” (“representative value”) of modern money appeared, i.e. credit money, not exchangeable for gold, is representative of real, full-fledged money, the functions of which are still performed by gold. More than 30 years later, we understand the importance of that discussion for the development of the theory of money, but at the same time, the emergence of new forms and types of money indicates that money is increasingly “severed” from its commodity, material nature.

The second (functional) approach to revealing the essence of money

The second according to our classification and the most common in the West approach to determining the essence of money is functional approach to the essence of money. It is characterized by an attitude towards money as an instrument spontaneously created (more precisely, selected among many alternatives) by the market economy to solve the problems of the commodity economy. Only those instruments that were able to best perform the functions dictated by the market were able to remain as money in the economy. Thus, the essence of money is determined by the functions it performs.

However, it should be noted that the “internal” content of money cannot be reduced only to the functions it performs, since in this case the properties of money remain in the shadows.

Perhaps for this reason, many foreign economists do not attach much importance to the formulation of the concept of modern money, simplifying it and defining it as a “social phenomenon” (L. Harris), “an artificial social convention” (P. Samuelson), “a temporary container of purchasing power” (M . Friedman), “everything that is usually accepted in payment for goods and services or in reimbursement of debts” (F. Mishkin), “a very specific type of economic good or rare good” (R.L. Miller, D.D. Van Hoose ), “a standard item used for the exchange of goods and services,” “money is what money does” (K.R. McConnell, S.L. Brew), etc.

Third approach: essential properties of money

In the third approach, we will try to explain the essence of money by identifying a number of general properties that characterize its internal content, regardless of all the variety of forms and types of a given object, based on the fact that “the content, being the defining aspect of the whole, represents the unity of all the constituent elements of the object, its properties, internal processes, connections, contradictions, trends, and form is a way of existence and expression of content."

First of all, we note that money expresses certain relations of production. This is not only a commodity, a thing, an obligation, but also a set of economic relations between people in the process of social production and the movement of the social product from production to consumption. The basis of production relations is property relations, therefore, the socio-economic content of money, which expresses production relations, changes depending on the method of production. Therefore, we can say that the social essence of money, for example, in the conditions of feudalism, a planned-distributive (socialist) economy, a capitalist (market) or transition to a market economy, will be different while maintaining the essence of money as such.

As we see, money appears initially at the exchange stage. Then they begin to serve the entire reproductive process, gradually becoming a reproductive category.

Thus, money is a reproduction category that characterizes the totality of economic relations.

The reproductive nature of money is already manifested in the fact that money, acting in an equivalent form of value, has the following features:

private labor contained in an equivalent commodity is a form of manifestation of social labor contained in a commodity located in the relative form of value;
concrete labor contained in an equivalent commodity is a form of manifestation of abstract labor contained in a commodity appearing in the relative form of value;
The use value of a commodity is a form of manifestation of the value contained in the commodity, which is in the relative form of value.

With the development of commodity production, it is money that begins to connect all market subjects into a single reproduction process. The versatile use of money and its influence on the development of society are largely based on the fact that products are produced by market entities not for their own consumption, but for other consumers to whom they are sold for money. In other words, manufactured products take the form of goods, and commodity-money relations develop between participants in the processes of production and sale of goods. Based on cash flows in the sphere of financial and monetary relations, a flow of resources and capital occurs, and overall macroeconomic balance is achieved. Money serves as a means of controlling and regulating the production and distribution of goods and services. These relations can be not only commodity-money, but also monetary, financial, settlement, and express certain economic relations within the framework of the national or international economy.

Modern money outwardly appears as a set of certain obligations: a banknote - as an obligation of a central bank, non-cash money - as an obligation of a commercial bank, etc. These obligations are regulated by relevant regulations. Is it possible on this basis, adhering to the logic of the nominalistic theory of money, to say that modern money, in fact, is not an economic, but a legal category? Modern money as a set of obligation relations characterizes a very significant, but only one side of the problem, namely the credit nature of modern money (of course, if it is issued on a credit basis). Another side of the problem of money, including in its modern forms, is the ability of money to represent the movement of the value of goods and services at the micro- and macroeconomic levels, within a single national economy and in the world economy as a whole.

An interesting remark on this matter was given by F.A. Hayek: "The popular idea that there is a clear line of demarcation between money and non-money - and the law usually tries to make such a distinction - is in fact false when it comes to causal relationships in the monetary sphere. What we find here is rather a continuum in which objects with different degrees of liquidity and with different (fluctuating independently of each other) values gradually transform into each other as they function as money.” And he further notes: “The thesis that there is one, clearly defined thing called “money”, which can be easily distinguished from other things, is a legal fiction.”

General properties of money

Let's try to highlight the general properties of money, regardless of their forms and types.

Let's start with the fact that money is a kind of asset of society, i.e. something that has its own value. The asset of any economic entity (individual, company, state) is tangible and intangible wealth belonging to the owner in its various forms (this can be inventory, raw materials, real estate, securities, etc.). In this capacity, money also appears to be a certain economic good, part of wealth in the form of cash and non-cash funds.

Presenting money as a specific liquid asset involves considering the characteristics of demand for this asset on the part of owners and recipients of income, which will be discussed below.

So, what is common to various forms and types of money in all historical periods of their evolution is the property of money to be an asset of high liquidity. But there are also a number of common properties that distinguish money from any other liquid assets. Let's look at some of them.

Money as a highly liquid asset has a certain fixed nominal value, in contrast, for example, to the nominal value of financial assets as an amount of money formally indicated, for example, on a security.

The universality of money is ensured:

legislatively. The relevant regulations (constitution, law on the monetary system, etc.) determine legal tender on the territory of a state or group of states united in a monetary union. Thus, the Constitution of the Russian Federation (Article 75) notes that the monetary unit in the Russian Federation is the Russian ruble. The introduction and issue of other money in the Russian Federation is not allowed;
public trust in money. The usefulness of money as an economic good is preserved even if its purchasing power decreases, if the predictability of changes in the value of money and its ability to perform its functions in the future remain. If public confidence in money declines, then no regulations will force people to save in the form of monetary assets. People will prefer less liquid but more reliable assets (for example, they will buy gold or land).

Money must be characterized by homogeneity - standardization (interchangeability). This property is inherent in money, as a rule, due to its uniformity and lack of individual characteristics. As a universal means, they allow free exchange for any good. “Fungibility facilitates transactions: it allows you to organize the ownership of valuables in the non-cash form of holdings on current accounts, transfers between which are carried out by simple transfer.”

Money must be divisible in order for it to perform its functions in transactions involving different amounts.

Money must be transportable (i.e., easy to transport), recognizable and storeable without losing its value, and must also be portable (i.e., high value per unit weight). We can say that the transition from one form of money to another, a change in types of money is associated with a person’s desire to make money more convenient for use in economic circulation, to reduce transaction costs when carrying out various types of economic transactions.

An important property of money is its protection from counterfeiting, which makes it easier for the state to combat counterfeiting. The possibility of counterfeiting cash, or “hacking” in relation to non-cash payment methods or electronic money, leads to the emergence of counterfeit money, which disrupts the stability of monetary circulation and causes people to mistrust money. Therefore, today not only are the security features of the banknotes themselves being improved, but large-scale campaigns are also being conducted to familiarize people with the security features of newly issued banknotes of various denominations (for example, when issuing a new 100-dollar or 20-dollar bill in the USA, euro bills, a new 5000-ruble banknotes in Russia). The latest banking technologies are also becoming more complex, and when implementing them, special attention is paid to protecting banking systems from burglary.

First approach: Disclosure of the essence of money in accordance with its commodity origin

The first approach is characteristic of the Marxist direction of economic thought. Emphasizing the commodity origin of money, K. Marx noted that in a closed natural economy, all necessary products were produced and consumed within one’s own household, there was no need for the exchange of goods and money was not needed as a means of exchange.

In the 70s XX century A discussion arose among domestic economists on the nature and functions of modern credit money. The idea of the “representative power” of modern money appeared, i.e. credit money, not exchangeable for gold, are representatives of real, full-fledged money, the functions of which are still performed by gold. More than 30 years later, we understand the importance of that discussion for the development of money, but at the same time, the emergence of new forms and types of money indicates that money is increasingly “detached” from its commodity nature.

The second (functional) approach to revealing the essence of money

This approach is characterized by an attitude towards money as an instrument spontaneously created (more precisely, selected among many alternatives) by the market economy to solve the problems of the commodity economy. Only those instruments that were able to best perform the functions dictated by the market were able to remain as money in the economy. Thus, the essence of money is determined by the functions it performs.

Third approach: Essential properties of money

Within the third approach, the essence of money is the identification of a number of general properties that characterize its internal content, regardless of the variety of forms and types of a given object.

First of all, it can be noted that money expresses certain relations of production. This is not only a product, a thing, an obligation, but also a set of economic relations between people in the process of social production and the movement of the social product from production to consumption. The basis of production relations is property relations, therefore, the socio-economic content of money, expressing production relations, changes depending on the method of production. Therefore, we can say that the social essence of money, for example, in conditions of feudalism, capitalist or transition to a market economy, will be different while maintaining the essence of money as such.

The emergence of money is associated with commodity production and a fairly high level of development of commodity exchange. Then they begin to serve the entire reproductive process, gradually becoming a reproductive category. With the development of commodity production, it is money that begins to connect all market subjects into a single reproduction process.

Now let’s summarize some of the results of considering the traditional list of functions of money, which was basically formed back in the middle of the 19th century. It can be said that such functions are now recognized. The first is the measurement of value, the introduction of a price scale; the second is a means of purchase or means of exchange. The first and second functions essentially characterize the main property of money - servicing commodity circulation. Therefore, the medium of exchange function is considered the main function of money, which implies that in reality the purchasing medium function is always used together with the price scale function. The third function is a means of payment, which ensures a significant improvement in market relations itself, as well as promoting the spread of monetary relations outside the market sphere.

3. The role of money in the economy

3.1 The role of money and the features of its manifestation in various economic models

The role of money is determined by its essence as a universal equivalent, since the allocation of a specific commodity of a special kind to this role is the law of any commodity production. Money itself affects the economy according to the rules that banks follow when creating money.

The role of money is manifested in the fact that the monetary system ensures the mobilization of financial resources and their most effective use, reduction of costs in economic turnover, unhindered transactions, and strict financial discipline to which all participants in the reproduction process are forced to submit.

Money is an integral part of a developed commodity economy, which has a significant and constant impact on the state of economic life and all economic processes. Money mediates the movement of huge masses of goods, through credit and financial system stimulate development productive forces society. At the same time, money can negatively influence the development of production and cause serious disruptions in the reproduction process, leading to dangerous consequences in the field of social relations. The role of money is also to create and expand mechanisms for the formation of monetary savings and the transfer of resources from savers to investors who are able to use these resources most effectively. The fact is that a significant part of savings is invested in physical assets (goods, gold) or directed towards consumption, without actually providing profit in terms of economic growth. At best, temporarily available funds are provided on credit in the unorganized market or used for self-financing purposes. When savings are low and predominantly physical, investments suffer.

Stimulating monetary savings and increasing the efficiency of their use are achieved through the development of monetary infrastructure. The replacement of direct connections between savers and investors with banking intermediation increases the ratio of the amount of money in circulation to national income, which implies the release of real resources, accompanied by an increase in savings and investment rates, bringing together previously scattered savers and investors through various monetary institutions (institutions), an increase the degree of organization, breadth of coverage and integration of the national financial market, since it begins to be more subordinate to the price mechanism.

The above processes are called “monetization” of the economy (an increase in the share of monetary transactions mediated by financial institutions). In this case, we actually have to deal with the money market, in which demand is represented by the expected volume of investment, supply by the possible amount of savings, and price by the amount interest rate. In the money market (in the monetary economy) there is a circulation of money that serves the reproduction process and does not have a significant impact on it. If in a real economy the reproduction process is carried out, real flows of goods and services move, then in a monetary economy money only serves the movement of these flows, acting as a purely technical means. In the real economy, relative price levels are established, and in the monetary economy, the absolute price level is established.

In accordance with the basic principles of a monetary economy based on the so-called rough quantity theory money, the general price level changes in proportion to changes in the quantity of money in circulation. This theory of money is expressed mathematically by two equations, one of which is called the equation of exchange or Fisher's equation and has the following form:

Where M is the equilibrium quantity of money in circulation; V – velocity of circulation of the monetary unit; P – price level; Y is the volume of products produced and sold by the company during the year.

The second or Cambridge equation is written as follows:

In fact, the influence of money on the economy is most fully expressed through the general law of monetary circulation. The law of monetary circulation states that the amount of money required for circulation changes in direct proportion to the sum of the prices of goods and services sold minus the sum of the prices of goods sold on credit, as well as due payments minus mutually extinguishing obligations and inversely proportional to the speed of circulation of money. Violation of this law leads to disruption of monetary circulation. Therefore, the role of money in market economy has always been significant. [Tarasov V.I.]

The role of money is characterized by the results of its use and impact on various aspects of the activity and development of society.

The role of money is manifested:

1. The results of the participation of money in setting the price of goods.

2. In the process of money circulation when performing the function of a medium of exchange or a means of payment.

3. In the economic activities of enterprises.

4. In the functioning of state bodies.

5. In increasing people's interest in development and increasing production efficiency.

6. In the economical use of resources.

money performs in economic relations with other countries.

The role of money is changing due to changes in economic development conditions. Let us consider the manifestation of its features under different economic models.

In an administrative-command economy money was of no small importance:

1. With their help, it became possible to determine the total volume of various costs (materials, wages, etc.) for the manufacture of products that make up its cost.

2. With the help of money, it became possible to reduce the volumes of various types of products and obtain a generalized indicator of its total volume.

3. The use of money enhanced the ability to account for and control the implementation of various planned indicators and identify measures to improve the activities of enterprises.

However, in an administrative-command economy, the role of money was limited. Money was assigned an auxiliary role, mainly as an instrument of accounting and control by central and other economic management bodies. Under this model, the volume and range of products produced were established by higher authorities for each enterprise in the form of plans in physical and cost terms. At the same time, cost indicators were of subordinate importance and were calculated from prices established by central authorities. This also reduced the role of money, since prices remained unchanged at different ratios of demand and supply of goods.

This economic model is characterized by suppressed inflation, which was accompanied by a decrease in the role of money, since for the purchase of goods it was not so important that the buyer had money, but rather the ability to receive it in accordance with established standards.

When going to market economy models the role of money increases significantly. Thus, the scope of use of money in the privatization of enterprises and property is expanding, the role of money in a reasonable valuation of property is increasing, etc.

The transition to a market economy includes significant changes in the forms of ownership of tools and objects of labor, in the production and sale of products, as a result of which commodity producers acquire independence in establishing the volume and range of products produced and sold. In the new conditions, the opportunities for showing initiative in economic activity increase. At the same time, the role of money is strengthened, with the help of which effective demand can be assessed, taking into account which the volume and range of products produced and sold is formed.

The increasing role of money in a market economy also occurs in the sphere of retail trade, in which distribution according to norms, cards, coupons has been abolished, and money plays a decisive role in determining the possibility of purchasing goods. Money also plays a significant role in determining performance results in the form of profit.

Features of the manifestation of money in different economic models are as follows:

1. In influencing the improvement of economic activity.

2. In strengthening the interest of various parts of the economy in the development of production, primarily through reasonable pricing, stimulating the growth of production volumes and reducing the costs of its production.

3. In creating a regime of dependence of cash expenses on cash receipts, which increases the interest of workers in increasing cash receipts as a result of increased production and economical use of resources.

4. In the process of money circulation, control over prices, volume and quality of supplied products, designed to contribute to a more complete satisfaction of needs. [ http://www.fcredit.ru/archives/109]

Modern money is not only evidence of solvency, but also bearers of the right to receive income, since interest is paid on almost all accounts whose owners issue payment documents, i.e. in its essential characteristics, modern money does not differ from money capital. From this we can conclude that elucidating the role and cost nature of modern money is impossible without studying the cost and price of money capital, interest, as well as the problems of savings and investment. [Tarasov V.I.]

3.2 Changes in the manifestation of the role of money in connection with the development of payment systems based on electronic money

When the Internet became a reality of everyday life ten years ago, it began to rapidly become commercialized. The “network economy” has emerged on the World Wide Web. The growing popularity of websites has led to the fact that they have turned into advertising platforms, and therefore into bargaining items. The development of online stores was a powerful impetus to the fact that all participants in online trade needed a means of payment that was as fast as exchanging files.

Traditional payment systems have many disadvantages that make it impossible to use them in the “network economy”: low security, lack of privacy, low transaction speed (a bank payment even today takes at least a day) compared to the average speed of information transfer on the network, the complexity of mutual settlements and the impossibility conducting micropayments without loss. The last drawback is fundamental for the development of the digital goods market online - the cost of “downloading” melodies, pictures and texts is usually no more than a dollar. Special payment obligations were required that would be, on the one hand, reliable, and on the other hand, protected from counterfeiting no less than regular rubles or dollars, with the third - would be accepted by the majority of network participants and, what is very important, the circulation of which would be carried out instantly or almost instantly.

This is how they appeared credit cards. Here Russia has its own unique experience. The fact is that in Western Europe and the USA already by the mid-80s. XX century Only the baby in the maternity hospital didn’t have a credit card. Therefore, the first payments on the Internet were made using a credit card. In Russia, credit cards still remain the prerogative of a small part of the population. Due to the lack of convenient means of payment, “digital” or, as they say, “electronic” currencies have become widespread in our country. [Science and Life No. 10, 2007]. Electronic money appeared in the 50s, when the search for more economical forms of payments began, which intensified significantly in the 60s-70s. thanks to the implementation in banking sector achievements of scientific and technological progress. For the first time in 1959, Bank of America in San Francisco introduced a fully automated electronic facility for processing checks and maintaining checking accounts. This was followed by the introduction of more advanced generations of computers, which made it possible to connect many subscribers to them using remote devices - remote control terminals. This process covered all banks in the United States and other countries. Mechanization and automation of banking operations, the transition to the widespread use of computers led to the emergence of new methods of repaying or transferring debt using electronic money. Electronic money is money in banks’ computer memory accounts, which is managed using a special electronic device. Based on the introduction of computers into banking, it became possible to replace checks with plastic cards (debit and credit). This is a means of payment that replaces cash and checks, and also allows the owner to obtain a short-term loan from the bank. Plastic card used in retail trade and services. In the electronic money system, money itself loses its intrastate character and becomes a supranational phenomenon. This may not happen if they have an inextricable and close connection with the issuers of national currencies. IN otherwise You may encounter such a phenomenon as “false value of national currencies.”

With electronic money, the monetary system turns into an independent system that interacts in a certain way with the public administration system, but does not merge with it. As a result, when electronic money operates, the role of the central bank changes, and the functioning of the banking system as a whole becomes essential. This does not mean that central and commercial banks are of equal importance in the economy. Their goals, functions and roles continue to differ, but it must be taken into account that verification (establishing the authenticity) of electronic money that does not have a material expression (physical media or hard copies) is possible only in a certain way built system and only by means of information support. This circumstance makes significant adjustments to the traditional idea of money and monetary circulation. [Electronic resource].

Conclusion

A lot of time has passed since the first money appeared. The first money was significantly different from modern money. Since the advent of money, scientists studying it still cannot give an exact answer to what the essence of money is. But almost everyone agrees that the essence of money is manifested through its functions, which express its internal content. There are five main functions of money: a measure of value, a medium of circulation, a means of payment, a means of accumulation and savings, and world money. But in the modern interpretation, other functions of money are also recognized: measuring value, introducing a price scale; a means of purchase or a means of exchange, these functions essentially characterize the main property of money - servicing commodity circulation. The third function is a means of payment, which ensures a significant improvement in market relations itself, as well as promoting the spread of monetary relations outside the market sphere. As we see, the modern interpretation of functions differs slightly from that given by scientists earlier. The logical relationship between the essence of money and its functions is obvious. We can say that the essence of money is primary, and the functions are secondary. Therefore, the ongoing modifications of the functions of money must be considered based on an analysis of the essence of money. Due to the fact that the essence of money was understood differently by both modern scientists and scientists of the past, the presentation of issues relating to the functions of money is also ambiguous. There are different opinions regarding the number, interpretation and hierarchy of the functions of money. Hierarchy is when, when describing the functions of money as a reflection of its essence, the fundamental functions are highlighted.

The main function of money in Marxist theory and in theories of money based on its commodity origin is the function of money as a measure of value. The remaining functions of money are derivatives of the first. Another characteristic of money is its role. Representatives of all economic movements, often based on opposing positions, paid attention to the role of money. Representatives of the monetary school believed that the size of the money supply is the root cause of changes in the economy. They recognized the unique nature of metallic money, drawing a clear line between it and other means of circulation, denied the credit backing of banknotes and argued that money should be backed by gold. The banking school, in contrast to this concept, denied the independent role of money in the development of the economy, emphasized the special role of metal money signs, and tried to eliminate the difference between metal money and credit money. According to representatives of this school, banknotes should be issued only against promissory notes.

In fact, at present, discussions about money come down to the recognition of the loss of gold as a universal equivalent or the denial of this fact, the problem of the nature of modern money, and the methodology of its research. It is characteristic that, in contrast to commodity (tools, livestock, etc.) and metal (gold and silver coins) money, modern money is only a token of value, i.e. have no so-called intrinsic value. In other words, the real costs in monetary terms for the production of a modern banknote do not coincide with its face value. This means that modern money has lost its commodity form and is not only not a commodity, but also not a special, specific commodity, which gold was.

Thus, we see that money has been of interest to scientists from different countries since ancient times. Money plays an important role in the life of mankind.

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Role money V economy (2)

Course work>> Economy

Theories Coursework in the discipline economy Subject: Role money V economy Completed by: Head: St. Petersburg... " role money V economy", and also expand the concept money, their essence, functions and types, as well as their role V economy, in...

Role money V economy and social sphere

Abstract >> Banking

Functions money their role in the process of reproduction. 3. Role money V economy and... social sphere. In modern economic science generally recognized: active role money in development economy