Review of the attitudes of Georg Simmel in his work "The Philosophy of Money"

Georg Simmel: The Philosophy of Money

Besnik Fetahu

Abstract

This article will review the attitudes of George Simmel in his work “The Philosophy of Money”. Will be treated his analysis to the social meaning of money. A special emphasis will be given to his view on the effects of money and their role in society. The author will interpret why Georg Simmel believes that in every society, the role of money is on personal. On what base consist his idea that money create link between people and that these relationships take institutional form? According to Simmel, money promotes a rational calculation of human activities. Is this typical for rationalism?

Keywords: money; exchange; society; individualism; interaction.

Simmel, has been a major contributor to European sociology. His most famous work is “Philosophy of Money” (1907). Simmel, has built his own view based on the ideas of Durkheim, Marx's, Hegel's and Kant's. His analysis of social structures, city, currency and modern society is similar to Durkheim's analysis, the problem of the individual and society is similar to Weber's work on the effects of rationalization. Simmel's work on the symbolism of money is similar to Marx's work on alienation. However, what makes it distinct Simmel's work by mentioned theorists, is its emphasis on social interaction at the individual and small groups level, because for Simmel, “the society is composed of interactions between and across individuals, and that sociologists should study the patterns and forms of these associations, which is better than the search for social laws."(Farganis, page: 133). Simmel's writings on the city and money, continue to be used by contemporary sociologists.

People think about money as coins and banknotes that enable you to buy goods and pay services. However, from the sociological perspective, money is much more. For example, an anthropologists Mary Douglas, defines money as: extreme and specialized type of ritual. While the philosopher Schopenhauer, says that money is human happiness in the abstract. The economist Adam Smith, saw money as the work, while Leo Tostoy called them "new form of slavery and terrible." The Holy Catholic, will say that the love of money is the "root of all evil." The economist John Keynes, said that the accumulation of money for self-interest is pathological disease. Marx argued that the use of money in the right way has the capacity to be "a radical level" of inequality, but also as a "foreign entity" that dominates, to which people are subjected. He believed that the system of money made people needed. However, Georg Simmel see money as "freedom." In his Philosophy of Money, he explores the social meaning of money and treats money as a symbol. He looks at some of the effects of money and their symbolism for people and society in general. According to Simmel, in every society, money is made on personal or objective measurment the value. The transition from the economy of exchange to the economy of money, marks a shift in public relations and social interactions. The use of money in society, enables the personal relationship between strangers on issues of substantial value or importance on those days. Acording to him "the exchange function as a direct interaction between individuals, will be crystallizes in the form of money as an independent structure" (Simmel 1900/1990: 175 quoted by Craig, page 153). Money creates connections and obligations between peoples and institutionalized relations with the use of coins, banknotes and contracts as a bank account. For example, relations of dominance and dependence become quantitative relationship for an individual who has more or less money - their status is on personal and rationally numerable. The use of money prevents individuals from things and provides the means to overcome this distance. Also, allows a much greater flexibility for individuals in society, like traveling in greater distances, to accumulated as many as possible symbols by their validity, ownership or status and to overcome personal limitations.

For Georg Simmel, the use of money in economic exchanges, always has to do with the individual who chooses to sacrifice something in order to optimize a desired thing. He believed that every social action is exchange action. Therefore, social interaction is the exchange of representations or symbols (money). According to Simmel, philosophical meaning of money within the practical world represent the safe figure and high formula of which personificate all beings, according to which things make sense through each-other and have their existence through their mutual relations. (Simmel, 1900/1990: 128-9, quoted in Craig, p. 152-3).