The transition from barter economic systems to early monetary economies in Europe took place at around 700 BC. Ancient Greece (1000 BC – 323 BC) and afterwards the Roman Republic (509 BC – 44/27 BC) successfully established simple coinage systems with currencies like the denarius that already managed to fulfil the three modern economic functions that distinguish money from all other assets. In line with an ancient “free-market”-regulatory system during the early years of the Roman Empire (44/27 BC – 476 AD) the denarius subsequently paved the way for a tremendous enlargement of foreign trade, thus marking off the beginning of modern “free” trade.
On the other hand, the Romans were the first who suffered from the negative aspects and challenges of a market economy: since modern principles as social and income justice as well as price stability were fully disregarded, the Romans were facing financial inequality, hyperinflation , and cultural erosion of their “way of living”. Their fiscal and monetary policy harshly failed to finance long-term public expenditure, in particular military expenditures and imperial bribes. This imperfect competitive system is one of the main reasons for the disastrous collapse of the (Western) Roman Empire.
However, this erroneous trend cannot only be assessed for ancient market systems: inflation during the years 1914-1923 in the German Reich and Weimar Republic also showed negative economical implications of hyperinflation including intense individual suffering and social impairment. Accompanied by the Black Tuesday of 1929 the German inflation finally fuelled political extremist fractions and amplified distrust towards economic institutions and legitimate democratic authorities.
Inhaltsverzeichnis (Table of Contents)
- INTRODUCTION AND OUTLINE
- DEFINITION
- HISTORICAL OVERVIEW
- FUNCTIONS OF MONEY
- ECONOMIC MONETARY FUNCTIONS
- SECONDARY MONETARY FUNCTION
- SUPPLEMENTAL FUNCTIONS OF MONEY
- INFLATION AND ITS SOCIO-ECONOMIC IMPACT - CASE STUDY
- CURRENT DEBATE ABOUT THE EUROPEAN COMMON CURRENCY
- CONCLUSION
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This paper aims to explore the multifaceted impact of money on society and the economy, specifically addressing the research question: Which impacts does the introduction of money have on social perception and economic prosperity?
- The historical development of money and its emergence from barter systems
- The economic functions of money, including its primary and secondary roles
- The phenomenon of inflation and its socio-economic consequences
- The current debate surrounding the European common currency
- The broader implications of money on social perception and economic prosperity
Zusammenfassung der Kapitel (Chapter Summaries)
- Introduction and Outline: This chapter sets the stage for the paper, providing a brief overview of the transition from barter to monetary systems and highlighting the challenges faced by early economies. It introduces the key research question and outlines the structure of the paper.
- Definition: This chapter explores various definitions of "money" and "currency," highlighting the importance of establishing a clear understanding of these terms for the paper's subsequent discussions. It also emphasizes the different perspectives on money from economics, jurisprudence, and everyday language.
- Historical Overview: This chapter examines the historical development of money, focusing on its emergence and the theories surrounding its origin. It explores the role of trade in the development of money and discusses the "logic of the market" as a driving force behind its evolution.
- Functions of Money: This chapter delves into the economic functions of money, encompassing both primary and secondary roles. It examines the relationship between money and economic prosperity, as well as the communication aspect of money.
- Inflation and Its Socio-Economic Impact - Case Study: This chapter investigates the macro-economic phenomenon of inflation and its impact on both society and the economy of a state. It utilizes case studies to illustrate the negative consequences of hyperinflation and the challenges it poses to social stability.
Schlüsselwörter (Keywords)
The paper focuses on the concepts of money, currency, barter systems, economic functions, inflation, hyperinflation, European monetary integration, and social perception. It delves into the historical development of money, exploring its economic implications, and analyzes its impact on both economic prosperity and social stability.
- Quote paper
- Katharina John (Author), 2007, Money - the root of global trade, Munich, GRIN Verlag, https://www.grin.com/document/78719
