First, it inspired more industriousness: there was now incentive to work harder to earn more in a day than you could spend in a day. Second, savings enabled ambitious entrepreneurs to make big capital investments: labor-saving machines, warehouses, transportation.
If the saver didn't have any big plans in mind for his money, he could still make it productive by lending it out. Finance was nearly impossible without money ..
.. Money also made specialization more practical. If you were really good at one thing - manufacturing nails (to borrow Adam Smith's famous example) - you could make a living just by making nails.
Without money, someone who spent his whole day making nails would have to find (a) someone with excess food who wanted nails, (b) someone with excess shelter who wanted nails, (c) someone with clothes to spare who also wanted nails at that moment, and so on. Once money is introduced, the nail seller only needs to find (a) people with money who want nails, and (b) different people with everything the nail seller needs who want money. Facilitating specialization creates efficiencies, as folks get to divide up labor according to skill and interest. In countless ways, money improves society. - in GoldSeek
Terça-feira, Junho 26, 2012
Money Improves Society
In Countless Ways, Money Improves Society: