The Theory of Money and Credit - Ludwig von Mises [53]
The value of the materials that are used for the manufacture of fat money and credit money is also influenced by their use as money as well as by all their other uses. The production of token coins is nowadays one of the most important uses of silver, for example. Again, when the minting of coins from nickel was begun over fifty years ago, the price of nickel rose so sharply that the director of the English mint stated in 1873 that if minting from nickel were continued the cost of the metal alone would exceed the face value of the coins. [19] If we prefer to regard this sort of use as industrial and not monetary, however, it is because token coins are not money but money substitutes, and consequently the peculiar interactions between changes in the value of money and changes in the value of the monetary material are absent in these cases.
The task of the theory of the value of money is to expound the laws which regulate the determination of the objective exchange value of money. It is not its business to concern itself with the determination of the value of the material from which commodity money is made so far as this value does not depend on the monetary, but on the other, employment of this material. Neither is it its task to concern itself with the determination of the value of those materials that are used for making the concrete embodiments of fiat money. It discusses the objective exchange value of money only insofar as this depends on its monetary function.
The other forms of value present no special problems for the theory of the value of money. There is nothing to be said about the subjective value of money that differs in any way from what economics teaches of the subjective value of other economic goods. And all that it is important to know about the objective use-value of money may be summed up in the one statement—it depends on the objective exchange value of money.
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[1] See Böhm-Bawerk, Kapital und Kapitalzins, pp. 211 ff.
[2] See Walsh, The Fundamental Problem in Monetary Science (New York, 1903), p. 11; and in like manner, Spiethoff, "Die Quantitätstheorie insbesondere in ihrer Verwertbarkeit als Haussetheorie," Festgaben für Adolf Wagner (Leipzig, 1905), p. 256.
[3] See Rau, Grundsätze der Volkswirtschaftslehre, 6th ed. (Leipzig, 1855), p. 80.
[4] See Böhm-Bawerk, op. cit., Part II, p. 275. And similarly in Wieser, Der natürliche Wert, p. 45; "Der Geldwert und seine Veränderungen," Schriften des Vereins für Sozialpolitik 132: 507.
[5] See Böhm-Bawerk, op. cit., Part II, pp. 273 ff.; Schumpeter, Wesen und Hauptinhalt der theoretischen Nationalökonomie (Leipzig, 1908), p. 108.
[6] Wieser, Der natürliche Wert, p. 46.
[7] Ibid., p. 52.
[8] Böhm-Bawerk, op cit., Part II, pp. 214 f.
[9] See Helfferich, Das Geld, 6th ed. (Leipzig, 1923), pp. 301 f.
[10] Thus Schumpeter, op. cit., p. 109.
[11] See Böhm-Bawerk, op. cit., Part II, p. 217.
[12] See Wieser, "Der Geldwert und seine geschichtlichen Veränderungen," Zeitschrift für Volkswirtschaft, Sozialpolitik und Verwaltung 13 (1904): 45.
[13] Thus even as late as Menger, Grundsätze der Volkswirtschaftslehre (Vienna, 1871), p. 259 n; and also Knies, Geld und Kredit (Berlin, 1885), vol. 1, p. 323.
[14] See Simmel, Philosophie des Geldes, 2d ed. (Leipzig, 1907), p. 130.
[15] But, as a general rule, objects of art, jewelry and other things made of precious metal should not be regarded as constituting part of the stock of metal which performs the function of commodity money. They are goods of the first order, in relation to which the bullion or coined metal must be regarded as goods of superior orders.
[16] See Wieser, "Der Geldwert und seine geschichtlichen