[OPE-L:2407] commodity money in Marx's theory

Costas Lapavitsas (CL5@soas.ac.uk)
Wed, 29 May 1996 09:09:34 -0700

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Riccardo Bellofiore wrote [OPE-L 2405]

> My
> point is a theoretical one: is not a money commodity system simply a
> limiting case of extended barter?

Not really. A money commodity system is the supersession of
barter. There is a qualitative difference between the two which
general equilibrium has some difficulty in capturing.

>is not in the nature of money to be a
> final means of payment precisely excluding barter and mere bilateral
> credit?

Money as means of payment does not exclude barter, on the contrary it
allows direct exchange of commodities among capitalists, settling
any differences in equivalence. This is common practice in
contemporary international trade. Money as means of payment, on the
other hand, makes bilateral credit possible rather than exclude it.

>is not money commodity something which must be capistically
> produced, and hence financed?

Yes, but why should this have any bearing on the determination of its

>I would here revert the argument which goes
> from money commodity to valueless money. I would rather side with
> Schumpeter, saying that logically the credit money is prior to the money
> commodity, though historically the process *may* go on in the other
> direction - BTW, there are a lot of studies who question even this.

Many others have argued this, including Hicks, and, as Allin Cottrell
[OPE- l 2404] also pointed out, Wray in recent years. Marx's theory
of credit, as we know, is a monetary one. This, it seems to me, is an
advantage in analysing capitalist financial crises, including
recent ones. What we do observe as a 'stylised fact' is a rush
away from debt and toward money, and though the form of money has
changed the essence of the phenomenon has not - IOU and commodities
are not enough, only money will do.