Institutionalist Theories of Money

For a long time, books were the medium of diffusion favoured by researchers seeking to expound their approaches and their findings. The book format enabled authors to unfold their ideas gradually, to debate the arguments advanced by their contemporaries and to situate themselves precisely relative to their predecessors.

In keeping with the dual nature of the monetary relationship, crises may take on two polar-opposite forms: the resurgence of either centralising or fragmenting trends. Both also upset the fragile balance that the hierarchised system has brought about. But, contrary to what a casual inspection might suggest, the two processes are not symmetrical.

Economists bear particular responsibility when it comes to money. More often than not, the other specialists of the human and social sciences, not just historians of trade and finance but numismatists, sociologists, psychologists, philosophers, semiologists, political scientists, jurists and so on, all adhere spontaneously to an economic interpretation of monetary phenomena. At the core of all these various disciplines, economic reasoning is generally used to account for both the workings of monetary instruments and the ways and means by which they arise and develop.

This book endeavours to throw light on the phenomenon of money in general in an essentially comparative and therefore concrete way and not from a universalist, dogmatic and abstract standpoint. To do this, it apprehends monetary relations within the particular society to which they belong.

The way in which we conceive of society is a product of our own individual experience, which in turn is shaped by our social relations. The inextricable duality of individual and society takes the most diverse forms over time and in space. One may very well have doubts as to the possibility of constructing a general model of the social bond. However, it is difficult to be satisfied with the extreme fragmentation of the depictions of it that the various disciplines have to offer.

When analysing any social phenomenon, encounters among different social science disciplines and fields of investigation dispersed over time and space may well produce illusory rapprochements. Such encounters nevertheless have great potential for producing truly common knowledge. In matters of money, they provide an incentive to perceive money as a virtually universal phenomenon, while pointing up a considerable diversity of monetary instruments, uses and representations, without there necessarily being any continuity within that diversity.

Money is a social invention that goes far back into human history; its trace can be found in most societies, however constituted and organised, and whether or not they form states. It is not a specific feature either of modern capitalist societies or of the way the West evolved towards that modernity. The study of money requires us, then, to break away from the traditional conception that reduces it to its use as an economic instrument for market transactions. Based on an interdisciplinary approach, this chapter aims at elucidating what can be called the nature of money. To define it, we first distinguish between the generic properties of every money and its different and not specifically monetary uses. Then currency is grasped through its three functional forms—account, monetisation and payment—which are reproduced by their dynamic looping. Further we examine the three states in which a currency can be observed—embodied, objectified and institutionalised—and the way each of these states generates a particular form of monetary trust—methodical confidence and hierarchical confidence. Finally, correlating the two preceding points of view, we outline two of its features which most of the time are discarded: value is granted to a money only in the societal environment where it functions as a cultural capital; as an operator of societal totalisation, money, save in periods of crisis, allows the distributive—social and territorial—dimensions of every monetary regime to be concealed.