184 MODERN MONETARY SYSTEMS 
units of other countries on a gold currency.! But this does 
not mean that the exchange value of this monetary unit in 
relation to all goods and services is nowadays determined 
by any market rate for gold, since the latter, as we have 
seen, no longer has a market rate. 
In the last analysis the idea of a standard comes down to 
that of the unit of account by which the exchange value of 
various commodities in relation to the currency, and hence 
their exchange value among each other, is measured. And 
this is the meaning which we have in mind when we attempt 
to find a suitable standard of values. A monetary unit, 
whether it circulates after being embodied in some form 
of matter or whether it is used abstractly in some form of 
accounts, is perfectly adequate as a measure of values at 
any given moment. One object is worth 10 francs, another 
20, another 30; from this observation it follows that the 
second object is worth twice the first and the third is worth 
three times the first and one and a half times the second. 
But it is commonly stated in addition that money is a 
standard which varies from one period to another ; for the 
same sum of money does not represent the same quantity 
of goods at different periods. In this form the observation 
is perhaps not quite accurate. If a hat which was worth 
5 francs before the war is worth 20 francs to-day, the 
estimate, expressed in monetary units at different periods, 
exactly expresses the difference in exchange value of the 
commodity in relation to the currency at these two periods. 
Units of currency will accurately measure this difference 
over a lapse of time. The same applies to all commodities 
and we only have to take the average price level at the two 
periods under consideration in order to measure exactly 
any change which has taken place in the exchange value of 
all commodities in relation to the monetary unit. 
1 This stable exchange ratio is not only due to the amount of gold in 
each monetary unit, but to the fact that owing to free coinage and free 
export and import the gold currency of one country is convertible ad 
Libitum in the other. This is shown by the dislocation of exchanges which 
happens between countries on a gold currency when gold can no longer 
move freely from one country to another and the currency of one can no 
longer be freely transformed into that of the other.