THE NOTION OF MONEY 16§
Finally, the important point for the recipient of a certain
sum of money, or in other words of a certain number of
units of account, is not that he is entitled to a certain
quantity of precious metal for which he would have no
direct use; what does matter to him is the assurance that
in the event he will obtain in exchange for the number of
units of account which stand to his credit that quantity of
commodities to which he is entitled by that sum of money
considered in the abstract.
Thus in proportion as the notion of money develops it
becomes gradually more and more detached from that of a given
quantity of a given commodity and becomes a notion of a unit
of account with a given purchasing power. Not until a doubt
arises as to the permanence of this purchasing power
does the idea of a currency commodity reappear. We do
not believe that it is psychologically correct to say that
before the war the public accepted bank-notes because it
knew that they were convertible into coin. Only persons
with technical knowledge and bankers cared about this;
the man in the street only needed to be convinced that
when he parted with his note it would bring him, not a
certain amount of gold, but that quantity of goods which
he knew he could obtain in exchange. A preference for
gold only made itself felt owing to doubts as to the stability
of the purchasing power of paper and not really because
gold is a commodity, but, more exactly, because it is a
universal currency which is everywhere accepted, pro-
duced in limited quantities and therefore certain to main-
tain its function as an instrument of exchange with a
comparatively stable purchasing power. It is doubtless
true that its quality as a commodity, i.c., as a material
object capable of other uses and therefore able to retain
an exchange value independent of its monetary uses,
may greatly strengthen a currency. In the first place,
through being commonly used by a large number of
countries, it may more easily become an international
currency. Further it cannot be produced arbitrarily and
in unlimited quantities. But, in our view, the idea of a
commodity is not necessarily inherent in that of money
and we believe that money is more accurately defined as
