Money

The sociology of money is a new and thriving field. Significant theoretical contributions to a sociological understanding of money were made by Marx, Simmel, and Weber, among others. While Weber focused primarily on the legal status of money – he broadly agreed with Knapp's characterization of money as a “creature of the state” – Marx and Simmel undertook extensive investigations into the nature of money as a medium. According to Marx, money is a commodity, and its quantitative relationship to other commodities – its function as a “universal measure of value” – is made possible by the amount of labor‐time that it contains. This is true not only of precious metals but also of other forms of “credit” money, such as banknotes, which derive their value from a commodity such as gold. Thus, to view exchange relations merely as “monetary” relations or as a series of prices determined by supply and demand is to overlook the social relations of production – and, of course, exploitation – on which they fundamentally depend. Simmel took a quite different view of the value of money. By his reckoning, money represents an abstract idea of value that is underwritten by “society”: its value, in other words, ultimately depends on a form of trust in society that Simmel likened to “quasi‐religious faith.” On the basis of the characterization, Simmel explored the roots and consequences of the development of the “mature money economy,” whereby an increasing number of social relationships are mediated by money.