Money

From Thermal-FluidsPedia

Prior to the invention of money, trades were conducted by bartering – the direct exchange of goods and services for other goods and services. A shoemaker could exchange his shoes with a teacher who could tutor his children, or a tailor for a pair of pants. A housewife could borrow meat from a butcher, cook it and keep some for her family while delivering the rest to feed the butcher. In a small village with a handful of artisans, bartering was highly efficient.

Although bartering worked in feudal societies where only a limited number of products and services were available, it was largely ineffective in larger towns where a great variety of goods and services were needed. As societies grew and more goods and services were available, the number of exchanges became exceedingly large, and bartering became less attractive. With the invention of money, the need for direct exchange was eliminated, as individuals and businesses found a common unit of measure and value that could be exchanged for any number of products and services. Money also facilitated contracts for future activities and payments.

References

(1) Toossi Reza, "Energy and the Environment:Sources, technologies, and impacts", Verve Publishers, 2005

Further Reading

Colander, D. C., Economics, 3rd E., Irwin-McGraw-Hill, 1998.

Bosselman, F., Energy, Economics and the Environment, Second Edition, Foundation Press, 2005.

Energy Economics, Science Direct Elsevier Publishing Company. Publishes research papers concerned with the economic and econometric modeling and analysis of energy systems and issues.

External Links

United States Association for Energy Economics (http://www.usaee.org).

International Monetary Fund (http://www.imf.org).

The World Bank (http://www.worldbank.com).