Money as the Ability Vis-à-Vis Other Concepts

The chapter analyses the relationship between money as the ability and the other theories, namely the commodity and credit theories of money. The chapter demonstrates that money identified as the ability to obtain goods and services from others encompasses both theories, and it also explains transactions not explained by any of these theories. The chapter sheds some light on the process of development of modern commodity money. However, a commodity money is only money due to the existence of some other mechanisms allowing that commodity holders to have the ability to obtain goods and services from others. Similarly, a credit money is money as it allows the holders to obtain goods and services from other people. The chapter provides several examples of money that can be explained neither by commodity or credit theories.