Money originated as commodity money made from valuable materials like gold and silver, but most modern money systems use fiat money which derives value from government decree rather than physical commodity. The document discusses different forms of money like coins, banknotes, and cash versus cashless systems. It also explores alternative economic models like bartering, gift economies, and potential future reputation economies where contributions to society determine social and economic status.

1. The World of Money

2. What is “money”?
Money is any object or record that is generally
accepted as payment for goods and services
and repayment of debts in a given country or
economy.
Money originated as commodity money
(money made from something valuable such as
gold or silver), but nearly all modern money
systems are based on fiat money. Fiat money is
money that has value because everyone agrees
that it does. The term derives from the Latin
fiat, meaning "let it be done" or "it shall be
[money]", as such money is established by
government decree.

3. Opening Discussion
• Do you care about money itself, or do you just
like spending it?
• Do you often use paper money, or do you
prefer to use credit cards and bank cards?
• What do you think the world would be like if
there was no money?

4. Bartering
Before the invention of money, people
traded things they had for things they
needed. This was called bartering.
•Do you think this is a good way to get
the things you need?
•If you had to trade things you made for
food and clothing, would you have the
same job you have now? How would your
life be different?
•Look at the men in the picture. What are
their jobs? What can they do for each
other?

5. Coins and Banknotes
The earliest type of money still in use is
the coin. Coins are small metal disks,
originally made of valuable metals.
A banknote (often known as a bill) is a
kind of money made of paper. Usually
coins are used for lower valued monetary
units, while banknotes are used for higher
values.
When money is made of physical things we
can carry around and trade, like coins and
bills, this kind of money is called cash.

7. Cashless Society
The government of Sweden recently
announced that they will soon stop making
paper money and coins. In the future, people
in Sweden will have to use credit cards and
debit cards to pay for everything. People in
Europe can also use text messages from their
mobile phones to make transactions.
•If there is no cash, will people still be able to
steal from each other? What other crimes
might be more difficult?
•Do you think your country should get rid of
cash?

8. Gift Economy
A gift economy (or gift culture) is a society
where valuable goods and services are given
without any agreement for immediate or
future rewards (i.e. something for nothing).
Long ago, many societies had a gift economy
instead of one based on bartering or money.
For example, many Native Americans who
lived in the Pacific Northwest, practiced the
“potlatch” ritual, where leaders give away
large amounts of goods to their followers,
strengthening group relations. By sacrificing
his wealth, a leader gained a position of
honor.

9. Reputation Economy
Science and technology are changing the world
every day. Some people think that in the future
machines will be able to make everything we need
for free, or almost free. What will people do if they
don’t have to work to have food and clothing and
shelter? There is a danger that if everything is
given to us, we might all become very lazy.
A recent idea on how to solve this problem is by
creating a public reputation system. For example
imagine a world where every time someone did
something good for you or made you happy in
some way, you could give them points for their
reputation score. If everyone could see everyone
else’s score people with high scores would be
“richer” than other people because everyone
would know they are generous and kind.

10. What do you think?
• Could you imagine living in a gift economy?
Do you think giving things away would be a
better way of life than buying and selling?
• Would you want to live in a world with a
reputation system? What would be good
about it and what would be bad?
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