Quote from: deisik on May 05, 2015, 05:18:17 AM

Quote from: johnyj on May 05, 2015, 01:05:31 AM

Quote from: deisik on May 04, 2015, 10:09:02 PM

You could just say that the money has no value by itself, and the money an individual has represents the amount of goods that he can have. Thereby you can exclude money out of the equation completely and would lose almost nothing from the picture. If we consider value as utility, then money has some utility to us by and of itself, since it gives us the possibility to choose what to buy (and what not) as well as postpone buying altogether. Whether this utility abides by the law of diminishing marginal utility (i.e. diminishes with the amount of money an individual has) remains to be seen...

Personally, I don't think that it does, therefore there is room for doubt about the nature of this utility

I think it does, but since money can purchase almost everything, and human's demand are so many, you are actually asking wether diminishing marginal utility applies to all the human's demand added together. That is much more complicated than asking the same question for a single utility like bread or milk

You didn't understand my point. I am not talking about people's unlimited demands or their needs. I mean the utility of money over barter (i.e. not the utility of things that can be bought with money). With barter you don't have as many options as with money. What you have for exchange may quickly deteriorate, other people may not be interested in that, you can't postpone consumption, and so on...

In this way money is not an abstract imaginary concept in the sense it is meant in this topic

Ok, I guess you mean the utility of enable transaction. Money indeed brings much more convenience than barter, but I think that the utility of transaction itself does not have any value, since it is some kind of knowledge. When it is discovered, it become free for everyone to use, it can be duplicated endlessly, you just need to find enough people to agree on one or several transaction medium

If you are living in a total barter society, the invention of money will increase the commercial activities a lot, thus bring great value. But in today's society, when the technology is already available, more types of money will not create more value (That's definitely diminishing marginal utility). Fiat money has lost the ability to store value in a relatively long time, thus some other type of money like bitcoin might come to replace its place in this specific area. But overall there are only 2 utilities of money: Enable universal transaction and maintain purchasing power for a long time