Quote from: myrkul on May 08, 2013, 07:47:01 PM

Quote from: johnyj on May 08, 2013, 07:37:32 PM

In this case, there is no money involved, the consumption ends when I ate the lunch and his children ate the apples, nothing left, no futher economy activities

Except the $10 he didn't have to spend at the market for apples got spent elsewhere, creating economic activity.

Money is just grease for the gears of commerce. They still move if you're bartering, just less smoothly.

Suppose this $10 is the only money in the whole system

The purpose of my experiment is to study the difference between currency and general goods/services, not from a user perspective, but rather from a currency maker perspective (why making currency is different than making other general goods/services)

So far some points:

1. Currency will never get consumed, so they will not disappear from the economy. General goods/services will get consumed and disappear from circulation, so they need to be produced continuously

2. The currency depreciate slowly while general goods/services depreciate quickly, so the currency works as a store of value. This is maybe the most important difference, anything with value that lasts longer than currency should be able to work as a currency to exchange value (gold is such a good currency since it almost never depreciate, while silver is not so stable, could be oxidized)

3. The economy activities are driven by currency, not demand. People have all sorts of demand, but unless they get currency first, they will not easily get their demand fulfilled, even others have the product they want， their product might not interest others. In today's society most of the goods/services can only be purchased with currency, not through barter. This had some influence on people's behavior, they use the currency as a standard measurement of value