Photo by Jason Leung

The late 19th century saw economists, mainly German and Austrian, create a mythology of money’s origins that is still repeated in today’s textbooks. Money is said to have originated as just another commodity being bartered, with metal preferred because it is nonperishable (and hence amenable to being saved), supposedly standardized (despite fraud if not minted in temples), and thought to be easily divisible—as if silver could have been used for small marketplace exchanges, which was unrealistic given the rough character of ancient scales for weights of a few grams.[1]

This mythology does not recognize government as having played any role as a monetary innovator, sponsor, or regulator, or as giving money its value by accepting it as a vehicle to pay taxes, buy public services, or make religious contributions. Also downplayed is money’s function as a standard of value for denominating and paying debts.[2]

Although there is no empirical evidence for the commodity-barter origin myth, it has survived on purely hypothetical grounds because of its political bias that serves the anti-socialist Austrian school and subsequent “free market” creditor interests opposing government money creation.

Schurtz’s Treatment of Money as Part of the Overall Social System

As one of the founders of economic anthropology, Heinrich Schurtz approached the origins of money as being much more complex than the “economic” view that it emerged simply as a result of families going to the marketplace to barter. Surveying a wide range of Indigenous communities, his 1898 book, An Outline of the Origins of Money, described their trade and money in the context of the institutional system within which members sought status and wealth. Schurtz described these monetary systems as involving a wide array of social functions and dimensions, which today’s “economic” theorizing excludes as external to its analytic scope.

Placing money in the context of the community’s overall system of social organization, Schurtz warned that anyone who detaches “sociological and economic problems from the environment in which they emerged… their native land… only carries away a part of the whole........

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