EconPapers    
Economics at your fingertips  
 

Digitization and the evolution of money as a social technology of account

Michael Peneder ()

Journal of Evolutionary Economics, 2022, vol. 32, issue 1, No 7, 175-203

Abstract: Abstract Throughout the history of monetary thought, economists have predominantly emphasised the function of money as a medium of exchange along with the intrinsic properties that enhance its salability and credibility as the most liquid store of value. But the social institution of money co-evolves with technology. It is significant that the advent of digital crypto-currencies was initiated by computer scientists and has taken economists completely by surprise. As a consequence, it also forces our profession to rethink the basic phenomenology of money. In accordance with the views of Wieser and Schumpeter, digitization brings to the fore the immaterial function of money as a standard of value and social technology of account, which increasingly absorbs its function as a medium of exchange. The potential impact of this on economic policy is huge. The variety of different crypto coins has proven the technical feasibility of competing private currencies as proposed by Hayek. In the long term, however, there is reason to doubt the persistence of intense competition. One must fear that major digital platforms will extend their current dominance in multisided virtual market places to include digital payments and money. Central banks are increasingly anxious to preserve public sovereignty over the common unit of account and are considering issuing their own digital fiat money. After the current era of intense creative experimentation, the potentially new spontaneous order of private crypto-currencies is likely to be supplanted by central bank digital currencies (CBDCs), the design of which will depend on deliberate public choices and policies.

Keywords: Digitization; Evolution of money; Currency competition; General ledger; Crypto coins; Central bank digitial currency (CBDC); Austrian economics (search for similar items in EconPapers)
JEL-codes: B26 B53 G28 O11 O16 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s00191-021-00729-4 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
Working Paper: Digitization and the Evolution of Money as a Social Technology of Account (2021) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:joevec:v:32:y:2022:i:1:d:10.1007_s00191-021-00729-4

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/191/PS2

DOI: 10.1007/s00191-021-00729-4

Access Statistics for this article

Journal of Evolutionary Economics is currently edited by Uwe Cantner, Elias Dinopoulos, Horst Hanusch and Luigi Orsenigo

More articles in Journal of Evolutionary Economics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

 
Page updated 2022-09-10
Handle: RePEc:spr:joevec:v:32:y:2022:i:1:d:10.1007_s00191-021-00729-4