eli5, how does a society transition from a bartering system to a centralized currency?

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I remember learning about bartering in some elementary school, but it didn’t occur to me to ask until now. How the heck does a society collectively agree that “mm yes these metal circles equate to cows”? Does the government just give everyone 100 shmeckles and let supply and demand cover the rest?

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Anonymous 0 Comments

Instead of trying to barter, I dunno, clothing for cows, you barter your clothing for *silver*, and then your silver for cows.

Then the transition to coins is pretty simple – it’s just a pre-measured-out specific amount of silver.

This I think is the disconnect for you – until *very very recently* in human history, “these metal circles” didn’t represent some vague idea of “value” in the *abstract* – they had value because they were *literally* worth their weight in silver (or gold or copper), because that’s what a coin ***was*** – a specific amount of silver or gold or copper, measured by weight.

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