Why is gold so valuable? Is it really as simple as “ohhhh pretty rock make shiny things”?
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Well at first is was very easy to work with as it has a low melting point but aside from that it has great electrical conductivity. So it’s used in almost all electronics
It was that simple for much of history, yes.
In more modern times, gold has found a number of important industrial applications, because it’s pretty nonreactive (nice if you don’t want things to corrode) and conducts electricity and heat very well.
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Pretty much, yes. It *does* have important industrial uses in addition to being shiny, but not enough that those would be able to drive the prices up anywhere near as high.
We value it because we can make pretty things with it, and humans are willing to pay a lot of money for pretty things. Pretty things are status symbols, and status symbols are valuable.
Gold is hard to fake.
If I give you a chunk of metal and it reacts or corrodes it isn’t gold.
If you hammer it very thin and it shatters, It isn’t gold.
We can weigh and measure volume consistently and agree that it has a common value.
We can rely on it to symbolize the work that went into getting said gold.
We can then spend the rest eternity arguing over how much work it should take to be the equivalent of mining an ounce of the stuff.
Note that there is a lot of “we” going on here.
If you have no way to spend a gold ingot, a paper dollar, or a digital monkey picture, the item becomes useless. See Subway Tokens, Arcade Tokens in the age of swipe cards, and gift certificates to K Mart.
Some good answers here already, I will take a stab.
Gold is chemically boring. It does not react with many other elements, making it naturally stable.
This stability is great for trade, gold is gold, make into a coin and its literally worth its weight in gold.
It has great electrical and thermal properties for industrial applications.
For jewelry, it keeps its luster over time and its relatively easy to work with to craft fine jewels.
With today’s technology, its easier to find and refine, but historically, gold was difficult to extract.
Walter Huston in the Treasure of the Sierra Madre, gives a great explanation why gold is valuable:
“A thousand men, say, go searchin’ for gold. After six months, one of them’s lucky: one out of a thousand. His find represents not only his own labor, but that of nine hundred and ninety-nine others to boot. That’s six thousand months, five hundred years, scramblin’ over a mountain, goin’ hungry and thirsty. An ounce of gold, mister, is worth what it is because of the human labor that went into the findin’ and the gettin’ of it.”
Granted, gold’s scarcity and properties give it an intrinsic value, but we as a society determine how much we are willing to pay for it.
Something people are forgetting is that gold doesn’t age like other metals. Doesn’t tarnish like silver, or rust like iron. Makes it very useful to have.
Also it’s incredibly easy to work with to the point where if you don’t combine it with other metals it will deform.
Partly because it’s rare. Things that are rare have value. That’s sort of the logic behind BitCoin as well.
Anything that is in limited quantities is presumed to have value. The more limited, the more valuable.
At one time aluminum was as [valuable as gold.](https://medium.com/discourse/why-napoleon-iii-served-dinner-on-aluminum-instead-of-gold-782196a92ef0) Napoleon was really fond of it. Today its used to make disposable cans. What happened?
Well, we discovered a process for extraction that make it easier to get aluminum. It was more abundant than previously thought (or at least could be obtained) and the value dropped.
Gold isn’t that abundant in nature and it is still relatively difficult to extract. So it is still valuable. Prior to modern industrial means it showed up naturally along water sources as a natural buildup similar to how other minerals that get dissolved build up over time. Not all water sources have these deposits and, those that do, get used up pretty quickly once people start grabbing it.
So, yes. Pretty. But also hard to come by and in limited quantities.
Gold is (relatively) rare, but universally appreciated. Gold is (relatively) easily worked. Gold does not tarnish and it does not deteriorate. Gold cannot be faked, which is a big deal for ancient value systems. Gold is valuable both as a medium to make decoration, and also is valuable as a piece of art. In the modern era, there are also industrial applications for it, which further drives its value.
Of all the things people have appreciated since ancient times to modern times, gold is one of the easiest sells.
Gold is very easy to work with, doesn’t tarnish or rust. It’s rare and somewhat easy to confirm it’s actually gold and not something that looks like gold.
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