Various writers have defined money in other ways, some has described it in narrow sense and some has described it in broader sense. A number of the explanations are as below:
Based on Ely:
Any thing that passes easily from hand to hand as a moderate of exchange and is generally received in final discharge of debts.
In phrases of Crowther:
Any thing which is generally adequate as a means of exchange and at the same time functions as a measures and store of value.
Based on R.P.Kent:
Money is anything which will be typically applied and generally recognized as a moderate of exchange or as a regular of value.
Features of Money
The features of money can be divided into three main groups:
- a) Principal features
- b) Extra features
- c) Contingent features
Money has offered as a moderate of exchange. It’s applied to produce payments for goods and services. Various goods could be sold in terms of money and this money can be utilized to get other goods. Therefore it functions as a moderate of exchange between the buyers and the sellers.
- Standard of value:
Money is applied to measure the value of every thing in exactly the same way as we could measure weight in kilogram and distance in km. it functions as a regular of value. Goods and solutions are valued and valued when it comes to money.
- Monetary and fiscal administration:
Money is a critical factor of monetary and fiscal policies. Collection of taxes and community fund administration is only probable in expression of money. Under barter program it is difficult to gather taxes in type of goods and then to make use of the quantity of tax for developing projects.
- Income and use:
Income and use of different factors of generation is decided in terms of money. Money helps in perseverance, valuation and budgeting of costs and revenues.
In barter program specialization is extremely hard because everyone else tries for self sufficiency. Specialization not merely helps in lowering price of generation but also results in larger production. The upsurge in generation then could be traded to purchase other goods.
- Deferred payments/future payments:
The money has removed the inconvenience of potential payments. Today the loans could be obtained from banks and financial institutions. The future payments could be mentioned in terms of money.
- Economic actions:
All kinds of economics actions such as for example investments, savings, credit, improvements etc are created in expression of money. The use of money has facilitated the expansion of trade.
- Parameter of market framework:
The usage of the money provides schedule of market mechanism. The need and present are the two significant causes of market which performs just due to money. Money is the factor leading to the perseverance of prices, need and supply.
- Promote international trade:
Money has built probable the enormous international expense in today’s world. Under barter program the international expense was difficult but the utilization of money made it probable because in money economy wealth can easily be moved in one destination for a another.
- Move of wealth:
Money also serves as a mean of transferring value from destination for a place. A person may possibly sell his moveable and immoveable home fro money at one position and may use that money to purchase home at various other place.
Besides the primary and secondary operates, professor Kinley has also provided following four contingent functions.
- Distribution of national income: