Money in relation to worldbuidling [part 1]
Now when I have your attention, let’s have some theory here! I will not try to load you with all stuff from university economics course, but we will go over the basics. I hope it may help some of you in real life too.
We all use money for many things but, have you ever thought, what exactly are they? Money is an item or verifiable record that is generally used to get for goods, services and pay debts.
Simple, right? Now, as well as many other things in the world money have functions. Which are:
This is the basic function of money as a valuable good. Basically it means that you can exchange money for things or services and the other way round. Or even money for money.
Measure of value.
Different kinds of goods are equal and share with each other on the basis of prices (exchange rate, the cost of these goods, expressed in the quantity of money). Product price performs the same measurement function as the length of intervals in geometry or mass of the bodies in physics. You don’t really need to know what space or weight is to make a measurement, an ability to compare the desired value with the standard will be enough. Currency unit is a standard for the goods in our case.
Medium of circulation
Money is used as an intermediary to handle the goods. This function is crucial ease and speed with which money can be exchanged for any other commodity (liquidity). When you use the money commodity producer is able, for example, to sell the goods today, and buy raw materials only after day, week, month and so on. In this case, he can sell his goods in one place and buy the required ones in another. Thus, money is a means of overcoming the temporal and spatial constraints in the exchange.
- Instrument of payment.
The money is used for registration and payment of debts. This function takes an independent value for situations unstable commodity prices. For example, some goods were bought on a credit. The amount of debt expressed in money, not in the amount of purchased goods. Subsequent changes in the price of goods have no effect on the amount of debt to be paid in cash. Money performs this function when we have monetary relations with financial authorities. Money plays the similar role when any economic indicators are expressed in them.
Storage of funds.
Money, that is accumulated but not used, allows a transfer of purchasing power from the present into the future. Storage means function is performed by money that doesn’t participate in the money circulation. However, keep in mind that the purchasing power of money depends on inflation.
Money functions as a universal means of payment, the universal means of purchase and universal materialization of social wealth. World money is usually considered reserve currencies. For direct cross-border payments money from different countries can be used.
Now when you know what money is and what is their function, let’s move to more practical things.
What amazes me quite often and not in good way, is how fantasy writers treat metallic money. People just don’t understand that you can’t go around throwing gold and silver like they are nothing but banknotes. Why so? You see, back in days things were different. But before I move to explanation why it’s an atrocity, let’s have a brief look on the history of money.
Money not always and not everywhere were, you know, coins made of metals. Hence our next thing to discuss: commodity money. It’s a type of money whose value comes from a commodity of which it is made. They consist of objects that have value in themselves, as well as value in their use as money. Things that have been used as mediums of exchange include gold, silver, copper, bronze, gems, salt, peppercorns, tea, large stones (such as Rai stones), decorated belts, shells, alcohol, cigarettes, cannabis, candy, cocoa and coffee beans, cowries, barley, animal pelts, cattle, bird feathers, carved bones and many others.
As a matter of fact, commodity money is to be distinguished from representative money which is a certificate or token that can be exchanged for the underlying commodity, but only as the trade is good for that source and the product. A key feature of commodity money is that the value is directly perceived by the users of this money, who recognize the utility or beauty of the tokens as they would recognize the goods themselves. That is, the effect of holding a token for a barrel of oil must be the same economically as actually having the barrel at hand.
Representative money is something that is not in the physical form of currency, but represents the intent to pay money. For example, paper check from a bank. The check is not a physical piece of money, but it implies the intent to repay.
Ok, done here. Now in relation to worldbuilding you - most
likely- will deal only with commodity money. Unless you have chosen a time
period, when paper checks and alike are already in a widespread use. Such as 19th century or
1950s, for example.
So now, I think you’ve made your mind with physical parameters of your setting, done with geography, flora, fauna and more or less sketched a couple of cultures. So probably, you have also set your mind on how and where your OCs are going to travel or at least where they buy food and clothes and weapon and other things. Or where they steal all the things, if that’s the case.
Now, ask yourself – do the money my OCs use are coins? Shape doesn’t have to be round and flat. This one actually came from the fact that first it was easier to make a metal rod and then cut it into little round slices. Russian rubles, for example, are called so exactly because this is how they were made. Ruble literally means “a cut-off piece”.
Shape can be anything you want. Round with
a hole in the middle, as in traditional Chinese money – it’s easier to carry it
around. It can be shaped as their sacred animal (detailed or not) or a
horse-shoe shaped like West African manilla. Basically, anything you want. So
feel free to go wild. I will touch this more next time.
Now, remember what I have said about throwing around gold and silver ?
Okay, let’s apply common sense here:
1. She might get herself in trouble – people might simply steal stuff from her, because fools and money part their ways fast. She can get herself killed in the worst scenario.
2. People who throw money around attract attention and this is not what you want if you are on the run.
3. She will look like spoilt brat literally bragging “look at how much money I can spend on a simple porridge, you filthy peasants” in the eyes of the local population or even her party. Don’t know what is worse.
didn’t do the bloody research.
So for the sake of simplicity, let’s have a look at some prices in England and France. Money goes as follows:
· 1 pound = 20 shillings (s)
· 1 crown = 5 shillings
· 1 shilling = 12 pence (d)
· 1 penny = 4 farthings
· 1 mark = 13s 4d
During the Medieval period, the major type of food consumed was cereal, such as wheat, corn, maize and so on, with meat and fish being relatively expensive and thus, more scarce. We can determine that the average annual consumption of cereals worked out at 300kg per person, or 1200kg for the average family of four. We also know the average number of working hours available annually, and with these two pieces of information it becomes easy to work out average wages - if we know food prices.
· England 1320 160kg cereal cost 37 shillings
· France 1339-69 100kg of cereal cost 50 shillings
Thus in England the minimum hourly wage had to be 1.75 pence. Similarly in France it would be 2.5d. In most cases of course this food would have been grown by the family themselves, or in the case of labourers in cities provided by their employers. On top of this, there would almost certainly have been a payment in cash; to the farmer this would have been in the form of extra crops for barter. Such pay merits would probably have been on a similar scale to that suggested next:
· Unskilled Labourer Ѕd/day 3Ѕd/week
· Skilled Labourer 1-2d/day 7-14d/week
· Skilled Craftsman 3-6d/day 14-42d/week
This gives an average conjectural weekly wage as follows:
· Unskilled Labourer 15ѕd 21d
· Skilled Labourer 19-26d 24-31d
· Skilled Craftsman 34-54d 38-59Ѕd
Those persons who are self-employed would have to pay for their own food as
well as making a bit extra if possible out of their profits.
I mean, why would anyone in their right mind pay money that can be used to buy a ton of stuff for a simple room in a tavern and some shitty meal?
Okay, I hope I made this part clear. We will talk about designing money and working monetary relationships into your setting in the next part.