Georg Simmel was born in Berlin in 1858 and wrote this about money in 1900.
Economic exchange, Simmel argues. can best be understood as a form of social interaction.
When monetary transactions replace earlier forms of barter, significant changes occur in the forms of interaction between social actors.
Money is subject to precise division and manipulation and permits exact measurement of equivalents.
It is impersonal in a manner in which objects of barter, like crafted gongs and collected shells, can never be.
It thus helps promote rational calculation in human affairs and furthers the rationalization that is characteristic of modern society.
When money becomes the prevalent link between people, it replaces personal ties anchored in diffuse feelings by impersonal relations that are limited to a specific purpose.
Consequently, abstract calculation invades areas of social life, such as kinship relations or the realm of esthetic appreciation. which were previously the domain of qualitative rather than quantitative appraisals.
Just because money makes it possible to limit a transaction to the purpose at hand, it helps increase personal freedom and fosters social differentiation; money displaces “natural” groupings by voluntary associations, which are set up for specific rational purposes.
Wherever the cash nexus penetrates, it dissolves bonds based on the ties of blood or kinship or loyalty.
Money in the modern world is more than a standard of value and a means of exchange.
Over and above its economic functions, it symbolizes and embodies the modern spirit of rationality, of calculability, of impersonality.
Money levels qualitative differences between things as well as between people; it is the major mechanism that paves the way from Gemeinshcaft to Gesellschaft.
Under its aegis, the modern spirit of calculation and abstraction has prevailed over an older world view that accorded primacy to feelings and imagination.
Simmel’s The Philosophy of Money is a much neglected classic.
While most of his sociological work has not been translated into English, we still lack a translation of this seminal work.
One possible reason for its neglect is the title, which could have led many to infer that this is one of Simmel’s metaphysical works.
An early interpreter of Simmel in this country, Nicholas Spykman, took just that view.
Although this large book does contain certain important philosophical ideas, it is mainly a contribution to cultural sociology and to the analysis of the wider social implications of economic affairs.