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Money can be recognized as a technological development comparable to the wheel and of similar antiquity. Among the more recent developments in the technology that facilitates transfers of utility (in the sense of game theory) are systems like those of EZ Pass, by means of which vehicles traversing toll bridges or toll highways can pay their toll fees without stopping for the attention of human personnel manning the toll booths. In this lecture, I present remarks about the history of monetary systems and about issues of comparative quality or merit, along with a specific proposal about how a system or systems of "ideal money" might be established and employed. In addition, I criticize the Keynesian psychology in relation to the history of the influence of Keynesians on the practical characteristics of national currencies.
1. Introduction
The special commodity, or medium, that we call money has a long and interesting history, and since we are so dependent on our use of it and so much controlled and motivated by the wish to have more of it or not to lose what we have, we may become irrational in thinking about it and fail to be able to reason about it like we do about a technology, such as radio, to be used more or less efficiently. Therefore, I wish to present the argument that various interests and groups, notably including Keynesian economists, have sold to the public as a quasi doctrine that teaches, in effect, that "less is more" or that (in other words) "bad money is better than good money." Here we may recall the classic ancient economics saying called Gresham's law: "The bad money drives out the good." This saying of Gresham's is of interest here mainly because it illustrates the old, or "classical," concept of bad money, which is not in line with the thinking of Keynesian economists.
2. Money, Utility, and Game Theory
In the sort of game theory that is studied and applied by economists, the concept of utility is very fundamental and essential. Von Neumann and Morgenstern (1953) give a notably good and thorough treatment of utility in their book on game theory and economic behavior. The concept of (mathematical) utility does indeed predate the book of Von Neumann...