Money as a medium of account, implies relative constants for resource values across a given spectrum of economic conditions. Think of the word medium in this context, as an agency or means of doing something. The medium of account function suggests reliable relationships for the resource aggregates which contribute to a nation's GDP. Money as medium of account, has more potential as a stabilization role than is sometimes recognized. The sum total of international tradable wealth, versus that of national non tradable wealth, can be viewed through the lens of a medium of account perspective.
However, money as a medium of account isn't highlighted in the Wikipedia definition of money, which emphasizes the medium of exchange and unit of account functions. A unit of account describes the particular forms in which given monies are currently being used. Money as medium of exchange, is what gives money "permission" to represent all other resources - a process which vastly decreased the need for barter. Regular readers may recall that I have suggested a parallel role for time value as medium of account (alongside that of money), to address what have become growing imbalances between production capacity for time based product, versus other forms of product.
Tradable sector commodities and goods have proven the easiest way (thus far) to think about monetary representation for medium of account. Durable goods and commodities are known quantities that are currently available in the marketplace, hence expected to be sold as they have in fact been generated. Since it's not difficult to quantify manufactured goods, tradable sector structure includes current nominal income factors which are relatively easy to determine.
Unfortunately, nominal income determinants have not proven as simple for knowledge based services product. This is due in part to the fact only a fraction of personal time investment presently applies (in medium of account time aggregates), toward the goal of economic access and personal production in the marketplace. Imagine for example the chaos that would occur, if asymmetric compensation were applied to the "valuation" of specific (physical) inputs of manufacturing processes - much as what occurs with applied time in today's knowledge use organizational patterns.
The result would be multiple inputs which could not be utilized in final product, hence product costs beyond final product utilization.We can see these additional costs for knowledge goods in the form of national deficits, today. This is one way to describe how non tradable sectors now contribute to overall production inefficiency, in aggregate. Difficult to discern value variance in time coordination, makes nominal income less obvious as well, for non tradable knowledge product. This could partly account for an excess emphasis on the part of central bankers, for nominal income capacity which is largely not questioned in terms of mortgage potential.
Plus, time based services product tends to be hidden within organizational structures which rely on fiscal support. Perhaps this has bearing, why some are reluctant to emphasize a medium of account role for money, as contrast with the medium of exchange role. One problem in particular stands out. Time based product is not yet a well specified quantity, and too many time aggregates (overall) remain excluded from economic coordination.
One reason a marketplace for time value would assist organizational capacity, is that coordinated time value would qualify as an understandable medium of account, for knowledge use systems. An hourly measure of time value (as a parallel medium of account), would contribute to productivity and quantitative structure in services generation. Besides the obvious gain of knowledge use management, there is the potential of better negotiation capacity for individual to group time use preferences.
Like the known quantities of goods and commodities, potential time aggregates are a relatively fixed given. Unlike present services generation which holds a partial association with time based product, time based service product at local levels can be recorded in an ongoing continuum, and quantified as an anchor for resource potential. It would be possible to calculate the characteristics of knowledge which are utilized in these settings, as well.
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