A Note on the Philosophy of Money

Simmel's ThePhilosophy of Money is a much neglected classic. While most of hissociological work has now been translated into English, we still lack atranslation of this seminal work. One possible reason for its neglectis the title, which could have led many to infer that this is one ofSimmel's metaphysical works. An early interpreter of Simmel in thiscountry, Nicholas Spykman, took just that view. Although this largebook does contain certain important philosophical ideas, it is mainly acontribution to cultural sociology and to the analysis of the widersocial implications of economic affairs.

Economic exchange,Simmel argues, can best be understood as a form of social interaction. When monetary transactions replace earlier forms of barter, significantchanges occur in the forms of interaction between social actors. Moneyis subject to precise division and manipulation and permits exactmeasurement of equivalents. It is impersonal in a manner in whichobjects of barter, like crafted gongs and collected shells, can neverbe. It thus helps promote rational calculation in human affairs andfurthers the rationalization that is characteristic of modern society. When money becomes the prevalent link between people, it replacespersonal ties anchored in diffuse feelings by impersonal relations thatare limited to a specific purpose. Consequently, abstract calculationinvades areas of social life, such as kinship relations or the realm ofesthetic appreciation, which were previously the domain of qualitativerather than quantitative appraisals.

Just because money makes itpossible to limit a transaction to the purpose at hand, it helpsincrease personal freedom and fosters social differentiation; moneydisplaces "natural" groupings by voluntary associations, which are setup 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 meansof exchange. Over and above its economic functions, it symbolizes andembodies the modern spirit of rationality, of calculability, ofimpersonality. Money levels qualitative differences between things aswell as between people; it is the major mechanism that paves the wayfrom Gemeinshcaft to Gesellschaft. Under its aegis, themodern spirit of calculation and abstraction has prevailed over an olderworld view that accorded primacy to feelings and imagination.

ThePhilosophy of Money elaborates on various themes Simmel discussed inother works, some of which have already been taken up in the precedingpages. However, because this work gives a fuller treatment of thesethemes than do his other writings, it is indispensable for anunderstanding of his cultural analyses and his cultural criticism.

From Coser, 1977: 193-194.

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