In my first post on money in fantasy writing, I discussed the roles money plays in economic activity as a unit of exchange, a measure of value and a store of value.
In this post, I want to talk about some of the attributes a good money must have. Foremost, whatever is chosen to be money has to have two important characteristics. It has to be accepted by the recipient and it should be available in limited quantity. The first is obvious. If the person exchanging goods or services for money doesn’t accept the money then it is of no use. We can think of arriving in a foreign country with home money. Will it be accepted by the seller? Probably not. In a story, this could lead to interesting complications for our intrepid adventurer. Hence, mutually acceptable money is an important attribute.
Personally, I don’t think writers have made enough of this problem. Generally, if the currency in use is specie based, it is assumed that the recipient will automatically accept it. But in a world where travel isn’t common or only follows predictable routes (for instance, caravan trade routes) not having local currency will lead to all sorts of complications. Of course, if the distance isn’t that great, the recipients will have some knowledge of or even use the currency alongside the local one. But if the location of the exchange is a long way from where the currency is normally used, then there can be problems.
In a partially written story, I have the protagonist arrive in Brazil with only English money. It creates a difficulty. They try to use it and it isn’t well received. Or the exchange rate at which it is accepted proves unacceptably high which will lead them to run out of money very quickly.
The second issue that needs considering is finding a type of money that is only available in limited quantity. Most writers resort to using a precious metal. Gold is a favourite, but the more value attributable to the metal, the less use of it in practice. That’s why gold, silver and base metal coins all circulated side-by-side within an economy as the old British currency system so aptly demonstrates. I’ll have more on that point in a later post.
Now there is a good reason why gold became the foundation of many currency systems. Alongside other precious metals—and silver, in particular—it has some nice qualities. Gold is one of the most malleable, ductile, dense, conductive, non-destructive, brilliant and beautiful of metals. Gold does not perish over time. Hence it has some nice physical properties. Also there is a very limited quantity of the metal and obtaining more is a laborious and costly process, which helps create its value in the first place.
Consequently, gold as a currency is often used in stories alongside silver and base metals as part of some unexplained coinage system. Very often, the use of precious metals in stories relies on our tacit understanding of the value of gold and silver compared to say bronze or copper coinage when characters are involved in buying and selling. There’s an implicit value system at work here.
Note that money doesn’t have to come in coins. The reason coins work well is that they provide an acceptable unit—generally by weight—as to what the coin’s value is. The original English currency was the silver penny which was fixed at 22.5 troy grains, which was about 1.46 grams. It was fixed at 1/240th of a troy pound, which was about 373 grams. There was a difference between the bullion value and the coinage represented a premium to the mint for turning bullion into coins.
If all parties agreed on the value of silver as a store of value and hence as a medium for exchange, then the actual nature of the coinage might not matter too much. In large transactions, then, it would be possible to weigh the coins to determine their value—and we see sets of scales and weights in paintings of Renaissance bankers for just this purpose. That would be fine for big items, but for that drink in the inn, not so much if the coin wasn’t one they were familiar with. And biting on it? No, that wouldn’t work though it looks good in movies, if weight is what mattered, what are they doing?