1. Why studying emergence of money?
    1. The question that inspired this work was:
      1. what about having more than one form of money circulating?
        1. Are there examples of really different kinds of money?
          1. Smuk is King
          2. “In inmates’ eyes, the organization of prison life is premised on the action of smoking; when cigarettes are taken away those social forms break down and men withdraw from contact with each other” (42)
          3. cigarettes govern every action; they are a fetish object
          4. “The fetish object is not animated by something foreign to it – human intention or social meaning – but by a spirit that seems its own. That spirit is not held to reside in matter, but rather it appears as the spirit of matter” (41)
          5. Psychological colors of money
          6. contrary to a naive view, money still brings with it the color of its provenience.
          7. Black money, illegally acquired, must be “laundred”;
          8. an unexpected windfall may end being treated differently from a bonus or an inheritance, even if the sums are equal [Zelizer1989Social]
        2. Did I answer that question?
          1. No.
          2. But some of us had to look into the literature of money emergence.
    2. We all know what money is; there's nothing as obvious and as engraved in our everyday life.
      1. Now, being a cultural construct - an artefact - means that, again unlike food or sleep, we can ask some theoretical questions about money
  2. Previous Work
    1. Running a research of simulative models of money emergence, I found a much much lower number of papers than I expected.
      1. Models by game theorist use 3 (three?) different goods - Kiyotaki and Wright 1989
      2. Between simulation models, the classic seems to be Yasutomi (1994)
        1. Some other went out in recent years - but oversimplified
          1. One with multiple monies but only by spatial constraints
        2. Others recent ones are difficult to retrieve
          1. There is an interesting (and inaccessible) one using "double networks"
  3. Replication of Yatsutomi's simulation
    1. Why?
      1. Bruce Edmonds and David Hales (2003): Replication, Replication and Replication
    2. What is the basic idea of the model?
      1. Agents produce one kind of good and want another.
        1. They barter only when they are randomly matched - a double coincidence of wants, which is unlikely to happen even with small numbers (50 agents in Yasutomi's paper)
        2. So, a "wanted" vector is introduced in which the agents keep track of goods that have been requested but they were unable to offer.
          1. Example of a desired vector
        3. If a value gets over a fixed threshold, then that good gets accepted for exchange.
      2. Results
        1. Money emerges for a range of threshold values.
  4. Results by topology
    1. Full connection
      1. Figures
        1. time of money emergence
          1. zoom of the same
    2. Random topology
      1. Figure
        1. opt
          1. consumption
    3. Star topology
      1. Figure
        1. opt
          1. consumption
    4. Preferential attchment network
      1. figures
        1. Opt
          1. consumed
  5. Conclusions
    1. Another characteristic of social networks: they may be the ideal place to allow money to emerge from barter.
    2. Can we stretch the model to something else? Like exchange of ideas?
    3. Yasutomi showed a nice model of money emergence with a fully connected topology. Relaxing this assumption we found that
      1. If we simply use a random network, we see faster convergence on one exchange item as money - but also a greatly depressed volume of exchanges.
      2. A special shape like the star-shaped network shows this in the extreme - money emerges quickly and predictably, but the volume of exchanges never flares up.
      3. Scale free networks share both characteristics of having a preferential point and a higher connection level; from the simulations in this paper, they seem to be an ideal compromise between the star network and the random - exchanges are systematically higher and money emergence stronger than with their network counterparts.
      4. So, inverting the point of view, maybe there is another reason that we have so many scale free networks in the social world - because scale free networks allow for both quick convergence - coordination - and volume of exchange.