Note 300 — Chapter XIII

Theorie der wirtschaftlichen Entwicklung, p. 77. Since the foregoing was written, Professor W. C. Mitchell has presented an admirable historical paper on "The Rôle of Money in Economic Theory," in which he has multiplied instances, in the history of the science, of this contempt for money, or abstraction from money, in economic theory. He finds that Marshall, and some other later writers, have given much fuller recognition to the rôle of money, which he conceives of primarily as an institution which has rationalized economic behavior, by forcing upon the individual bookkeeping habits of thought. This still leaves it legitimate to abstract from money, however, for "pure theory." Highly important as is the "measure of values" function, it does not explain the main work which money, as money, actually does in economic life, nor need it be a source of value for money. Cf., infra, our chapter on "The Functions of Money." Professor Mitchell's paper will be found in "Papers and Proceedings," Supplement to the March, 1916, number of the Am. Econ. Rev.