In this episode of But Why we visit a credit union to learn what money is all about and Slate Money hosts Felix Salmon, Anna Szymanski and Jordan Weissman answer questions about why money plays such a big role in modern society. How was money invented? Why can't everything be free? How do you earn money? Why don't kids go to work? How was the penny invented? Why are dimes so small?
There's no first person we can point to who invented money. The idea of money has evolved as human society got more complicated. In the early days of humankind, people mostly bartered. Bartering is essentially trading.
But over time people realized they needed to have a system for dealing with things when there wasn't an easy trade. If you have something I want but I don't want anything you're offering because I really need something else, how do we work it out? That's where the earliest forms of money emerged. First they were things like shells or rocks. Then pieces of clay with symbols or faces pressed into them. These things don't have much value by themselves, but if everyone agrees that they're going to use them as a symbol of value, you can trade them and start a system of payment.
Eventually these objects became more formalized, turning into coins and paper dollar bills, like the ones we use today. These days there's another method of buying and selling: the credit or debit card.
Click listen to hear the episode and get answers to all of our money questions.