of the whole amount of the whole amount needed, which is brought to market at the greatest expense, and their market value is regulated by Demand and Supply (as in class 2).
If there be no free competition between industries, then the value of those commodities which has been said, in the above classification, to depend on cost of production, will be governed by the law of Reciprocal Demand.
Chapter IV. Of Money.
§ 1. The three functions of Money—a Common Denominator of Value, a Medium of Exchange, a “ Standard of Value ” .
Having proceeded thus far in ascertaining the general laws of Value, without introducing the idea of Money (except occasionally for illustration), it is time that we should now superadd that idea, and consider in what manner the principles of the mutual interchange of commodities are affected by the use of what is termed a Medium of Exchange.
As Professor Jevons220 has pointed out, money performs three distinct services, capable of being separated by the mind, and worthy of separate definition and explanation:
- A Common Measure, or Common Denominator, of Value.
- A Medium of Exchange.
3.