Money allows for increased specialization and division of labor . Any individual can go to work for any employer, receive an income in the form of money, and then spend that money in any market at any time. Money facilitates borrowing and lending . Contracts for principal and interest are written in money terms. Both parties know exactly what the future value of the contract is.
Money simplifies the investment process .
The introduction of money gives government a uniform tax basis for levying and collecting taxes. In a functional monetary production economy, money circulates through the real sector to create employment and income. In a dysfunctional monetary production economy, some money circulates to buy capital sinks . M 2 V 2 P 2 Q 2 Capital sinks include land, objets d'art, sacred cows, relics, and underground activities like prostitution, drugs, and gambling. Capital sinks do not create income and employment.