Trust as a Key Variable of Sustainable Development and Public Happiness: A Historical and Theoretical Example Regarding the Creation of Money

15 Pages Posted: 12 Feb 2014

See all articles by Nicola Genovese

Nicola Genovese

University of Messina - Department of Economics

Maria Grazia La Spada

University of Messina

Date Written: February 10, 2014

Abstract

This article purports to trace the origin of money on the basis of factors in interpersonal relationships, affecting a sustainable development and public happiness, namely trust, reciprocity and the concept of we-rationality. Both the historical approach and the one based on traditional economic theory have been found inadequate mainly because they did not take into account these factors. The hypothesis expounded in the paper is that these values underlaid the beginning of economic activity. Initially economic activity was carried out within small human groups. In such groups interpersonal relations were not based on individual self-interest. As a matter of fact, there is historical evidence supporting the notion that the first exchanges were gift-giving and were made possible by trust and reciprocity as expounded by Polanyi (1957) and Sudgen (2000) among others. When the exchanges strengthened between elements of various groups all with the same values and moral characteristics the process toward the creation of money started, without any intrinsic value and the presence of any superior authority. In the paper it is also hypothesized that the creation of money is one of the basic factors in the progress of economic and social activity, together with ancient phenomena as language ad writing. Finally, the paper advocates that in future the economic activity be permeated by those moral values on which a sustainable development can be based. This will, in turn, increase the rate of economic and social growth.

Keywords: Sustainable Development, Public Happiness, Origin of Money, Behaviour Economics, Exchanges Between Primitive Populations

JEL Classification: Q01, A13, B15, E40

Suggested Citation

Genovese, Nicola and La Spada, Maria Grazia, Trust as a Key Variable of Sustainable Development and Public Happiness: A Historical and Theoretical Example Regarding the Creation of Money (February 10, 2014). FEEM Working Paper No. 10.2014. Available at SSRN: https://ssrn.com/abstract=2393318 or http://dx.doi.org/10.2139/ssrn.2393318

Nicola Genovese (Contact Author)

University of Messina - Department of Economics ( email )

Via T. Cannizzaro 278
Messina, 98122
Italy

Maria Grazia La Spada

University of Messina ( email )

Piazza Pugliatti, 1
Messina, 98122
Italy

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