Money is a Token of Cooperation: The Biology of Indirect Exchanges

Abstract

I propose an objective definition of money through a biological definition of cooperation, as opposed to altruism. I argue that these types of sociality are confused because they are not evaluated from a situated perspective of animal interactions. The theory of reciprocal altruism does not correctly model the human exchange of goods and services. These constructive economic interactions require the ability to choose partners based on individual preferences. On the other hand, altruism presupposes partnership under a common standard of value. Therefore, the nature and evolution of money cannot be explained by conceptualising it as a token of indirect altruism or as a form of credit. Rather, money is a transferable signal that enables cooperative interactions between distant or unrelated individuals. This behavioural definition similarly proposes an understanding of morality and human society as strategies of indirect reciprocity in the context of game theory.

Keywords: game theory, social evolution, partner choice, morality, economics