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How would a money management system emerge from a free market? Explain this please. Show that it is the case. Cite 1 example, 1 study, 1 anything to back it. More is better but just start with one.
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A money is a market commodity who some smart fellow realizes is more easily exchanged than what he has produced. If he can exchange his goods for this more readily exchanged good, the value of his own goods and his ability to get what he wants have both gone up. There is a snowball effect in the market, and a few commodities will rapidly become moneys, and will become valuable as a medium of exchange (in addition to whatever uses they already served in the market). Market moneys compete against each other, and ultimately there are usually only one or two. Historically there have been many moneys, including salt, sugar, seashells, tin, etc. but ultimately gold won out (with a few places still using silver) in the 19th century. The reasons that gold makes a good money is that it is durable, easily divisible, hard to counterfeit, and has a high value to weight ratio.
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From my
On Capitalism post.