Della Moneta: The Pure Theory of Money

The Chap. 4 tackles the work of Galiani’s precocious genius, Della Moneta, with a detailed description of his contribution to monetary theory. In particular, the chapter describes the money as an institution based on trust and the theory of value, in the light of a manuscript version of the treatise. Galiani’s theory of value was certainly the highest point reached in the theoretical elaboration of eighteenth century Italian writers. The analysis of Della moneta’s manuscript has made it possible to define Galiani’s theory of value as a synthesis of subjective elements (utility) and objective elements (scarcity, and thus labour and nature), or more precisely, it presents itself as the result of the development of two traditions, the scholastic (utility-scarsity) and the nascent hedonistic utilitarianism (of which uncle Celestino himself was a forerunner in Italy). The same compromise between different traditions of thought emerges with the theory of interest, in which advanced developments in the calculus of probability are embedded in an approach that still contains ethical concerns. But the ground on which Galiani emerges from his century is certainly the pure theory of money: the Neapolitan abbot rejects vulgar metallism, distinguishing between the logical nature and the historical specification of money and attributing to the latter the character of a social institution, based on confidence and consensus. The metallic form that money takes has only a contingent cause, historically determined by the degree of confidence, and is not a logical necessity.