Fiat money can best be described as money given value by government, which in any other case would have no value at all. According to Freeman, anyone who desires a good can simply acquire fiat money, by work or other means, and exchange it for what they want. He believes fiat money to be easy to deal with and easily valued amongst both consumers and producers. He goes on to say “Fiat money can be a useful medium of exchange in this economy because the government has the ability to print pieces of paper that are noncounterfeitable and costless to hold, count, or transfer” (144). Freeman describes a scenario between different islands and the different costs and efforts that each island must expend in order to communicate with the other. He makes the case that because fiat money holds no transfer cost, it is easily traded between islands instead of other means of trade in which one island may demand more of something they want than what the other island wants (139-140). This method seems to be the preferred method between Nations (islands) in today 's
Fiat money can best be described as money given value by government, which in any other case would have no value at all. According to Freeman, anyone who desires a good can simply acquire fiat money, by work or other means, and exchange it for what they want. He believes fiat money to be easy to deal with and easily valued amongst both consumers and producers. He goes on to say “Fiat money can be a useful medium of exchange in this economy because the government has the ability to print pieces of paper that are noncounterfeitable and costless to hold, count, or transfer” (144). Freeman describes a scenario between different islands and the different costs and efforts that each island must expend in order to communicate with the other. He makes the case that because fiat money holds no transfer cost, it is easily traded between islands instead of other means of trade in which one island may demand more of something they want than what the other island wants (139-140). This method seems to be the preferred method between Nations (islands) in today 's