What is money and where does it come from? Will Luther, assistant professor of economics at Kenyon College, joins the show and explains the two competing theories on the origins of money. The first theory posits governments are needed to provide credibility for money as a medium of exchange. The second theory, the spontaneous order theory, argues market actors will arrive at an acceptable medium of exchange on their own. David and Will discuss historic examples of both public and private money, including the Somali shilling and the brief use of vodka as a form of currency in Russia in the 1990s. Will also explains how Bitcoin and other forms of cryptocurrency work and how cryptocurrency may affect future macroeconomic policy. David's blog: http://macromarketmusings.blogspot.com/ Will Luther's webpage: http://www.wluther.com/ David's Twitter: @DavidBeckworth Will Luther's Twitter: @WilliamJLuther Related links: "Synthesizing State and Spontaneous Order Theories of Money" http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2140208 "The Monetary Mechanism of Stateless Somalia" http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2047494 "Regulating Bitcoin: On What Grounds?" http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2631307 "On the Origins of Money" https://mises.org/library/origins-money-0