Economics and Philosophy

Articles

WHAT IS MONEY? AN ALTERNATIVE TO SEARLE'S INSTITUTIONAL FACTS

J. P. Smita1, Filip Buekensa2 and Stan du Plessisa3

a1 University of Stellenbosch

a2 Universities of Leuven and Tilburg

a3 University of Stellenbosch

Abstract

In The Construction of Social Reality (1995), John Searle develops a theory of institutional facts and objects, of which money, borders and property are presented as prime examples. These objects are the result of us collectively intending certain natural objects to have a certain status, i.e. to ‘count as’ being certain social objects. This view renders such objects irreducible to natural objects. In this paper we propose a radically different approach that is more compatible with standard economic theory. We claim that such institutional objects can be fully understood in terms of actions and incentives, and hence the Searlean apparatus solves a non-existent problem.

(Online publication January 18 2011)

J. P. Smit is a Lecturer at the University of Stellenbosch. He has published on meta-ethics and on externalist theories of reference. His current research interests are in semantics and the philosophy of economics.

Filip Buekens lectures in the philosophy of language at the Universities of Tilburg (the Netherlands) and at the Catholic University of Leuven (Flanders, Belgium). His recent publications include work on disagreement, the explanatory role of the concept of truth, and applications of Searle's theory of institutional facts.

Stan du Plessis is a macroeconomist at the University of Stellenbosch in South Africa where he is a Professor in the Department of Economics and an economist at the Bureau for Economic Research. He is the president of the Economic Society of South Africa and formerly treasurer and secretary of the African Econometric Society. He was a member of the ‘Harvard group’ of local and international economists who advised government on policy reform since 2006. His research has focused on monetary policy and the business cycle but he has also written on the economic impact of the FIFA World Cup, fiscal policy, economic growth, the exchange rate, institutional economics and law and economics.