🧾Why You Accept a Piece of Paper

Earliest cause at the top

1. 1

   The state names a unit and declares taxes payable in it

   The obligation is defined before any money exists
2. 2

   Everyone with a tax bill now needs to obtain some

   Including people the state never paid directly
3. 3

   Prices start being quoted in the unit

   It has become the unit of account, not just a means of payment
4. 4

   The state spends the unit into existence

   Paying soldiers, suppliers and officials puts it in circulation
5. 5

   Sellers accept it because their customers must hold it

   Demand for the unit is now general, not just from taxpayers