We should add the term money to oeo-social

[han-f]

Description of the issue

Money is used to exchange commodities, no matter if these are physical, energy-flows, financial, services .. .

Ideas of solution

Money is a universal medium for exchange
Money is also a commodity for storing exchangeable wealth.

Work along "An ontology of economic objects", Gloria Zuniga (1999).
https://mpra.ub.uni-muenchen.de/5566/1/Ontology_of_Economic_Objects.pdf

Workflow checklist

• I discussed the issue with someone else than me before working on a solution
• I already read the latest version of the workflow for this repository
• I added this issue to the Project 'Issues'. If suitable, I add it to further Projects.
• The goal of this ontology is clear to me

I am aware that

• every entry in the ontology should have a definition
• classes should arise from concepts rather than from words

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

Couple of thoughts on this, because they are an issue for IAMs (and probably some ESMs as well):

• money comes in different currencies
• exchange rates vary over time
• besides market exchange rates (MER), there's also purchase power parity (PPP), which is used in some contexts
• the value of money changes over time through inflation (and possibly deflation)

So "money" strongly depends on spatial and temporal classifications.

[han-f]

Thanks for these thoughts that go beyond money as a medium for exchange. I wonder whether we could start defining money very generically as a medium for exchange first (this issue).

An then add further terms to the ontology that follow up on more specifics (which go along with money as a medium of exchange)?

So for example we could define: Money (either physical or virtual) is a medium for exchange.

And then determine what further definitions we need.

Further food for thought:
Money can be expressed in different currencies . An exchange rate helps to translate from money expressed in one currency to money expressed in another currency. Exchange rates can be determined based on different methods (MER, PPP). Inflation/deflation describes an increase/decrease in the price of commodities.

@jannahastings: what do you think about the thoughts above? I have marked bold these terms for which I think we may need further definitions based on @0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q thoughts.

[jannahastings]

This is an important and broad topic.

From an ontological point of view, money is a dependent entity. It is a complex dependent entity as it partly depends on social entities and partly on physical entities.

Money is the bearer of economic value, which may be realised in economic exchanges.

Money is in some sense a generically dependent entity that has different concretizations (e.g. paper money, electronic money, coins, etc.)

In Barry Smith's 'Toward an Ontology of Commercial Exchange', he defines 'act of payment' as "act of payment=def. social act in which one party transfers an amount of money to another party, wherein the agent relinquishes ownership thereof and the other party acquires ownership thereof." They go on to write "In modern commerce, the transfer of ownership is frequently assisted with instruments of payment such as cash, check, or electronic transfer. Such instruments are documents (a subclassof IAO:information content entity) which are specified as having some monetary value relative to some unit of currency. These documents can be concretized in metal (coins), on paper, or in computer systems. In the metal and paper (money) cases there is an independent document entity which is an amount of money which can be used to buy things with (can be transferred in an act of commercial exchange). In the computer system case the pixels on a screen or the electromagnetic excitations on a server merely represent money." (italics added).

As per the discussion above, we should distinguishing different sorts of entity:

• A portion of money, e.g. $10
• A concretization of a portion of money, e.g. a $10 note
• A currency, e.g. dollars
• A price, which is a specification of a quantity of money that a good or service is available for exhange for
• The social and legal institutions, organisations and entities that define and regulate money

Some of these entities are defined in FIBO, we should also look there for inspiration? E.g. currency.

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

Definition:

Money is a generically dependent continuant that measures economic value and is defined by a numeral (the amount) together with a currency and a currency base year.

Description:

The currency base year establishes the year on which the value of money depends, and which is independent from the point in time at which value is measured with money.

• class 'money' with two attributes:
  • currency [either alphabetic or numeric ISO 4217 code, (I prefer alphabetic)]
  • currency base year [integer]

Energy system models care neither about how payments are made, nor how money is made, so we don't need the "concretization of a portion of money" or " social and legal institutions, organisations and entities that define and regulate money".

[stap-m]

This is highly related to #342.

I wonder whether we could start defining money very generically as a medium for exchange first (this issue).

Money is a generically dependent continuant that measures economic value and is defined by a numeral (the amount) together with a currency and a currency base year.

I guess your suggestions fit for "portion of money".
I agree that generically dependent continuant seems suitable, since it can vary its form of "concretizations"
(even when we don't implement them). @jannahastings could a generically dependen continuant in this special case also be a "bearer" of a specifically dependent continuant, as economic value might be? Or would we need an independent continuant instance anyway?
I am not an economic expert, but a measure of economic value sounds rather like price (index) than money.

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

I am not an economic expert, but a measure of economic value sounds rather like price (index) than money.

A price is the relation of economic value (measured in money) to the quantity of something else (the good). The price of electricity may be expressed in €/MWh. 17 MWh of electricity would than have an economic value of seventeen times the price – measured in € (money).

[han-f]

I think economic value is not necessarily equal to the price price paid/asked.
And to make things even more complicated (but not necessarily more complicated for our definition): the economic value a thing has may be viewed differently from different perspectives (say from the perspective of an individual firm, or from society as a whole). But this may not matter for us right now in trying to find a proper definition of money.

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

An additional attribute scale would come in handy.
Million, billion, and trillion $/€/<currency> are common, but billion and trillion are ambiguous (short v. long scale). Possibly some energy market models may want to denote e.g. electricity prices in cents/kWh_el. I think our model notes investment costs for some technologies in 1'000 of $ somewhere. Other models may want to denote lakh.
So I think an integer order of magnitude (10ⁿ) works best.

[han-f]

Coming back to the beginning, I wonder whether as a "foundation" we could define money as:

Money is a universal medium for exchange
Money is also a commodity for storing exchangeable wealth.

And then work along FIBO to get more specific, e.g. start to define amount of money which is according to FIBO: a sum of money. With the editorial note: This is an actual sum of money, not the measure of a sum of money in monetary units, although it has the same basic properties (decimal number with a currenct unit).

If this approach would be suitable, we could leave the definition of money very generic and add further issues for specification. The first one would then be for amount of money.

[han-f]

oeo dev meeting 14
We decided that we do not need this term as price, cost and currency suffice for our purposes.

[stap-m]

I can participate.

[han-f]

Thanks @stap-m !
@0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q - it would be super, if you could now set up a date-finder for all those who would participate, so we can move forward (I think that would be @litotes18, @stap-m, @jannahastings, @0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q, @han-f ). I also think it would be super if you could then walk us through the meeting as this was kind of initiated by issue #867. In the smaller meetings we had previously we simply walked along the different terms and took them one by one - and we already have a pad which can help walk us through. https://etherpad.wikimedia.org/p/money-related-things

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

@litotes18, @stap-m, @jannahastings, @han-f poll is up: https://terminplaner4.dfn.de/KFASKlPpTlLVm4zx, covering this and next week.

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

Kinda expected to be notified about participation by terminplamer4, which didn't happened. That's what you get for using copy-cats...
In any case, Monday October 18th 13-15 is our meeting.

[han-f]

I can make a Teams appointment in case Teams works for all of us (@jannahastings, @stap-m , @litotes18 , @0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q ) ?

[jannahastings]

I can make a Teams appointment in case Teams works for all of us

Should be OK for me :-)

[litotes18]

works for me as well. Ulrich Von: Hannah ***@***.***> Gesendet: Mittwoch, 13. Oktober 2021 10:24 An: OpenEnergyPlatform/ontology ***@***.***> Cc: Frey, Ulrich ***@***.***>; Mention ***@***.***> Betreff: Re: [OpenEnergyPlatform/ontology] We should add the term money to oeo-social (#335) I can make a Teams appointment in case Teams works for all of us ***@***.***<https://github.com/jannahastings>, @stap-m<https://github.com/stap-m> , @litotes18<https://github.com/litotes18> , @0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q<https://github.com/0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q> ) ? — You are receiving this because you were mentioned. Reply to this email directly, view it on GitHub<#335 (comment)>, or unsubscribe<https://github.com/notifications/unsubscribe-auth/AJ5P3CIFD5EYLA77PFHT67TUGU6YJANCNFSM4MKO5OJQ>. Triage notifications on the go with GitHub Mobile for iOS<https://apps.apple.com/app/apple-store/id1477376905?ct=notification-email&mt=8&pt=524675> or Android<https://play.google.com/store/apps/details?id=com.github.android&referrer=utm_campaign%3Dnotification-email%26utm_medium%3Demail%26utm_source%3Dgithub>.

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

My success rate for getting on Teams calls so far was below 20 %. Anything that rules out DFNconf?

[han-f]

I am fine with DFN, but cannot organise it, can you please do it?

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

Sure.

[han-f]

I am not sure I know which DFN room to visit coming monday.

[0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q]

Let's use this one:
https://conf.dfn.de/webapp/#/?conference=979170486

[han-f]

In the meeting on October 18 we (@0UmfHxcvx5J7JoaOhFSs5mncnisTJJ6q , @stap-m , @jannahastings and @han-f ) derived the following definitions:

• purchasing power parity: see A new term for Purchasing Power Parity #867

• inflation rate:

  • draft definition: ratio between the monetary price for a good/commodity at two different points in time that equalises differences in monetary price levels between these two points in time
  • parent class: ratio

• exchange rate:

  • Definition: Ratio at which one currency can be exchanged for another
  • Comment: The ratio at which one can exchange one currency for another can differ over time therefore it is necessary to specify a time point when referring to an exchange rate.
  • Example: The exchange rate between USD and EUR on March 15, 2020 was X.X.
  • Alternative term: market exchange rate

• system cost (originates from Missing terms for economic agent-based modelling #839)

  • Definition: total costs of a system
  • parent class: cost

• electricity price (originates from Missing terms for economic agent-based modelling #839)

  • Definition: monetary price per energy unit of electricity
  • parent class: monetary price
  • comment: has unit some "currency per energy unit"
  • Example: the current monetary price for electricity is Y EUR per megawatt-hour

cc @litotes18

[han-f]

And we also thought it would be good to add the following to the definition of currency:

• Comment: Currency is the unit of monetary value as defined by each country.
• Example: The currency used in France in 2020 was Euro.

[stap-m]

While implementing it occured to me that, instead of having ratio as parent class for inflation rate, exchange rate and PPP, economic value (subclass of quantity value) might be the right place, in addition to the axiom has unit some ratio. @jannahastings @l-emele ?

[l-emele]

I agree that the mentioned concepts are subclasses of economic value and ratio is the unit of these concepts.