Can you imagine a world without money, without the actual notes and coins you use to buy things? Or even a credit card, since a credit card represents money you have in a bank or have borrowed from a bank. It's difficult to picture a world like that when even buying a soft drink costs money, or a very understanding shopkeeper. Yet many people feel that money causes too many problems and doing without it would make all of us much happier. To see why some people decided to do without money, we need to first see why money exists.

Money was first invented as a substitute for barter, the system of exchanges. If you needed something that someone else had, and that someone else had something you wanted, all you had to do was carry out an exchange. When everyone living in a village just exchanged things among themselves, all was well. But it didn't always work well when villages grew into towns and cities, or when people started travelling. It became impossible to carry everything you wanted to barter. Barter also didn't work if you wanted something from someone who didn't need what you had to offer.

So the next step was to use something that everyone wanted or needed because it was necessary, or difficult to get, or both. Gold was one such thing, so the cow could be exchanged for gold, which later could be exchanged for coal or wood or whatever. Gold represented the value of that exchange and was rare enough. It didn't always have to be gold; for a long time in many countries people used salt, which used to be a rarity in countries that were far from the sea. That's where the word 'salary' comes from.

But carrying gold around was a bit dangerous, so people started leaving all their gold with someone who could look after it. That person would give you a note stating that he was holding your gold. Then, if you wanted something in exchange you gave that person the note and he could either go to the person who was storing your gold and ask for it or give the note to someone else in exchange for something else he wanted and so on.

This, in fact, is exactly what money is. That note is the money. The government of any country holds lots of gold and issues notes, which we call money, to its citizens in exchange for doing work for the government. The citizens, in turn, use the notes to buy things. In fact if you look at any Indian currency note now, let's say a hundred-rupee note, you'll see there's a line that says: "I promise to pay the bearer the sum of hundred rupees." And it will be signed by a government official. But you already have a hundred rupees in your hand, so what does that line mean? It means that if you go to a government bank they have to give you a hundred rupees worth of gold. In many ways money is just an agreement of sorts, an agreement between you and the government to use something as a medium of exchange, something that acts like a note and can be traded and exchanged for other things.

Sadly, there are problems with money, especially if you are poor, because money is not just one of the things whose absence makes you poor, it is one of the things that keeps you poor. And since poor people usually live in poor areas with other poor people, money can keep a whole area poor.

This sounds odd, but money has three troublesome characteristics: because it is a medium of exchange and not the actual thing to be exchanged, if no one wants what you have to sell, but you still need what they are selling, like food (this often happens as fashions change), your money goes out but nothing comes in. If your entire village was geared towards making pottery to sell to the USA and the villagers used the money they got selling those pots to buy food, what happens when the USA suddenly decides it no longer needs your pots?

The second problem is that often you need money to make money. For example, you could decide to make money to buy food by selling the pots locally. But you would need money to build a shop, to transport your pots to the shop, to advertise, etc. So you are stuck in a cycle.

The final problem is that because it is the government that issues the money, if the government decides to change its money or the value of it everyone is affected even if it was a political decision and had nothing to do with pots or who wants to buy them.

The essential problem that people who wanted to do without money were trying to solve is that poor village communities were getting poorer because no one had money, and more and more people were leaving the communities because, since they were poor and had no money, there was no work to be done. So they would go to other communities and try and find work for money there. As more and more people who could do work left, the community got poorer and poorer. When normal money disappears, community projects are stopped, local small businesses fail because no one has the money to buy things. More and more unemployment results and the whole village goes downhill, not because no one has nothing to offer but because money has 'drained' out of the community.

The way out of this cycle was to return to barter. The point was that though not everyone has a job or a skill that can earn real money, almost everyone has a skill, an ability, or can do something that someone else needs in that community. And these skills can be exchanged. It must be kept in mind that in many places and in many situations money is not actually used anyway. We barter and swap things all the time. We say: "I'll give you 200 comic books for your bicycle," or "I'll let you ride my bike if you let me eat one of your sweets," or even "If you do your homework today we'll go out for a pizza on Sunday." So, instead of comic books or sweets, I could teach you how to ride a bicycle and in exchange you could clean my house. Or because I am stronger than you I could spend two hours digging your garden, allowing you to grow vegetables. In return you could baby-sit my kids for five hours when I need to go out. All that we would need is to decide how many hours of babysitting are equal to how many hours of digging. Now if you had someone in the village who could keep track of all these exchanges of time and skills, more and more people could get involved.

Such systems are called Local Exchange Trading Systems (LETS), involving a bunch of people who agree to provide goods and services to each other. They could produce a sort of 'directory' that lists what everyone in their community can do or are good at, while also listing what they need in return. LETS does not involve coins or paper money but is more like a 'scoring system' or a 'community information system'. Other versions of money-free employment solutions keep track of the time spent doing something for the village or someone else rather than focus on particular skills. This time spent can be recorded and credited into a sort of 'time bank'.

One of the biggest advantages of such a system is psychological. We often judge how well we are doing by how much we are worth in terms of money, how much we earn, how expensive our telephone or car is. When people are poor they feel worthless, not just because they do not have money and the possessions that money can buy, but also because they end up feeling they have nothing to contribute to society as no one is willing to give them money for what they can do.