Does the money's "Store of value" function actually exists?

Question

I'm aware of the following four functions of money:1. Medium of exchange.2. Measure of value (in dollars, pounds, etc.)3. Standard for exchanging goods (guaranteed by the Fed)4. A Store of value (as an asset).AFAIK, the last one didn't exist according to Classical Economists, but only John Maynard Keynes brought it later in his theory.I want to understand whether this function really exists? I'm more inclined to agree with the Classical Economists - I've created a simple analogy to understand this. Suppose there is a small village where there are N residents who trade only in barter. Now, you introduce a new bank in the village called Banko and a currency called pebbles. (For simplicity, lets assume that Banko is both a central bank and also lends/borrows money).Now in order to leave barter and migrate to currency system, the villagers will have to either sell their goods to Banko, or borrow pebbles from them. So, there is a "give and take" or *exchange* of pebbles against goods.But at the end of the day, if you consider the **overall macro-economic position**, the pebbles made no difference in *value* at all. The villager's *NET ENDOWMENT* is same as it was before, the pebbles just facilitate transactions and used to count their assets now.So, my question is, if money doesn't make any difference to the REAL value of goods and services, how can it be considered an asset?

Answer 1

Store of value means "over time". In your Barter economy if some of the products are Perishable (ice cream, fish, Bread, etc. ) they melts or start to smell or get stale and can't be used for much in transactions except instantaneously. Wheat could be stored and used for later transaction and may command some kind of a premium in its price as it can be a store of value. However, if next period there is a bumper crop you can lose purchasing power. Money absolutely does serve as a store of value and the primary role of the central bank is to preserve the purchasing power of the currency..