You can buy items by exchanging an item you have but no longer want or need. Generally, trading in this manner is done through Online auctions and swap markets. The history of bartering dates all the way back to BC. Introduced by Mesopotamia tribes, bartering was adopted by Phoenicians. Phoenicians bartered goods to those located in various other cities across oceans.

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Goods were exchanged for food, tea, weapons, and spices. At times, human skulls were used as well. Salt was another popular item exchanged.

In the Middle Ages, Europeans traveled around the globe to barter crafts and furs in exchange for silks and perfumes. Colonial Americans exchanged musket balls, deer skins, and wheat.

The History of the Trade and Barter System

When money was invented, bartering did not end, it become more organized. Due to lack of money, bartering became popular in the s during the Great Depression. It was used to obtain food and various other services.

It was done through groups or between people who acted similar to banks. Just as with most things, there are disadvantages and advantages of bartering. A complication of bartering is determining how trustworthy the person you are trading with is. The other person does not have any proof or certification that they are legitimate, and there is no consumer protection or warranties involved.

The History of the Trade and Barter System

This means that services and goods you are exchanging may be exchanged for poor or defective items. You would not want to exchange a toy that is almost brand new and in perfect working condition for a toy that is worn and does not work at all would you? It may be a good idea to limit exchanges to family and friends in the beginning because good bartering requires skill and experience.

At times, it is easy to think the item you desire is worth more than it actually is and underestimate the value of your own item.

Barter Economy

On the positive side, there are great advantages to bartering. As mentioned earlier, you do not need money to barter. Another advantage is that there is flexibility in bartering. For instance, related products can be traded such as portable tablets in exchange for laptops.

Or, items that are completely different can be traded such as lawn mowers for televisions. No exchange was possible, if the double coincidence of wants was not there.

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In the absence of common unit, proper valuation was not possible. In barter system, it was difficult to return value in future in terms of goods of same quantity and quality.

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Therefore, future , payments regarding interest and loans became difficult. Storing of goods carried some problems like cost of storage, loss of value, transfer from one place to other, etc. So, in case of commodities, it was difficult for people to store their purchasing power.