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Amwelladmin (talk | contribs) (Created page with "{{a|banking|}}{{d|Barter||n., v|}} In the absence of a common framework for exchange of abstract value, the exchange of one good or service for another. In a particularly entertaining passage is particularly entertaining book, {{br|Debt: The First 5,000 Years}}, the late {{author|David Graeber}} addresses the commonplace wisdom that fiat currency grew out of a system of barter between “savages”. Not only is the necessary widespread “double coincidence” of needs...") Tags: Mobile edit Mobile web edit |
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Where there is evidence of barter was between strangers, and groups between whom trust was low: rival tribes in Papua New Guinean rainforests, shiploads of Her Majesty’s finest colonial oppressors, trading rifles, blankets and influenza for sweet potato, flightless birds and sovereignty. | Where there is evidence of barter was between strangers, and groups between whom trust was low: rival tribes in Papua New Guinean rainforests, shiploads of Her Majesty’s finest colonial oppressors, trading rifles, blankets and influenza for sweet potato, flightless birds and sovereignty. | ||
Money being a only of any use within a community of trust — I say this on | Money being a only of any use within a community of trust — I say this on the hoof, ''[[res ipsa loquitur]]'' and without supporting evidence or argument, but it is hard to see anyone accepting a promissory token offered by a stranger in any other circumstances. | ||
Barter is, therefore a local maximum: the best one can do ''in a bad situation, where there is a lack of trust''. Risk is minimised by restricting exchange to a pre-negotiated swap of goods. (Not goods or ''services'', because acquiring services in exchange for goods (or services) requires ''trust''. | |||
“I understand exactly what I am giving and what I am getting. This is delivery-versus-delivery, at no point am I exposed to this counterpart whom I do not trust.” | |||
We reduce the usual scenario of commerce, [[iterated prisoner’s dilemma]] where game theory predicts that provisional trust is the optimal strategy, to a discrete single rounds with ''no'' dilemma. Trust may develop through repeated interaction, but need not. A relationship of “hostile barter” can exist indefinitely, and between adjacent warring factions often does. | |||
Where trust does arise, those practical limitations of barter dissolve. Should there be no “double coincidence” one can say to the other, “send the bearskins now, and I will deliver you the arrowheads next week. I memorialise my promise on this written pledge.” | |||
This pledge we recognise as an IOU. Banking lawyers, who never use one word when two will do, would call it a [[promissory note]]. | |||
Something new has happened here: in trusting the arrow maker, the furrier has acquired a new kind of asset: a token representing the promise to deliver arrowheads in the future. This the furrier can keep and present to the arrow maker, but I can also ''sell'' it. She needs arrows now, another merchant has some spare, she will give me hers in exchange | |||
{{Sa}} | {{Sa}} | ||
*[[Bitcoin]] | *[[Bitcoin]] | ||
{{br|Debt: The First 5,000 Years}} | {{br|Debt: The First 5,000 Years}} |