Kepler Bb Civilization: Barter

Question

Currently payment in my Kepler Bb civilization is based on barter. Some things are free and others are paid for.

But barter has a problem. No defined unit.

So is there a way I can get a defined unit while still having the economy barter based?

Dfleymmes thinks that there should be a reason behind using barter.

Well here is the reason:

You can't expect a civilization to start right off the bat with currency. First they need technology to smith metal and make paper. They don't have that. They have the resources readily available but not the technology.

So that is why they are using a barter system.

Answer 1

By definition, no.

If you have a defined unit, in which the value of everything else is expressed, then you have a currency, and you no longer have a barter based economy.

Answer 2

The beauty of barter is that two individuals decide on the worth based on desire and need. No units of measure are required and as kingledion states, you effectively ruin the barter system by defining units of value.

Maybe you have a hybrid economy. Maybe larger contracts/transactions are purchased with defined units and smaller day to day is conducted with barter. But even then, the allure of defined units - currency - eventually destroys the barter system.

Answer 3

As others have pointed out, you can't really have that.

But you might want to take a look into what is called 'medium of exchange'. Although money as we know it is the most typical one, the term goes far beyond it.

A medium of exchange is something we are willing to accept instead of the goods we ultimately want. For your civilization, it should be something in sufficient demand, like salt, hacksilver, nails, shells, tobacco, etc. If enough people accept it, you have something that can serve as unit of accounting (incidentally that also makes it a form of money).

There is of course no guarantee that a particular medium will be accepted in other parts of the civilization. More than that, there is no guarantee that various media will be seen as similarly valuable in different places (so e.g. salt will be of less value close to the salt mines or the sea coast where it's made).

Hope that helps!

Answer 4

I commented but looks like I should post as answer, some defense for OP's system.

We are much better at counting and assign some tags for anything, then it was possible in times when barter system was a thing.

We counting expenses, material usages, energy usages for any items we producing, in such details which where not possible in old days. At level we can say not only exact consumption of everything that is used to produce something en mass, but we can say how much it costed for us to produce that particular item, and we can potentially trace it to raw ore. A bit idealized representation of reality, in some places it less difficult in some more difficult, in some impossible because they stuck in 50th years tech. But point is we are much better at counting things now then ever and it is possible to determine fair exchange.

It is possible to assign value, which we call price, without money as separate entity, so the item itself will be money, with well known "price".

Problem with barter system is lack of flexibility in therms of searching seller buyer, you can't divide items indefinitely small etc. But for large quantities it works today too. Problem of barter system is it less convenient for most people. Farmer can wait for better price and they do, by storing product this is part of production process.

But get payment for contract of programming something as example by 2y food supply at once and have store it in hope to exchange it later for something more useful, and do it before food spoils, yhea not so funny.

Although it can be solved by having some stock exchange storage's or something to solve moving and exchange of items - definitely possible, instead of banks with money, storage facilities.

So as you concern - No defined unit - not exactly true, there is defined unit - energy, raw materials. But yes, it needs lot of thinking how to make that system work better, without operating or explicitly separating that virtual unit, there have to be some ideology that keeps them from doing that.

Answer 5

First of all, why does your apparently money-less barter system need to have a single universal unit of measurement?

"If you have a defined unit, in which the value of everything else is expressed, then you have a currency, and you no longer have a barter based economy"

And why have you chosen to use a barter system? Are you just trying to come up with alternative exchange systems and economies to make the setting feel alien? I recommend figuring out the needs of the characters in your world and then creating the money system around that, rather than the other way round.

Here's an Article in the Atlantic that might give you another starting point: http://www.theatlantic.com/business/archive/2016/02/barter-society-myth/471051/

or read/ look up Debt: the first 5,000 years by David Graeber. -basically, barter systems existing before credit and currency is a myth.

If you're looking for stories-

2312 by Kim Stanley Robinson is a great story in a setting with a partial command economy in which the resources are distributed by AI systems based on need.

Also, Neptune's Brood by Charles Stross details some speculative financial instruments as part of a futuristic version of capitalism that allows slower-than-light interstellar trade

Answer 6

You can maybe use defined units that are perhaps uncommon enough or variable enough to suggest value, so that trade can be based on valuing against that thing, without needing it present to act as currency. So, knowing ten bolts of fabric versus three sacks of flour against that working but past breeding age horse, might make it easier to value this loaf of bread versus that carrying bag against each other. It isn't a static measurement, either, since the value of a horse isn't set - the standard might be based on a number of factors, including age, health, and breed, so even horses would require individual valuation and haggling (and so not be "standard currency"). Or you might pick something like spices, whose entire value is in being used (and which grow staler over time) - and so won't be hoarded for currency, especially since value differs between spices, and even between batches of the same spice (based on freshness, fragrance, and potency).

Alternatively, you can value different things as "units" or "standards" used to measure goods against each other, and the lack of a common standard will prevent it from being currency - say foodstuffs are generally valued in terms their relative value to bread, while cloth items are generally valued in relation to maybe blankets - so bargaining eggs versus an apple would have both working out value in terms of bread, while eggs versus a skirt would be looking at matching those frames of reference (how many loaves per blanket, then backtracking from there). Since, these items will not be standard. Each loaf or blanket will still be of variable worth depending on its construction, provenance, and desirability - (I'd pay that for X's loaf, not Y's, and Z's blankets are always worth more...) so still not a standard currency since not any loaf will do.

Or, you could use time as a standard measurement - since obviously, a few hours of the town''s best seamstress is going to be worth more than a casual stitcher's, and no match at all for a few hours pulling weeds - but in general the effort put into something (or its scarcity, hours put into finding it) will let things be valued against each other in a very general sense, with plenty of wiggle-room for individual valuation of that effort left to prevent it from becoming a standard currency.

You will probably want a bit of extra wiggle room, in terms of allowing favors or debts, or delayed payment, to routinely make up part or whole of the bargains being made. That gives a great deal more flexibility for trading and making the community work as a whole, when individual wants and needs don't match up at the exact right place and time. You should also be aware that most bargains will be mixed trades (a bit of this and a bit of that, and also a favor for a consideration, will be much more common than one thing for one thing).

You might want to look at gift economies, which are community oriented and work by expecting people to be generous to those in their communities, with the expectation that those they help will be generous right back (and work by favors and debts more than straight out bargains).

You might also consider how even a "standard" unit of value or currency finds value in a trading style that deals in haggling, like most barter economies would, I assume. Even if a thing has general value (ie, everyone wants it), it isn't the same thing as being a standard unit of exchange since everyone, everyone, is still going to haggle over the price of it - and so exchanges between two things are likely to be individualized and variable, even if they are both measured against a standard valuable thing, they will be measured as standard examples of that thing (and both sides arguing for their particular virtues and the other's flaws, so it isn't a simple case of mathematics).

Answer 7

The main problem with barter is that I might have what you want, but you might not have what I want.
I live in a 1 bedroom apartment, what am I going to do with 47 chickens in exchange for my couch?

To get a unit of exchange that isn't exactly money, you need to have something that is universally needed/valuable by itself.
The word "salary" comes from the Latin word for salt because the Roman Legions were sometimes paid in salt. They say the soldiers who did their job well were "worth their salt."
Salt was valuable because it's vital for human life, and difficult to make in quantity without some specialized skill.

Whether it's salt, potasium, or a regular ol' plumbus, your civilization will have something that is valuable/useful to the majority of people, but not so valuable that it can't be traded away. For instance oxygen makes for a difficult currency because if I give you all of my oxygen then I'll die.