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The myth of barter

The anthropological premise of modern economics:  as primers on economics complacently repeat – that economic life emerged from a propensity of the species to truck and barter.

But there is a myth about barter.

Adam Smith's The Wealth of Nations imagines ‘a tribe of hunters or shepherds’ among whom producers of arrowheads, tanned hides or teepees simply swap one thing directly for another. Eventually, however, economies become too complex to function like this, and so they introduce some universal commodity – salt, cowries or one or another precious metal – by means of which all other commodities can be exchanged.

Graeber rejects this creation myth of homo economicus on two grounds. Not only does it mistake the origin of commercial money, which lies in credit and debt rather than exchange, it also mischaracterises the economic behaviour of earlier societies. The anthropological literature offers no evidence of barter as a central economic practice prior to money, but does furnish endless documentation of societies that distribute what we now call goods and services without drawing up accounts or expecting that such accounts, were they kept, could balance exactly or be closed.

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