If you’ve ever swapped one of your toys with a friend in return for one of their toys, you have bartered. Bartering is trading services or goods with another person where there is no money involved. This type of exchange was relied upon by early civilizations. There are still people within modern society who rely upon this type of exchange. Bartering has been around for a very long time, and it is still very useful till today.
What is a Barter System?
A barter system is an old method of exchange. This system has been used for centuries and long before money was invented. People exchanged services and goods for other services and goods in return. Today, bartering has made a comeback using techniques that are more sophisticated to aid in trading; for instance, the Internet. In ancient times, this system involved people in the same area, however today bartering is global. The value of bartering items can be negotiated with the other party, easily. Bartering doesn’t involve money which is one of the advantages. 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.
History of Bartering
The history of bartering dates all the way back to 6000 BC. Introduced by Mesopotamia tribes, bartering was adopted by Phoenicians. Phoenicians bartered goods to those located in various other cities across oceans. Babylonian’s also developed an improved bartering system. Goods were exchanged for food, tea, weapons, and spices. At times, human skulls were used as well. Salt was another popular item exchanged. Salt was so valuable that Roman soldiers’ salaries were paid with it. 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. When money was invented, bartering did not end, it became more organized.
Due to lack of money, bartering became popular in the 1930s 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. If any items were sold, the owner would receive credit and the buyer’s account would be debited.
Advantages of Bartering
There are many advantages of bartering, however, there is something to take note of. A complication of bartering is determining how trustworthy the person you are trading with is as there are no proof or certification that they are legitimate, no warranties etc so you need to make sure to check all the goods properly before you exchange. To barter successfully, sometimes you need to give and take..
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. Another advantage is recycling. Many goods can be recycled. For example, books, which you have read and no longer want, you can exchange it for other books, which other people also have, saving money without having to buy anything new..
Another advantage of bartering is that you do not have to part with material items. Instead, you can offer a service in exchange for an item. For instance, if your friend has a skateboard that you want and their bicycle needs work, if you are good at fixing things, you can offer to fix their bike in exchange for the skateboard. With bartering two parties can get something they want or need from each other without having to spend any money.