The Internal Revenue Service (IRS) considers bartering a form of revenue and something that must be reported as taxable income. Under U.S. generally accepted accounting principles, or GAAP, businesses are expected to estimate the fair market value of their bartered goods or services. This is done by referring to past cash transactions of similar goods or services and using that historical revenue as a reportable value. When it is not possible to accurately calculate the value, most bartered goods are reported based on their carrying value.
mid-15c., apparently from Old French barater "to barter, cheat, deceive, haggle" (also, "to have sexual intercourse"), 12c., of uncertain origin, perhaps from a Celtic language (cf. Irish brath "treachery"). Connection between "trading" and "cheating" exists in several languages. Related: Bartered; bartering. The noun is first recorded 1590s, from the verb.
Since the 1830s, direct barter in western market economies has been aided by exchanges which frequently utilize alternative currencies based on the labor theory of value, and designed to prevent profit taking by intermediators. Examples include the Owenite socialists, the Cincinnati Time store, and more recently Ithaca HOURS (Time banking) and the LETS system.
Toronto’s online Freecycle network, where 27,000-plus members can give, and get, things for free, provides a variation on bartering. Last April, Toronto hosted one of its first gift circles, which, as the name suggests, encourage small groups to form gifting communities—groups of 20 that give and take from a pool of goods and services depending on their needs. Torontonians can also swap skills at justfortheloveofit.org, a freeconomy community that spans 174 countries. On the site, members share talents that range from useful (dog walking, yoga instruction, electrical work) to questionable (boycotting, ear candling, loving) to weird (tree whispering, culture jamming, puppet making). When it comes to alternative economies, the creative possibilities are vast, but they all speak to the same desire for something different—anything other than what we have.
He would have heard of channels and sandbanks, of natural features of the land useful for sea-marks, of villages and tribes and modes of barter and precautions to take: with the instructive tales about native chiefs dyed more or less blue, whose character for greediness, ferocity, or amiability must have been expounded to him with that capacity for vivid language which seems joined naturally to the shadiness of moral character and recklessness of disposition.
As Orlove noted, barter may occur in commercial economies, usually during periods of monetary crisis. During such a crisis, currency may be in short supply, or highly devalued through hyperinflation. In such cases, money ceases to be the universal medium of exchange or standard of value. Money may be in such short supply that it becomes an item of barter itself rather than the means of exchange. Barter may also occur when people cannot afford to keep money (as when hyperinflation quickly devalues it).[15]
mid-15c., apparently from Old French barater "to barter, cheat, deceive, haggle" (also, "to have sexual intercourse"), 12c., of uncertain origin, perhaps from a Celtic language (cf. Irish brath "treachery"). Connection between "trading" and "cheating" exists in several languages. Related: Bartered; bartering. The noun is first recorded 1590s, from the verb. 

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Anthropologists have argued, in contrast, "that when something resembling barter does occur in stateless societies it is almost always between strangers."[6] Barter occurred between strangers, not fellow villagers, and hence cannot be used to naturalistically explain the origin of money without the state. Since most people engaged in trade knew each other, exchange was fostered through the extension of credit.[7][8] Marcel Mauss, author of 'The Gift', argued that the first economic contracts were to not act in one's economic self-interest, and that before money, exchange was fostered through the processes of reciprocity and redistribution, not barter.[9] Everyday exchange relations in such societies are characterized by generalized reciprocity, or a non-calculative familial "communism" where each takes according to their needs, and gives as they have.[10]
Barter-based economies are one of the earliest, predating monetary systems and even recorded history. People can successfully use barter in many almost any field. Informally, people often participate in barter and other reciprocal systems without really ever thinking about it as such -- for example, providing web design or tech support for a farmer or baker and receiving vegetables or baked goods in return. Strictly Internet-based exchanges are common as well, for example exchanging content creation for research.
In Spain (particularly the Catalonia region) there is a growing number of exchange markets.[24] These barter markets or swap meets work without money. Participants bring things they do not need and exchange them for the unwanted goods of another participant. Swapping among three parties often helps satisfy tastes when trying to get around the rule that money is not allowed.[25]

Barter-based economies are one of the earliest, predating monetary systems and even recorded history. People can successfully use barter in many almost any field. Informally, people often participate in barter and other reciprocal systems without really ever thinking about it as such -- for example, providing web design or tech support for a farmer or baker and receiving vegetables or baked goods in return. Strictly Internet-based exchanges are common as well, for example exchanging content creation for research.


Even before visiting the Marquesas, I had heard from men who had touched at the group on former voyages some revolting stories in connection with these savages; and fresh in my remembrance was the adventure of the master of the Katherine, who only a few months previous, imprudently venturing into this bay in an armed boat for the purpose of barter, was seized by the natives, carried back a little distance into their valley, and was only saved from a cruel death by the intervention of a young girl, who facilitated his escape by night along the beach to Nukuheva.
Some entrepreneurs are already taking the principles of swapping—use everything and anything you already have to survive—to create another offshoot system, one that turns a hefty profit. Called the sharing economy, it is perhaps best exemplified by Airbnb, a service that enables people to rent out their apartments like hotels. Other sites let you turn your driveway into a parking space, your car into a taxi and your tools into a rental service. Forbes estimates revenue flowing through the U.S. sharing economy will hit $3.5 billion by the end of 2013, and maybe more. It’s worth mentioning that some business associations and government members are terrified of this rise: like most alternative economies, it’s largely tax-free.

During economic downturns, when there is a keenly felt shortage of jobs and cash, people have historically adopted barter systems. The world’s most established bartering-style system is Switzerland’s wir: the German word for “we” as well as the abbreviation of Wirtschaftsring, which translates loosely to “economic circle.” In 1934, the economy in Switzerland had tanked—as it had in much of the world. Two businessmen who were facing bankruptcy, Paul Enz and Werner Zimmermann, gathered 15 of their associates in Zurich and hashed out a solution: a mutual credit system.


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Other anthropologists have questioned whether barter is typically between "total" strangers, a form of barter known as "silent trade". Silent trade, also called silent barter, dumb barter ("dumb" here used in its old meaning of "mute"), or depot trade, is a method by which traders who cannot speak each other's language can trade without talking. However, Benjamin Orlove has shown that while barter occurs through "silent trade" (between strangers), it also occurs in commercial markets as well. "Because barter is a difficult way of conducting trade, it will occur only where there are strong institutional constraints on the use of money or where the barter symbolically denotes a special social relationship and is used in well-defined conditions. To sum up, multipurpose money in markets is like lubrication for machines - necessary for the most efficient function, but not necessary for the existence of the market itself."[12]
Since the 1830s, barter in some western market economies has been aided by exchanges which use alternative currencies based on the labour theory of value, and which are intended to prevent profit-taking by intermediaries. Examples include the Owenite socialists, the Cincinnati Time store, and more recently[when?] Ithaca HOURS (time banking) and the LETS system.
Economists since the times of Adam Smith (1723-1790), looking at non-specific pre-modern societies as examples, have used the inefficiency of barter to explain the emergence of money, of "the" economy, and hence of the discipline of economics itself.[3] However, ethnographic studies have shown that no present or past society has used barter without any other medium of exchange or measurement, nor have anthropologists found evidence that money emerged from barter, instead finding that gift-giving (credit extended on a personal basis with an inter-personal balance maintained over the long term) was the most usual means of exchange of goods and services.[4]
The eXmerce barter system is set up different than traditional barter. Instead of trading products or services directly with another business, you earn Trade Dollars when a member buys from you. You can then use those Trade Dollars to purchase hundreds of products or services. Whether it’s personal or for your business, there is so much to choose from within the eXmerce community.
In Spain (particularly the Catalonia region) there is a growing number of exchange markets.[20] These barter markets or swap meets work without money. Participants bring things they do not need and exchange them for the unwanted goods of another participant. Swapping among three parties often helps satisfy tastes when trying to get around the rule that money is not allowed.[21]
Debts in the wir currency, assigned the same value as the Swiss franc, could be paid with sales to any member of the bartering circle: if a baker needed to “purchase” eggs and flour from a farmer, the baker could pay off the debt by “selling” baked goods to another wir member. The farmer, in turn, could use his newly acquired credit to “buy” his own needed items or services. Despite a bank-led campaign to discredit the system, wir stuck. Today, it has more than 60,000 business participants and does the equivalent of about $4.4 billion in annual trade.
Whether or not one agrees with such broad claims, it’s worth noting that monetary debt, a byproduct of currency, has regularly been used to by some groups to manipulate others. Thomas Jefferson, for instance, suggested that the government encourage Native Americans to purchase goods on credit so they’d fall into debt and be forced to sell their lands. Today, black neighborhoods are disproportionately plagued by debt-collection lawsuits. Even after taking income into account, debt collection suits are twice as common in black neighborhoods as in white ones. $34 million was seized from residents of St. Louis’ mostly black neighborhoods in suits filed between 2008 and 2012, much of which was seized from debtors’ paychecks. In Jennings, a St. Louis suburb, there was one suit for every four residents during those years.
The Owenite socialists in Britain and the United States in the 1830s were the first to attempt to organize barter exchanges. Owenism developed a "theory of equitable exchange" as a critique of the exploitative wage relationship between capitalist and labourer, by which all profit accrued to the capitalist. To counteract the uneven playing field between employers and employed, they proposed "schemes of labour notes based on labour time, thus institutionalizing Owen's demand that human labour, not money, be made the standard of value."[19] This alternate currency eliminated price variability between markets, as well as the role of merchants who bought low and sold high. The system arose in a period where paper currency was an innovation. Paper currency was an IOU circulated by a bank (a promise to pay, not a payment in itself). Both merchants and an unstable paper currency created difficulties for direct producers.
Debts in the wir currency, assigned the same value as the Swiss franc, could be paid with sales to any member of the bartering circle: if a baker needed to “purchase” eggs and flour from a farmer, the baker could pay off the debt by “selling” baked goods to another wir member. The farmer, in turn, could use his newly acquired credit to “buy” his own needed items or services. Despite a bank-led campaign to discredit the system, wir stuck. Today, it has more than 60,000 business participants and does the equivalent of about $4.4 billion in annual trade.
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