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Simulating a Multiproduct Barter Exchange Economy

Author

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  • Levy, Daniel
  • Bergen, Mark

Abstract

We describe a multiproduct barter trading experiment in which students exchange real goods in an open market based on their own personal preference. The experiment is designed for simulating a pure exchange market in order to demonstrate the role of money and its functions in real economies by showing the limitations and inefficiencies of the traditional barter economy. In addition, the simulation is very effective in highlighting some of the key features that an object that serves as money needs to possess in order to function as an efficient medium of exchange, unit of account, and store of value.

Suggested Citation

  • Levy, Daniel & Bergen, Mark, 1993. "Simulating a Multiproduct Barter Exchange Economy," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 31(2), pages 314-321.
    • Handle: RePEc:zbw:espost:206714
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    References listed on IDEAS

    as
    1. Brunner, Karl & Meltzer, Allan H, 1971. "The Uses of Money: Money in the Theory of an Exchange Economy," American Economic Review, American Economic Association, vol. 61(5), pages 784-805, December.
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    Cited by:

    1. Levy, Daniel, 2007. "Price adjustment under the Table: Evidence on Efficiency-Enhancing Corruption," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 23(2), pages 423-447.

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    More about this item

    Keywords

    Money; Demand for Money; Barter Exchange; Monetary Experiment; Functions of Money; Medium of Exchange; Store of Value; Unit of Account; Features of Money; Information Cost; Identification Cost;
    All these keywords.

    JEL classification:

    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General

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