Can You Explain The Term Of Barter System?

At the early stage of man's economic life, the wants were very limited in number. Man could easily satisfy all his needs with what the procedure himself. But as time passed, his needs begin to increase and he lost his self sufficiency. He began to exchange some of his products which he had in excess with those who had surplus products with themselves.

For instance, if a fisherman wanted to have skins, he could get them by giving fish to the hunter. Similarly, if a weaver wanted a pair of shoes, he could receive that by giving some cloths to the cobbler. This direct exchange of commodity for commodity without the use of money is termed as barter in economics.

Barter is workable in backwards as well as advanced countries. It exists more in economically backward and commercially under developed areas of the world. Why too far, in many countries of Pakistani villages, the payments to village artisan is still made in kind. Women and children in the villages for get sugar, cloth spices, toys, sweetmeats, etc., directly in exchange for cotton seeds, wheat, etc from the village shopkeepers.


In advanced countries of the world, we do not come across the exchange of this type in their daily business. It is because of the range of wants and the range of commodities is so wide that is actually impossible to satisfy them through a direct exchange of goods.

A barter system was a system of exchange of goods in lieu of other goods in the ancient times.We find this system of trade in Indus Valley Civilization.As the concept of money was not in to act,so the people in ancient times exchanged goods to buy other.For example to buy some wheat a person exchanged some milk with the owner of wheat fields.