What Is Commodity Barter?

In the earliest stages of man as a commercial animal the exchange of products were conducted by a method known as barter. The barter when considered in its pure form involves the direct exchange of goods for goods. The terms of exchange of goods are not fixed by reference to common denominator value. Hunter for instance exchanged his fish and meat of corn or hides were exchanged for straw fruit was exchanged for arrows. This barter form of exchange was given up because of the difficulties and inconveniences faced by the people. The problems of arriving at a double coincide of want the establishing of a common measure of value, the safe keeping of wealth were all embarrassing for a man. Barter as a method of trade in its pure form has almost ceased to exist. The children for fun sake or the aged people living in isolated areas or a mentally deranged people may have a direct exchange of goods for goods without the use of money.

For centuries now the exchange of goods is conducted in an indirect method of barter involving a common denominator of value. The medium in terms of which the value of all commodities is expressed has passed through various stages of evolution. From barter unit of value which simply served as a form of wealth, the bank notes and the bank checking account are the favorite forms of money these days.

Barter means direct exchange of goods for goods. Barter system was prevalent at an early stage of man economic life when the wants were very limited in number. Man could easily satisfy all his wants which he produced himself. But as time passes his needs, began to increase. He lost his self sufficiency. He began to produce some goods in greater quantity then he could consume himself.

The purpose was to exchange some of his products which he had in excess with those who had surplus with themselves. For instant, if a fish man wanted to have sinks, he could get them by giving fish to the hunter. Similarly, if a weaver wastes a par of shoes, he could receive that by giving some surplus cloth to the cobbler. This direct exchange of surplus commodity for commodity with another person without the use of money is termed as barter in economics.
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Barter exists more in economically backward and commercially underdeveloped areas of the world. Why we go far off, in many of Pakistani village\, the payment to village artisan is still made in kind. Women and children in villages get sugar, cloth spices, toy etc. directly in exchange for ghee, 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 the range of wants and the range of commodities are so wide that it is actually impossible to satisfy them through a direct exchanged for goods but for money.

Reasons why people abandon the barter system?