Definition of Barter
Barter is a type of trade in which goods or services are directly exchanged for other goods and/or services, without the use of money. Barter usually replaces money as the method of exchange in times of monetary crisis, when the currency is unstable and devalued by hyperinflation.
History of Barter
In the past, goods were to be exchanged in the goods of another without considering of its money value. To organize production and to distribute goods and services among their populations, many pre-capitalist or pre-market economies relied on tradition, top-down command, or community democracy instead of market exchange organized using barter. Relations of reciprocity and/or redistribution substituted for market exchange. Trade and barter were primarily reserved for trade between communities or countries. It is also used when the monetary system failed to measure the economic value of goods.