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SIMULATING A MULTIPRODUCT BARTER EXCHANGE ECONOMY
Author(s) -
LEVY DANIEL,
BERGEN MARK
Publication year - 1993
Publication title -
economic inquiry
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.823
H-Index - 72
eISSN - 1465-7295
pISSN - 0095-2583
DOI - 10.1111/j.1465-7295.1993.tb00885.x
Subject(s) - barter , economics , unit of account , order (exchange) , store of value , value (mathematics) , microeconomics , exchange economy , medium of exchange , object (grammar) , function (biology) , economy , monetary economics , computer science , macroeconomics , currency , finance , machine learning , artificial intelligence , evolutionary biology , biology
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.