Simulating a Multi-Product Barter Exchange Economy

Posted: 25 Feb 2005

See all articles by Daniel Levy

Daniel Levy

Bar-Ilan University - Department of Economics; Emory University - Department of Economics; Rimini Center for Economic Analysis

Mark E. Bergen

University of Minnesota - Carlson School of Management

Abstract

We describe a multiproduct barter trading experiment in which students exchange real goods in an open market based on their own preferences. 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 feature 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.

Keywords: Barter, exchange economy, market simulation, role of money, functions of money, medium of exchange, unit of account, store of value

JEL Classification: C91, C93, E40, E50

Suggested Citation

Levy, Daniel and Bergen, Mark E., Simulating a Multi-Product Barter Exchange Economy. Economic Inquiry, Vol. 31, No. 2, pp. 314-321, April 1993. Available at SSRN: https://ssrn.com/abstract=671921

Daniel Levy (Contact Author)

Bar-Ilan University - Department of Economics ( email )

Ramat-Gan, 5290002
Israel
+972 3 531-8345 (Phone)
+972 3 738-4034 (Fax)

HOME PAGE: http://econ.biu.ac.il/en/levy

Emory University - Department of Economics ( email )

1602 Fishburne Drive, Suite 306
Rich Building
Atlanta, GA 30322-0001
United States

HOME PAGE: http://economics.emory.edu/home/people/faculty/Levydaniel.html

Rimini Center for Economic Analysis ( email )

Wilfrid Laurier University
75 University Ave W.
Waterloo, Ontario N2L3C5
Canada

HOME PAGE: http://rcea.org/

Mark E. Bergen

University of Minnesota - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States
612-624-1821 (Phone)

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