subject: Barter Exchange: Yesterday and Today [print this page] Human beings have been there since longHuman beings have been there since long. There have been several changes and developments in our lives if we compare it with the ancient age. But there are certain demands that are still the same and have not changed. In the early ages human beings never urged for something so big and huge. They were only concerned with the basic necessities of life. From these basic necessities evolved the barter exchange system. All of us know what barter exchange system is. Even if we do not have a detailed idea of this, we all have read about this system in history. Barter system is the process in which there is no medium of exchange. In this system goods or other necessary things are exchanged with other people. In return of the goods the other person gives some other item that would be of the same value of the exchanged good. This can be easily understood if an example is given. Suppose somebody has surplus sugar and he or she is in need of cotton. Then what that person can do is find someone who has surplus cotton and can exchange that for sugar. Thus both of them get benefited.
Since there is no medium of exchange in the barter exchange system, therefore there is no question of the use of money. In ancient ages there was no question of money and for this reason barter system was so very prevalent then. It would be completely incorrect to say that the barter system was prevalent only in the ancient ages and that it has become completely obsolete now. Such is not the case at all. It is true that since the emergence of monetary system, barter system has started to disappear. But there are several developed countries where this system still exists and is prevalent along with the monetary exchange system. However it is also a fact that the existence of this system is very limited. There are times when the importance of the barter system is highly felt. This system can be very useful for anybody when that person is going through financial crisis. This system is also a good option when the currency of any country meets an unstable situation.
Barter also works as a broker and also as bank. This system has proved to be very beneficial for those in business. When it comes to big business barter is a very sensible tool for companies to get rid of their surplus production and hence through this they can elevate their efficiencies. Records say that the worldwide organized barter exchange has climbed up to 8 billion USD a year. The pros of this system have been realized by present day and people. This system has started to be utilized by several people and businessmen and companies. Barter is a very helpful tool for those who do not have enough hard cash but are in need of goods. There are several countries where barter is highly active and Spain is one of them.
