Adam Smith, Graeber and the Question of Barter
ancient humans didn't barter, they exchanged gifts
The whole edifice of capitalist economics is a sham, according to David Graeber in Debt: the First 5,000 Years, because Adam Smith makes the false assertion in Chapter II: “On the Principle Which Gives Occasion to the Division of Labour” of The Wealth of Nations that
This division of labour… is… the consequence of a certain propensity in human nature… the propensity to truck, barter, and exchange one thing for another.
Smith goes on:
Whether this propensity be one of those original principles in human nature… or whether… it be the necessary consequence of the faculties of reason and speech, it belongs not to our present subject to inquire.
This, writes Graeber, is the “myth of barter” that French anthropologist Marcel Mauss identified as “in most important ways, the founding myth of our contemporary civilization.”
When it comes to this myth, most of us have felt like we were smashing our heads against the wall as we’ve watched this same, just-so story repeated ad-nauseam by economists… no matter how many times we demonstrated that it couldn’t have been true.
That’s because, writes Graeber, anthropologists and ethnographers like Mauss in the last century have shown that this is wrong; pre-modern societies did not feature barter. They featured reciprocal gift-giving, and gift-giving between people that knew and lived adjacent to each other. Mauss developed his ideas contra barter in The Gift. You can tell that the “myth of barter” is a Thing among our lefty friends because La Wik gives Graeber a long paragraph in its article on The Wealth of Nations.
OK, fine. But Smith does not claim that barter is a founding principle of human society. He just says that, given the present division of labor, humans must have a “propensity to truck, barter, and exchange.” Otherwise, the division of labor couldn’t exist, not without humans having the said propensity to truck, barter, and exchange. He was putting out a “likely story” about the origin of the division of labor. As humans tend to do when they don’t have Science or Facts to rely on.
Barter, according to Graeber, emerges after the collapse of empire and its coinage system. Then people try to exist through barter rather than by purchasing goods with coins. Sounds plausible.
You can see the human reciprocal gift-giving culture in the community of women. Modern women love to give each other gifts. Sometimes the gift is something that the gift-giver knows the other woman needs; sometimes the gift is something that the gift-giver thinks the other woman would like; sometimes the gift is merely an expression of the gift-givers ability to give. But, the modern woman is also a ferocious bargain-hunter and coupon-clipper, and if a product does not come up to snuff she expects to be able to return it for a full refund. I’m not sure if that reflects a propensity to barter or a determination to get her money’s worth. More research is needed.
The point about markets and the division of labor and debt and credit and exchange is that it is a human adaptation to the change in human social interaction from the village to the city, from the world where you know everyone — and therefore know who you can trust — to the world where you don’t know the person who makes your bread or slaughters your meat. And, wouldn’t you know, humans figured out how to do it.
That’s the amazing thing, like every human invention. The various likely stories about how it all started are just par for the course, from Rousseau’s first man enclosing his piece of land to Adam Smith’s propensity to barter. If you take it too seriously you are missing the point.
And arguing about barter versus gift-giving is meaningless. The question is what are we going to do about soaring crime, homelessness, stagnant wages, unaffordable housing, and soaring national debt. Over to you, lefties.