Principles of Macroeconomics / Unit 11 MAC 1002 short lesson, about 20 seconds
Barter and the Double Coincidence of Wants
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The idea
Without money, every trade needs a double coincidence of wants: each side must want what the other has. Finding that match costs time, and the time comes out of production.
In practice
A grocer in a barter economy would have to agree in advance to accept whatever you brought.
Where people slip
Barter is not merely inconvenient. The searching is a real cost to the whole economy.
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