Imagine life before money.
The common narrative taught in most high schools centers on the Agricultural Revolution. Ten thousand years ago, nomadic hunter-gatherers cracked the code of agricultural development, established the first settlements, and began producing surpluses. As humans began to specialize in the making of various goods, it became expedient to be able to trade products with neighbors.
While there is no objective conversion rate between bushels of hay and slabs of goat cheese, neighbors understood that trade was a means of helping one another out. This early form of debt was a social activity that branched off into various forms of gift, commodity, or credit economies. The founding idea motivating this fable is barter: before money, people directly traded valuable objects with one another.
There’s just one problem. There is no anthropological evidence to suggest that this vision of a barter economy (pre-dating the invention of money) ever existed. The earliest recorded instantiation of the barter economy can be found in Adam Smith’s Wealth of Nations; however, Smith’s vague examples hardly offer firm historical evidence.
According to Caroline Humphrey’s "Barter and Economic Disintegration," all "available ethnography suggests that there never has been such a thing” as a purely barter economy. In fact, barter often postdates the invention of money. Anthropologist David Graeber’s research suggests that “most of the cases we know about, [barter] takes place between people who are familiar with the use of money, but for one reason or another, don’t have a lot of it around” (pg. 37). Crucially, these societies do not treat economics in terms of debt and what individuals owe one another, but instead, they treat economics in terms of what one owes the community.
So what’s the big deal? Global societies ranging from the Iroquois Nation to the Kalahari Bushmen opted to organize their financial dealings around something other than money.
One upshot is that another vision of economics is possible. Humans have not always operated on a quid-pro-quo basis—debt was less of a contractual arrangement than a governing social structure. Physical currency is less of a natural and inevitable outgrowth of human nature than a choice that we all opt into. For Graeber, assigning numeric values to objects makes it all too easy to apply to people as well, enabling the logic of slavery, imperialism, and the International Monetary Fund.
Perhaps more importantly, this same kind of individual logic undergirds our contemporary decentralized gig economy of temporary, flexible workers. If you have a car, property, or a smartphone, you too can enter the economic field as a producer and become your own boss.
However, as we will explore in later articles, this idealistic vision of a sharing economy finds its roots in the mythical barter economy. While earlier forms of debt conceived the practice socially, rather than purely economically, its modern instantiation is caught up in its utilitarian logic of consumption. Rather than connecting someone to their community, this modern version of the barter economy cuts them off from the totality of their labor.
From a global perspective, debt has not always been this way and may not have to be so eternally.
Graeber, David. Debt: The First 5,000 Years. Brooklyn, New York, Melville House, 2011.
Humphrey, Caroline. “Barter and Economic Disintegration.” Man, vol. 20, no. 1, 1985, pp. 48–72. JSTOR, www.jstor.org/stable/2802221.
Last Fact Checked on May 25th, 2021.