System of
exchange
An exchange system or trade network can be defined
as any manner in which consumers connect with producers. Regional exchange
studies in archaeology describe the networks that people used to gain, barter
for, purchase, or otherwise obtain raw material, goods, services and ideas from
the producers or sources, and to move those goods across the landscape. The
purpose of exchange systems can be to fulfill both basic and luxury needs.
Archaeologists identify networks of exchange by using a variety of analytical
techniques on material culture, and by identifying raw material quarries and
manufacturing techniques for specific types of artifacts.Exchange systems have
been a focus of archaeological research since the mid-19th century, when
chemical analyses were first used to identify the distribution of metal
artifacts from central Europe. One pioneer study is that of archaeologist Anna
Shepard who during the 1930s and 40s used the presence of mineral inclusions in
pottery sherds to provide evidence for a widespread trade and exchange network
throughout the southwestern United States.
Economic Anthropology and Exchange Systems
The underpinnings of the exchange systems research
were strongly influenced by Karl Polyani in the 1940s and 50s. Polyani, an
economic anthropologist, described three types of trading exchange:
reciprocity, redistribution, and market exchange. Reciprocity and
redistribution, said Polyani, are methods that are embedded in long-range
relationships that imply trust and confidence: markets, on the other hand, are
self-regulating and disembedded from trust relationships between producers and
consumers.
Reciprocity is a behavioral system of trade, which
is based on the more or less equal sharing of goods and services. Reciprocity
could be defined simply as "you scratch my back, I'll scratch yours":
you do something for me, I'll reciprocate by doing something for you. I'll
watch your cows, you'll provide my family with milk.
Redistribution involves a collection point from
which goods are apportioned out. In a typical redistribution system, a village
chief collects a percentage of the produce in a village, and provides it to
members of the group based on need, gifts, feasting: any one of a number of
etiquette rules that have been established in a given society.
Market exchange involves an organized institution,
in which goods producers congregate at specified locations at specified times.
Either barter or money exchange is involved to allow consumers to obtain
required goods and services from purveyors. Polyani himself argued that markets
may or may not be integrated within community networks.
Recriprocity
The oldest mode of exchange is Reciprocity which is
used in egalitarian societies, like that of the Ju/’hoansi. There are three
different types of reciprocity: generalized, balanced, and negative
reciprocity.
Generalized reciprocity is an exchange where return
isn't expected right away and the value of this return isn’t specified. This is
based on the assumptions that all exchange balances out, like that between
family members. This is largely based on trust.
Balanced reciprocity (or also known as Symmetrical
reciprocity) is when exchange is made with the expectations that those who give
an amount will get the same in return. This, unlike generalized reciprocity,
has a specified time limit as to when the return should be made. The
Ju/’hoansi, who use reciprocity in their societies in all forms, use balanced
reciprocity. They distinguish between what they barter, which requires
immediate balanced exchange (this is similar to our shopping experiences, where
it's expected that money will be immediately exchanged for goods). With in the
Ju/'hoansi, this also includes hxaro, which establishes that this exchange
entitles obligations between the two in the future.
Negative reciprocity is when a party tries to
exchange without having to give up any value, which is the opposite of balanced
exchange. "This can range from haggling prices to outright seizure."
Reciprocity, the most ancient mode of exchange, was
the exchange of goods and services of equal value. Generalized reciprocity can
be defined as when the individuals involved just assume that the exchange will
balance out. Nothing is expected immediately and a value of return is not
established before the exchange is made. This type of reciprocity occurs often
between parents and children. Balanced reciprocity, the opposite of
generalized, is when a specific value of return and under an established time
limit is expected. This exchange can be found between those in relationships.
For example, when boyfriends and girlfriends exchange gifts of equal value and
expect the same in return at Christmas. Negative reciprocity is the exchange of
goods or services when at least one party attempts receive something for nothing
in return without suffering consequences. This type of reciprocity can involve
haggling or in some cases seizure.
"In cultural anthropology and sociology,
reciprocity is a way of defining people's informal exchange of goods and
labour; that is, people's informal economic systems. It is the basis of most
non-market economies. Since virtually all humans live in some kind of society
and have at least a few possessions, reciprocity is common to every culture.
Marshall Sahlins, a well known American cultural anthropologist, identified
three main types of reciprocity in his book Stone Age Economics (1972).
Generalized reciprocity is the same as virtually
uninhibited sharing or giving. It occurs when one person shares goods or labor
with another person without expecting anything in return. What makes this
interaction "reciprocal" is the sense of satisfaction the giver
feels, and the social closeness that the gift fosters. In industrial society
this occurs mainly between parents and children, or within married couples. In
other cultures generalized reciprocity can occur within entire clans or large
kin groups, for instance among the east Semai of Malaysia. Between people who
engage in generalized reciprocity, there is a maximum amount of trust and a
minimum amount of social distance.
Balanced or Symmetrical reciprocity occurs when
someone gives to someone else, expecting a fair and tangible return at some
undefined future date. It is a very informal system of exchange. The
expectation that the giver will be repaid is based on trust and social
consequences; that is, a "mooch" who accepts gifts and favors without
ever giving himself will find it harder and harder to obtain those favors. In
industrial societies this can be found among relatives, friends, neighbors, and
coworkers. Balanced reciprocity involves a moderate amount of trust and social
distance.
Negative reciprocity is what economists call barter.
A person gives goods or labor and expects to be repaid immediately with some
other goods or labor of the same value. Negative reciprocity can involve a
minimum amount of trust and a maximum social distance; indeed, it can take
place among strangers."
John Restakis (in ch. 6 of Humanizing the Economy):
"Reciprocity is the social mechanism that makes
associational life possible. It is the foundation of social life. In its
elements, reciprocity is a system of voluntary exchange between individuals
based on the understanding that the giving of a favour by one will in future be
reciprocated either to the giver or to someone else. A simple example is the
loan of a lawn mower by one neighbour - call him Frank, to another – say, Fred.
Frank makes the loan on the assumption that at some later date Fred will return
the favour. If Fred does not, the basis of reciprocity falls apart. No more
loaning of the lawnmower to Fred. Moreover Fred’s non-reciprocity, if it
continues, becomes reputational. Others will stop extending favours to Fred
also. So willingness to reciprocate is a basic signal of the sociability of an
individual. Taken to an extreme, the complete unwillingness of an individual to
reciprocate is tantamount to severing the bonds between themselves and other
people. Reciprocity is thus a social relation that contains within itself
potent emotional and even spiritual dimensions. These elements account for an
entirely different set of motivations within individuals than behaviour in the
classical sense of “maximizing one’s utility” as a consumer.
Reciprocity animates a vast range of economic
activities that rest on the sharing and reinforcement of attitudes and values
that are interpersonal and constitute essential bonds between the individual
and the human community. What is exchanged in reciprocal transactions are not
merely particular goods, services and favours, but more fundamentally the
expression of good will and the assurance that one is prepared to help others.
It is the foundation of trust. Consequently, the practice of reciprocity has
profound social ramifications and entails a clear moral element. Reciprocity is
a key for understanding how the institutions of society work. But it is also an
economic principle with wholly distinct characteristics that embody social as
opposed to merely commercial attributes. When reciprocity finds economic
expression in the exchange of goods and services to people and communities it
is the social economy that results. Examples range from the provision of burial
services through the creation of friendly societies in the 1800s to the
promotion of neighborhood safety through organizations like Neighborhood Watch
today.
Finally, reciprocity is egalitarian – it presupposes
a direct relationship of equality between the individuals involved. It is very
different from altruism where the giver may have no relation to the receiver
and where there is a clear asymmetry of power, as is the case with
charity."
Contemporary Reciprocity
"In experiments and surveys people are not
stingy, but their generosity is conditional. Moreover, they distinguish among
the goods and services to be distributed, favoring those which meet basic
needs, and among the recipients themselves, favoring those thought to be
"deserving." Strong reciprocity and basic needs generosity better
explain the motivations that undergird egalitarian politics than does
unconditional altruism. By "strong reciprocity" we mean a propensity
to cooperate and share with others similarly disposed, and a willingness to
punish those who violate cooperative and other social norms--even when such
sharing and punishing is personally costly. We call a person who acts this way
Homo reciprocans. Homo reciprocans cares about the well-being of others and
about the processes determining outcomes--whether they are fair, for example,
or violate a social norm. He differs in this from the self-regarding and outcome-oriented
Homo economicus. We see Homo reciprocans at work in Chicago's neighborhoods, in
a recent study that documented a widespread willingness to intervene with
co-residents to discourage truancy, public disorders, and antisocial behaviors,
as well as the dramatic impact of this "collective efficacy" on
community safety and amenities.1
Homo reciprocans is not committed to the abstract
goal of equal outcomes, but rather to a rough "balancing out" of
burdens and rewards. In earlier times--when, for example, an individual's
conventional claim on material resources was conditioned by noble birth or
divine origin--what counted as balancing out might entail highly unequal
comfort and wealth. But, as we will see, in the absence of specific
counter-claims, modern forms of reciprocity often take equal division as a
reference point."
Anna Harris: "Reciprocity – defined as the
practice of exchanging things with others usually for mutual benefit. Michel
describes reciprocity as the basis of the social bond, and designates it as a
voluntary act. Clearly there is some obligation implied if not specified, since
'complete unwillingness' to reciprocate can lead to a severance of social
bonds. This unwillingness might also be seen as a result of 'psychological
distress' as described by David Smail .
In other words 'unwillingness' need not be conceived
of as some sort of personal failure, but could also be understood as a response
to certain social conditions and structures which have not (yet) evolved to
supporting individuals in reaching their full potential. This would indicate
that societies where reciprocity is the basis of the social bond, are
themselves still in transition, have not evolved beyond / transcended the ego.
To paraphrase one of Thomas Huebl's talks, he
describes the ego, which is mainly concerned with getting something for itself,
as going through different phases of development: initially in childhood, the
child is dominated by its constant need to receive; then the mature adult who
looks for a more balanced exchange, (the market or reciprocity), lastly,
transcending the ego, by experiencing abundance through connection to higher
energies, and being inspired to pass this on by giving in service. Thomas sees
this last phase as a precondition for a sustainable society.
I believe this is what we are seeing in the
beginnings of the p2p movement, the 'shareable society' and the reclamation of
the commons. The traditional role of women as the care-givers, ie. giving
without asking for return, also fits in here. Reciprocity is best seen as a
stage (of course stages overlap) in our awakening consciousness, the spiritual
component to which Bauwens alludes, and a development out of the childhood
selfishness/ self-centered focus on private interests and gain.
The same applies to trust. In so far as trust is
dependent on an expected return, whether to the giver or someone else, whether
now or in the future, there will be an obligation on the receiver, and in that
sense it will not be a free association. I understand that Michel is
approaching from the viewpoint of designing an economy which serves the
interests of the community. However the greatest good is not that which serves
the community, but that which serves the community and the individual. The
principle of reciprocity, while serving the community, does not provide for the
freedom of the individual. On the contrary it obliges the individual to
reciprocate at some point." (networked labour mailing list, May 2014)
Redistribution
Redistribution is a mode of exchange that involves
some sort of centralized social organization. Members of a group contribute items
such as food, money, clothing, etc. to the central organization, and the
organization then redistributes the items to the members of the group.
Redistribution can occur on a small scale or a very
large scale. A small scale example of redistribution is a class party. Each
person is assigned something to bring – chips, salsa, pop, brownies, napkins,
utensils, etc. On the day of the party, everyone brings in their items to share
with each other. The Salvation Army is a good example of a rather medium-sized
scale of redistribution. The Salvation Army collects money, clothing, household
goods, cars, and even airline miles to redistribute to those in need. A large
scale example of redistribution is the Internal Revenue Service. The IRS
collects taxes from citizens and redistributes the money throughout our
governmental system, to education, post offices, road construction, and the
like.
Salvation Army in Lausanne
One widespread local example of redistribution is
church potlucks. For special events, several churches hold potlucks. Every
family who comes brings a single dish – anything from veggie trays to fried
rice to potato salad. All the dishes are placed together in a central area, and
when everyone has arrived, the congregation can eat a meal together from the
assortment of dishes.
Another example of this is under Big Man/Big Woman
political groupings in the South Pacific where the leader, chosen by favor, is
in charge of general affairs, and collects a certain sum (i.e. a pig) from
their group and redistributes it. This gives the Big Man/Big Woman the label of
generous, although they personally don’t give any more than anyone else. This
is also an example of the tradition of potlatch, where group members all give
goods to one, who evenly distributes these goods among the community. The main
point of this is to redistribute wealth.
Redistribution requires some form of centralized
social organization. Those who own the central position of the organization
receive economic contributions from all members of the group. With the
contributions they receive from all members of the group they redistribute
those goods to all the members of the groups in fair amounts to meet the needs
of every member of the group. A potlatch is a good example of redistribution.
When people go an event and are provided with food they then take that food and
redistribute it to all members of their family or some kind of group they
belong to. An example of this is the indigenous Americans of the northwest
coast of North America. This is a very common mode of exchange among tribes and
groups in all part of the world. It is a fair and normally well organized mode
of exchange and valued by the members of most tribes and groups.
Potlatching
Potlatches are ceremonies held by First Nations
peoples on the Pacific Northwest coast of the United States and Canadian
province of British Columbia such as the Haida, Tlingit, Salish and Kwakiutl
(Kwakwaka'kawakw). The potlatch takes the form of a ceremonial feast
traditionally featuring seal meat or salmon. In it, hierarchical relations
between groups were observed and reinforced through the exchange of gifts and
other ceremonies. The potlatch is an example of a gift economy, whereby the
host demonstrates their wealth and prominence through giving away their
possessions and thus prompt participants to reciprocate when they hold their
own potlatch. Although this sort exchange is widely practiced across the planet
(consider, for example, the Western practice of buying one's friends rounds of
drinks), the Northwest Coast potlatch is of a massive scale, and also served to
redistribute goods from coastal to inland ecological zones.
The native peoples of the Northwest Coast of North
America institutionalized this ceremonial redistribution of food and gifts. The
southern Kwakiutl people were the most elaborative on this custom until 1904
when the potlatch was outlawed, however the ceremony did continue to be
practiced in many societies. In 2004, the Tlingit clan members re-enacted the
ritual in Sitka, Alaska, for the 100th Anniversary Commemoration of "The
Last Potlatch". The clan members dressed in traditional Tlingit attire and
practiced Tlingit traditions for the two day long celebration. Watercolour by
James Gilchrist Swan (1818-1900) of the Klallam people of chief Chetzemoka
(nicknamed 'the Duke of York'), with one of Chetzemoka's wives (nicknamed
'Jenny Lind') distributing 'potlatch' at Port Townsend, Washington, USA.
Market
Exchange
Market Exchange is used in Capitalist societies and
is the most recently developed mode of exchange. Market exchange is the trade
of goods that are calculated in value based on a standard of value and
typically money, which are carried out by the market. Although trade and money
were developed independently, they are used together to create market exchange.
This is generally used in the Western societies, in places such as, Europe and
the United States.
Modes of exchange are the patterns involving the
three distribution techniques: reciprocity, redistribution, and market
exchange. Exchange can either be balanced or unbalanced.
Balanced Exchange: Exchange with no short or long
term marginal gain (profit).
Unbalanced exchange: Exchange where profit or
marginal gains are the end goal.
Market Exchange was invented by the capitalist
society that uses an economic system in which wealth, and the means of
producing wealth, are privately owned and controlled rather than commonly,
publicly, or state-owned and controlled. It is where currency exchange takes
place. It is where banks and other official institutions facilitate the buying
and selling of foreign currencies. Trade, money, and market institutions developed
independently and were not invented to work together. Capitalism is unique
because the three (trade, money, and market) ended up working together. This
was first done in the societies of early modern Europe. It is said that
different modes of exchange often co-exist within a single society meaning that
each society has their own way of operating and exchanging good in their
day-to-day lives.
For example, in the United States we use the market
mode or exchange, but you can still find redistribution and reciprocity.
Reciprocity if you recall is the most ancient mode of exchange, was the
exchange of goods and services of equal value and redistribution requires some
form of centralized social organization. In families in the U.S., most parents
have and income and then redistribute that income to their children and loved
ones. Parents using their income to buy their children food and clothing
without expecting return is an example of reciprocity. Some people believe that
you cannot properly understand the exchange process without first fully
understanding the production process. People who meet exchange have different
resources to use when bargaining with one another, and it is said that these
differences in resources are not shaped by the market but by the productive
process.
As consumers, it is also important to take into
account what kind of trade or exchange you are supporting with your purchase.
Take a highly consumed north-west product, a cup of coffee. Like any product
there is a story about where it came from. In this case there is the farmer,
the distributor, and the company which you are buying it from. Is the coffee
fair trade? Does it support organic farming? It is good to know what kind of
exchange in which you are participating, but also important to know if your
dollar is being spread out in a way that you think is appropriate.
Bibliography
Stphen,H. (1992). Barter, Exchange and Value: An
Anthropological Approach. New York,USA. University of Cambridge.
Alexander Moore. Cultural Anthropology: The Field
Study of Human Beings. San Diego, California. Collegiate Press.
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