Y Li – Week 5 – Systems of Exchange

“Exchange” is what we would experience everyday, there are many different types of exchanges for different society, distribution part of exchange including reciprocity, redistribution, and market exchange. These exchanges change and develop as time goes by, to fit in different types of society and age.

First of course if the reciprocity, or the reciprocal exchange, I assume that is the very first type of exchange that most of the society used, it’s a direct exchange between goods and services at the same value, not currency as a medium since people didn’t realized the importance of currency. Reciprocity happens between two or more equal status entities, usually, each entities who attend in the exchange give what they don’t need but abundant of to get what they need, an good example will be the Kula Ring. The process of goods moving from one side to another is called the “ generalized exchange”

The next type of exchange would be redistribution, which goods are all collected by central authority and re-give to people following special rules. This types of exchange is always used during hard time like after wars or recessions. If you came to China in around 1960s, you would find that you can’t buy things using just money, because China was experiencing a hard time during that period because of recession, so the government was issuing special tickets, whatever you want to buy you have to have that kind of ticket, if you want to buy meat you need money and meat tickets, if you want to buy cloth to make shirt you need money and cloth tickets (people make their own clothes at that time), almost everything needs tickets, even you earn ten millions a month, you can’t buy anything because you don’t have ticket. And those tickets are given by government to each family based on the number of family members, each kinds of ticket are limited to maintain the basic level of living, and special tickets like glass ticket need to be applied with proves like “my old window just broke”or something like that. I considered it’s a form of redistribution, the government gathered nearly all the productions and re-allocated to each person limited to make sure that each individuals have enough to live, because the resources are so rare that if rich people just use money to buy whatever they want, other people will die of starving.

The last one would be the market exchange, it’s the exchange of good and services for money at price determined by supply and demand, it’s the most common type of exchange in nowadays’ world. That’s the time that currency appears, each goods start to have a comparative fixed value based on the supply and demand, which makes it more convenience for people to exchange. A person’s labor play an particularly important role in this type of exchange because now it can be directly valued with money, for example, a hand-made shoes is always expensive, because of the labor it takes to make a pair of hand-make shoes is much more than machine-made because it has higher cost at labor and time.

3 thoughts on “Y Li – Week 5 – Systems of Exchange

  1. I enjoyed reading your post. One good point you made was about Redistribution in lecture video (lecture 5.2, slide 11). Your example was about China around 1960’s and it was in hard times because of recession, so the government had to step into help by issuing special tickets because you couldn’t really buy things just using money at that time. You need money and the ticket to buy things and it was a way to keep the people alive and from starving because of the recession. You made good points that I didn’t think about for Redistribution like wars and recessions. Another point you made was about Market exchange in lecture video (lecture 5.2, slide 9). I agree that a person’s labor plays an important role in market exchange because if you work you get money for the hours you work. Another good point you made was about a hand made shoes are expensive because of higher cost of labor and time then a machine made.

  2. I enjoyed reading your blog on exchange. It was very enlightening. I especially liked the part when you discussed the economic system of China in the 1960’s. This was something that I’d never heard of before and sounds very unique. It’s also scary to me that the government has that much control of what people are able to get even if they need more. Basing it off of the family size is interesting. What if they like to eat more or less of a specific food or dress in a certain way for work or school? I think that it sounds harsh to keep things from people who work hard and can afford things that they need more of but I also understand that there are things that need to be maintained and the government can help control that. I love your piece on a person’s labor. How hand-made items are more expensive than machine made. We see less of this in the US and I believe that people don’t find the value in hand-made items anymore. Overall this is a great piece and I got a lot of interesting information with a great perspective.

  3. When you first started off about how we experience exchange everyday, I thought that was very relatable. It doesn’t have to mean from a large or small perspective. Exchange can happen anyway, and it all is determined by society and what that society needs. Each social spectrum determines what is best for them and their people based off culture. Based off that, they begin a system of exchange depending on what they need and start the process of production and distribution. I found that your post was very good because of the points you mentioned. You took your own take on the different points in exchange and I found that great. I learned about some new information that I didn’t know before. I think that this week’s lesson was very important to learn because of the main details in tacked with exchange. It’s important to realize where certain goods come from, the history behind it, and how it’s all happening it. Things have changed since technology has emerged. This has made things faster and easier for production and distribution.

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