1.2 Let us define a market (or economic) exchange as the exchange of a good or service for a quantity of money, or for another a good or service.
Figure 3 - Economic exchange
1. To support this proposition, let us examine type X and type Y exchanges by considering an example of each.
Andrew does the dishes for Paul's restaurant in exchange — a type X exchange — for food or money. Dishwashing is a service rendered; its counterpart is a transfer of property in the form of food or money. James gives.
James gives John bread in exchange for wine or a sum of money. In this exchange — a type Y exchange — there are reciprocal transfers of two goods.
2. A type X or type Y exchange is a barter when the counterpart is not money,.
It is partly a barter when the counterpart is not solely money. In an economy where the practice of barter has become very marginal, a slightly shorter statement of proposition 1.2 becomes almost sufficient: let us call any economic exchange when one of its terms is a service or property other than money, and the other term is money.
3. Type X and type Y exchanges belong to the same subset of contracts entailing reciprocal obligations for both parties.
Andrew does the dishes for Paul's restaurant in exchange for money that he later uses to buy an item from James, who in turn uses that money to engage in a type X or type Y exchange, and so on.
All economic exchanges are social; not all social exchanges are economic. Apart from exchanging one sum of money for another, every counterpart given in exchange for money is a commodity.
5. But what exactly is a commodity?
And what are the different categories of commodities? A theory of commodity exchanges, i.e. of the exchange of commodities, is too little developed as long as it is not based on a theory of the commodity, or the theory of services and goods that have an economic exchange value.
6. Drawing up an inventory of the kinds of counterparts in exchange for a quantity of money divides all commodities into subsets.
This division is superfluous if the main determinant of any price, or exchange value, is always the same. Otherwise, the main determinant is likely to vary from one kind of commodity to another.
7. To be sure, a method is necessary: postulate the opposite case, even if it means having to conclude that the main determinant is always the same.
So don't dwell on the question: where does the (exchange) value of everything that is sold and bought come from? To prefer it: where does the value (always exchange) of each great kind of thing that is bought and sold comes from? By avoiding any petītiō principiī, including the one, as has already been noted, of the law of supply and demand as a controller of price formation in all circumstances.
8. Economic exchange is an act whose morality is as positive as that of a gift.
Conversely, the economic gift is an act whose morality is potentially as positive as that of economic exchange. The repression of this recognition affects the way enterprises are generally managed.