Q1.
What are the different types of difficulties you encountered in the situation above?
Answer
Five distinct kinds of difficulty, each of which the chapter later gives a name.
- Matching two sets of wants. The person who has shoes must also want exactly what you are offering. This is the double coincidence of wants.
- Deciding a fair rate. Is a sweater worth two bags of wheat or five? There is no agreed answer, because there is no common standard measure of value.
- Splitting the goods. An ox cannot be cut into a shoe-sized portion — the problem of divisibility.
- Moving the goods. An ox and sacks of wheat must be led or carried from place to place — the problem of portability.
- Keeping the goods. Wheat rots or is eaten by rats, so wealth cannot be stored — the problem of durability.
On top of these come the plain costs of time and effort: several journeys, several rounds of bargaining, and a safe store to build.
Why it happens: each difficulty comes from the same root — in barter, the thing being exchanged has to do two jobs at once. It has to be useful in itself and serve as payment. Money separates the two jobs, and every difficulty dissolves.