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Graeber did not claim to be the first debunking the myth of barter.

However, what does it even matter, when the zombie keeps walking to this day? The linked article repeats the myth of barter.

And lest people think it's only right-ish economists that keep repeating it, Yanis Varoufakis did so too (in his book "Talking to my daughter about the economy").

And yeah sure, nothing "hinges" on the myth of barter. But it is a symptom, a glaring illustration that economists are really bad at arguing from how real people actually act, and cheerfully embrace just-so stories that support their preferred ideas - which is the linked article's whole game, too.

> Graeber did not claim to be the first debunking the myth of barter.

I didn't say Graber claimed that. I was refuting the common defence of the book and emphasising that it was already a mainstream view.

> However, what does it even matter, when the zombie keeps walking to this day?

> But it is a symptom, a glaring illustration that economists are really bad at arguing from how real people actually act

How much does the historical origin of money matter to the understanding economics of today?

Economists aren't particularly interested in the origin of money. Any references to barter are usually in fluffy lines like this article or as dumb thought experimens. The fact that some of them get it wrong is not indicative of anything.

> cheerfully embrace just-so stories that support their preferred ideas

Which is rife across the humanities and not exclusive to economics. Hell, Graber's entire book is full of just that.

If you look at popular books or even school text books, they will cheerfully claim that seasons are caused by the change in distance between the earth and the sun. That doesn't mean people working on climate models don't know that's not the case.

And Varoufakis is <insert polite term for crackpot>, not exactly representative of mainstream economics.

I think your criticism of Graeber is somewhat fair. And it's a fair point that incorrect popular/lay theories don't mean experts don't know how things actually work.

That said, I do think Graeber is right to emphasize the role of culture and belief--anthropological ideas--as an antidote to overly quantitative/mechanistic models. I'm not an economist, but it does seem like behavioral economics was pretty revolutionary in advancing the idea that humans are not just rational utility maximizers, despite Keynes using the term "animal spirits" nearly 100 years ago.

Again, speaking as a layperson, it's frankly a bit weird to me how distant economics, anthropology, and psychology seem to be from each other.

> I do think Graeber is right to emphasize the role of culture and belief--anthropological ideas--as an antidote to overly quantitative/mechanistic models

This is a false and misguided dichotomy. Nothing prevents you from taking culture and beliefs into account when you create a model.

Can you give examples of this done well? Genuinely curious, as I’ve not seen it.

Many New Keynesian models posit price and wage stickiness.

Labor search models usually have a notion of bargaining power.

I do ^^

"Just-so stories that support their preferred ideas" + "so nothing prevents you from taking culture and beliefs into account when you create a model."

A litte OT but,... years ago i read a HN-Topic, about um 'What to change if we could'. I read some postings, where people seem realy angry with abuse, misuse and malpractice, done by people who may or even may not wanted to be remembered as: 'This is our work, we do this cos we are in empowered to do so' (won't explain it more, back to more context:)

My conclusion by that time was, questioning: 'Is privatizing favourable?' Cos there is confusing data, complex situations and a need for easy hypotheses...(and solutions maybe) The assumption that time was, that the gov spend a (huge) budged to pacify many more conflicting 'partys' than a private entity would like to do/or will, cos generating income through excessive spending (may 'only work when'/'need expotential growth') means nothing more than the need to reinvest profits to bigup the businesses.

(sry, non native english-speaker)

And now really OT, I remember some of the friends around Putin are building contractors, and the TV-shows about the war in Ukraine or Syria before um...

[turns-around-in-a-circle] (-;

Behavioral economics, the bastard child of psychology, is built on an edifice of fashionable nonsense. The field is rife with grand generalizations based on dubious conclusions from small under-powered behavioral experiments. Just look at what a disaster the much hyped priming studies turned out to be. I would not count on behavioral economics to advance a more accurate understanding of the human condition.

I know very little about economics but I am compelled to point out the irony in your comment.

How I understood your comment: "This whole field, consisting up of many people trying to do understand things, is just a bunch of nonsense generalizations."

Touché.

> Behavioral economics, the bastard child of psychology, is built on an edifice of fashionable nonsense.

This is a relatively fair take. That being said, at least it's damaged and dethroned the equally misguided frictionless spheres of homo economicus.

Yes, this was my point: that prior, economists had silly ideas about humans which make no sense.

Frictionless spheres are fine in Physics 101 and Homo economicus is fine in Economics 101. Like all models, economic models too are wrong but some of them are useful. The bulk of economics after 101 is about how the models break.

The idea that humans are not perfectly rational self-interested actors has been part of mainstream economics at least since Keynes.

Sure; Keynes coined the term "animal spirits." Yet the criticism (that economics is too modelling-based) is widely levied, e.g. see https://www.theguardian.com/commentisfree/2016/sep/19/its-ti..., https://aeon.co/essays/economics-is-once-again-becoming-a-wo....

Is it the whole story? Probably not. Like I said, I'm not an economist.

But given the extreme challenges in empirically testing macroeconomic models, it should be no surprise that economists might--as somewhat irrational humans--over-rely on theoretical models.

> How much does the historical origin of money matter to the understanding economics of today?

A lot? Money is a social construct, so the history of money is something like a record of empirical observations that must be accounted for by any proposed theory of money. The fact that most modern economists don't seem too concerned with this doesn't mean that it's not important.

Right, and programmers should first learn Panini's grammer before they start writing code in constructed languages.

It is spelled grammar.

My favorite course I took in college was historical linguistics. But I was a linguistics major…

I do expect CS students to take a history of computing course.

> It is spelled grammar.

Maybe it's interesting to linguistics majors but the rest of us tend to ignore typos when the meaning is clear from the context.

> My favorite course I took in college was historical linguistics.

And?

> I do expect CS students to take a history of computing course.

The overwhelming majority of them don't and seem to do just fine.

Then history is doomed to repeat itself…

If you're going to dismiss all economists & anthropologists that do not subscribe to your opinions, you're not going to advance your opinions very much

> If you're going to dismiss all economists & anthropologists that do not subscribe to your opinions, you're not going to advance your opinions very much

The idea that Varufakis is not mainstream is not even remotely controversial. I have issues with Graeber's misrepresentation of economics, not his anthropology.

I'm pretty sure the "myth" of barter is really just an educational/explanatory crutch that economists have used to introduce laypersons to the idea of money without overwhelming them with caveats and nuances. Kind of like how schoolchildren learn that the American Revolution was a revolt against unjust "taxation without representation".

You can tell that Graeber isn't an economist because he mistakes the oversimplified educational narrative for what monetary economists actually believe about the history of money and credit. But you have a fair point--even economists often fool themselves about this, possibly because the field has grown to the point where many aren't as familiar with this topic as they should be (I don't think that was the case 100 years ago).

This is taught in universities in Economics degrees (along with many other misconceptions, as a matter of fact). So it's not at all the case you're saying.

Do you have examples of that from actual current university course materials?

There’s a big difference between “economics degree holder” and “economist”

Even if it is an oversimplified story to explain a more difficult concept, it's often used as a moral justification. And really, I'd say Debt is more about the moral justifications of capitalism than it is an economic argument one way or the other.

> it's often used as a moral justification.

A moral justification for what?

>Adam Smith's famous "It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own self-interest" thesis is wrong because shopkeepers of the time mostly sold goods on credit and thus the customers were in fact depending on their benevolence.

It's not necessarily wrong though. Giving credit can still be a self-interest motivated action, in fact it would most often only be that - generating a higher reward to the risk taken by giving it - as banks try to manage. So yes, banks aren't run by benevolence, and they aren't the most benevolent entities on the planet (far from it) - they're just economically rational actors, that are benefited by offering credit.

Err? I'm not saying Adam Smith is wrong. I'm saying Graber's characterisation of Smith's argument is wrong.

Or did I misunderstand your comment?

Apologies! I misread your comment - which I'm not sure how, upon re-reading and finding it pretty clear.

>Do you think Graber came up with this?

I believe Graeber acknowledge that Marcel Mauss came up with https://en.wikipedia.org/wiki/The_Gift_(essay) long before him ("1925 essay by the French sociologist Marcel Mauss that is the foundation of social theories of reciprocity and gift exchange")

I’m about halfway through Debt and enjoying it so far, but that Adam Smith line, The Wizard of Oz being weirdly recognized as a Sliver/Gold standard allegory and the history of the creation of IBM were all odd enough to make wonder about the rest of the book.

Which editon are you reading? I thought the garbled IBM/Apple story was removed from later editions. Anyways, it was just a failed attempt adding some colour. I wouldn't ascribe too much importance to it.

I had forgotten about the Wizard of Oz bit! I don't recall if it was meant as an aside or it was meant to support a larger point about public opinion of bimetallism.

The bulk of the middle section of the book is mostly just meh. The final chapter though is something to behold! It's comically bad.

The book remains fairly popular in certain circles. If not for anything else, read it so you can politely refute the person who brings it up at a party.

I think I have the 2014 version. I don't think the IBM story itself is too important, but it does make me a bit more skeptical about other things that I have little firsthand knowledge of. As a comparison I remember reading a local newspaper article about something I happened to be involved in and the details were a bit off, making me wonder about the other articles I had no prior knowledge of.

The Wizard of Oz bit is mostly color, but he relates it to the difficulty state-money theorists have had in coming up with similar narratives, and also that the myth of barter has persisted for lack of a similar anthropological myth for money.

The Wizard of Oz was actually in fact a silver/gold allegory.

https://economics.rutgers.edu/joomlatools-files/docman-files...

L. Frank Baum's The Wonderful Wizard of Oz, however, is not only a child's tale but also a sophisticated commentary on the political and economic debates of the Populist Era.1 Previous interpretations have focused on the political and social aspects of the allegory. The most important of these is Littlefield ([1966] 1968), although his interpretation was adumbrated by Nye (1951), Gardner and Nye (1957), Sackett (I960), and Bewley ([1964] 1970). My purpose is to unlock the references in the Wizard of Oz to the monetary debates of the 1890s. When the story is viewed in this light, the real reason the Cowardly Lion fell asleep in the field of poppies, the identity of the Wizard of Oz, the significance of the strange number of hallways and rooms in the Emerald Palace, and the reason the Wicked Witch of the West was so happy to get one of Dorothy's shoes become clear. Thus interpreted, the Wizard of Oz becomes a powerful pedagogic device. Few students of money and banking or economic history will forget the battle between the advocates of free silver and the defenders of the gold standard when it is explained through the Wizard of Oz.

That's one interpretation and not a particularly convincing one at that.

The Wikipedia article is actually pretty good overview: https://en.wikipedia.org/wiki/Political_interpretations_of_T...

No but we must recognise Graeber for bringing this idea into the mainstream

> No but we must recognise Graeber for bringing this idea into the mainstream

By misrepresenting what economists actually believe? How exactly did that improve the public discourse?

You are of course welcome to your opinions about these things, but please be respectful enough to spell the late David Graeber's name correctly.

I did not misspell Graeber's name as some deliberate slight.

>Or that this wasn't the mainstream view amongst economists?

The myth is certainly taught by mainstream economists, here is one example:

http://www2.york.psu.edu/~dxl31/econ14/lecture18.html

>And Graber doesn't stop there. He pretends like somehow all of economics is hinged upon this Myth of Barter.

I think he was specifically targeting neoclassical economists. The idea of Homo Economicus is essentially rooted in a number of myths that depict humans as spherical cows, Adam Smith's story of money emerging from barter being just one.

>Adam Smith is not the supreme arbiter and law-giver of economics.

Nope, he just has an unusual take because his analysis is more rooted in historical and anthropological study and, of course, he's kind of left wing. This angers people who try to gatekeep economic thought, limiting it to the likes of neoliberal (but still somehow mainstream) ideologues like Mankiw or Milton Friedman.

I guarantee that when David Koch made an large donation to Florida State U economics department he didn't do it with the idea that they would teach more Graeber.

> The myth is certainly taught by mainstream economists,

Can you please state what you think the supposed myth actually is? I'm asking because people seem to have very different ideas about what it actually is as seen in this very thread.

> I think he was specifically targeting neoclassical economists.

Quoting Graber:

> The answer seems to be that the Myth of Barter cannot go away, because it is central to the entire discourse of economics. Recall here what Smith was trying to do when he wrote The Wealth of Nations. Above all, the book was an attempt to establish the newfound discipline of economics as a science.

> Nope, he just has an unusual take because his analysis is more rooted in historical and anthropological study and, of course, he's kind of left wing.

I'm sorry, Adam Smith is left wing?

The myth is that barter arose spontaneously throughout history and that currency arose as a more efficient means of mediating barter.

>I'm sorry, Adam Smith is left wing?

I was referring to Graeber. He was left wing and anticapitalist.

Orthodox (neoclassical) economists like Mankiw tend to be very strongly pro-corporate due to way funding flows in the profession.

> The myth is that barter arose spontaneously throughout history and that currency arose as a more efficient means of mediating barter.

Interesting. Did you actually read Debt? Because Graeber himself says that economists don't claim a barter system as a historical fact:

> It's important to emphasize that this is not presented as something that actually happened, but as a purely imaginary exercise.

As I suspected, it seems you're arguing something else entirely

He's talking about a specific example lifted from a particular textbook with that quote where they used insinuation to push the myth. He cites another example by Stiglitz just beneath it.

I lifted a different example from some other lecture notes in my link above where they just flat out said "this is what used to happen".

Really, there is no shortage of examples. It's the same myth in all cases, (although I wouldnt be surprised if some econ textbooks got patched since the book came out).

Im not sure exactly what youre trying to prove here. The distinction you're trying to highlight is hardly material.

Yes, I obviously did read the book. I also used to believe the myth because I first read it in an undergraduate econ textbook.

The distinction between what is presented as a thought experiment and what is supposedly claimed as historical fact is most definitely material. And Graeber makes it clear what he's talking about:

> It's important to emphasize that this is not presented as something that actually happened, but as a purely imaginary exercise. "To see that society benefits from a medium of exchange" write Begg, Fischer and Dornbuch (Economics, 2oos), "imagine a barter economy. " "Imagine the difficulty you would have today," write Maunder, Myers, Wall, and Miller (Economics Explairzed, 1991) , "if you had to exchange your labor directly for the fruits of someone else's labor." "Imagine," write Parkin and King (Economics, 1995) , "you have roosters, but you want roses".

He quotes Stiglitz after this and remarks:

> Again this is just a make-believe land

Before claiming it's the same myth it's necessary to clarify what the myth actually is and why it supposedly is so important for capitalism.

> Yes, I obviously did read the book. I also used to believe the myth because I first read it in an undergraduate econ textbook.

In a deleted comment you claimed you read it in Mankiw. There it is most definitely presented as a thought experiment asking the reader to imagine the inconvenience of barter.

>The distinction between what is presented as a thought experiment and what is supposedly claimed as historical fact is most definitely material.

A) it's been presented as both. The example you pointedly ignored that I posted above is one such example.

B) It's not really that material. The story serves the same purpose either way - both in the above example and in, say, Stiglitz.

>it's necessary to clarify what the myth actually is and why it supposedly is so important for capitalism.

It is which is why Graeber did explain why it's important.

I thought you read the book?

>In a deleted comment you claimed you read it in Mankiw.

After writing that comment I double checked the 8th edition of the text to see if i remembered correctly and ctrl-f and found zero about barter in the whole book so I guess we both misremembered.

I cant honestly remember which econ textbook I read it in since it was 16 years ago, but I do know that I read it and believed it and there are plenty of other examples that can be found via google, so whatever.

> The example you pointedly ignored that I posted above is one such example.

Nobody thinks this is the mainstream consensus view, not even Graeber.

> The story serves the same purpose either way

> It is which is why Graeber did explain why it's important.

The whole thread is about why Graber's just-so explanations are wrong. And your arguments are materially different from what is actually in the text.

> I guess we both misremembered.

From The Principles of Macroeconomics, 3rd Edition. Chapter 15 - The Monetary System

> The social custom of using money for transactions is extraordinarily useful in a large, complex society. Imagine, for a moment, that there was no item in the economy widely accepted in exchange for goods and services.

> Orthodox (neoclassical) economists like Mankiw tend to be very strongly pro-corporate due to way funding flows in the profession.

This borders on conspiracy theory. I was in an econ PhD program for years (though I never quite finished the dissertation), and trust me, economists working in the neoclassical tradition do not need corporate funding to be right of center. Most academic economists aren't getting corporate funding.

And there are plenty of left-wing economists whose work is nevertheless mainstream in the sense of living within the neoclassical paradigm.

> The myth is that barter arose spontaneously throughout history and that currency arose as a more efficient means of mediating barter.

Economists mostly don't care how money arose, and 99.999% of theories in economics would be unchanged if money arose after barter, after credit and debt, or as a result of aliens implanting the idea in ancient peoples' brains.

>This borders on conspiracy theory.

I find it overwhelmingly ironic that economists consider "people respond to incentives" as a fundamental building block of economic theory but when the topic is "do economists respond to incentives?" the answer is no, they are only interested in truth.

>Most academic economists aren't getting corporate funding.

Most programmers arent employed by FAANG but that doesnt stop armies of the ones that arent from idolizing the goog. Using money to build prestige that goes with money does a better job than straight up bribery.

Economists are the best paid social scientists by far thanks to the injection of money. Having a seat at the policy table has its advantages - advantages that anthropologists dont get.

>And there are plenty of left-wing economists whose work is nevertheless mainstream in the sense of living within the neoclassical paradigm.

I wonder if you are using, say, Paul "footsoldier of the DNC" Krugman as an example of "left wing" here because I cant think of any.

>Economists mostly don't care how money arose

The book addresses this point and explains why Adam Smith (and subsequent thinkers) did care. It's worth a read.