Internet reduces transactions costs, encourages barter
Today's New York Times carries a story by Warren St. John on the vogue for bartering: Let's Make a Deal: Barter in a No-Cash Economy. Nice overview of the tradeoffs of barter vs. cash transactions. For example, barter is somewhat more information intensive that cash transactions:
- "Many of the ads [posted on Internet barter pages - Ben] are not for goods, but for professional services like Web design, housecleaning and massage. Other service industries are represented as well. Last week on Craig's List, a dominatrix offered to trade her services (along with "dungeon rental") for plane tickets, carpets, tiling work and an antique couch.
Reached by telephone, the dominatrix, who asked not to be identified, said she had traded successfully for an accountant, movers and housecleaners. She had this advice for prospective barterers:
"You need to be incredibly specific in your ad � spell it out like you're talking to a child. Otherwise, your mailbox will be flooded with stupid questions." "
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