Editing Medium of exchange (section)

{{Short description|Method by which value is transferred between parties}}
{{Essay-like|date=March 2019}}
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In [[economics]], a '''medium of exchange''' is any item that is widely acceptable in exchange for goods and services.<ref name=":0">{{Cite book|last=Black, John, 1969

|url=https://www.worldcat.org/oclc/970401192|title=A dictionary of economics |others=Hashimzade, Nigar,, Myles, Gareth D.|year=2017|isbn=978-0-19-181994-0 |edition=5|location=[Oxford]|oclc=970401192}}</ref> In modern economies, the most commonly used medium of exchange is [[currency]]. Most forms of money are categorised as mediums of exchange, including [[commodity money]], [[representative money]], [[cryptocurrency]], and most commonly [[fiat money]]. Representative and fiat money most widely exist in [[digital currency|digital form]] as well as physical tokens, for example [[coin]]s and notes.

The origin of "mediums of exchange" in human societies is assumed by economists, such as William Stanley Jevons, to have arisen in antiquity as awareness grew of the [[barter#Limitations|limitations of barter]]. The form of the "medium of exchange" follows that of a token, which has been further refined as [[money]]. A "medium of exchange" is considered one of the [[Money#Functions|functions of money]].{{r|mankiw|krugman|abelbernanke}} The exchange acts as an intermediary instrument as the use can be to acquire any good or service and avoids the [[barter#Limitations|limitations of barter]]; where what one wants has to be matched with what the other has to offer.<ref>William Stanley Jevons, 1875. 'Money and the mechanism of exchange' Chapter 1 http://oll.libertyfund.org/titles/jevons-money-and-the-mechanism-of-exchange</ref><ref>{{Cite web|url=https://www.investopedia.com/terms/m/mediumofexchange.asp|title=Medium of Exchange Definition}}</ref> However, there is little evidence of a pre-monetary society in which barter is the primary mode of exchange;<ref name="Humphrey, Caroline 1985">Humphrey, Caroline. 1985. "Barter and Economic Disintegration". Man, New Series 20 (1): 48–72.</ref>
instead, such societies operated largely along the principles of [[gift economy]] and [[debt]].<ref>[[Marcel Mauss|Mauss, Marcel]]. ''The Gift: The Form and Reason for Exchange in Archaic Societies''. pp. 36–37.</ref><ref>{{cite web |url=http://www.nakedcapitalism.com/2011/08/what-is-debt-%E2%80%93-an-interview-with-economic-anthropologist-david-graeber.html |title=What is Debt? – An Interview with Economic Anthropologist David Graeber |publisher=[[Naked Capitalism]]|date=2011-08-26 }}</ref><ref>David Graeber: ''Debt: The First 5000 Years'', Melville 2011. Cf. [http://socialtextjournal.org/a-history-of-debt/ review]</ref>