Four Forms of Exchange by Aristotle

Exchange is the act upon which an individual must give in order to receive.

Natural and unnatural forms of exchange are thought of as needs and desires, respectively. 

​Aristotle viewed barter, monetary, retail sale, and usury as forms of exchanges. 

​This post will briefly go over these four forms of exchange, as distinguished by Aristotle. ​

To begin, barter exchange is a non-monetary form of direct exchange of commodities. Barter is when a commodity is exchanged directly with another commodity. 

He viewed this form as good, or natural, but found barter to be inconvenient. This leads to an absence of the coincidence of wants and inconsistency in the exchange ratio.

Monetary was also seen as good, and natural, in the eyes of Aristotle. This form of exchange is when a commodity is indirectly exchanged with another commodity. 

​It begins with a commodity, then this commodity is sold for money and the money is used to buy a desired commodity. 

Retail Sale is the next form of exchange to Aristotle. This form used money to obtain a commodity to only be sold for more money. He viewed this form of exchange as bad, and unnatural, since the end result is not of use value. 

​This could be thought of as modern day scalping, which is not usually looked down upon within the economic community. Since, it is voluntary and both sellers and buyers benefit from actions taken.

Lastly, usury is more or less the form of exchange Aristotle hated the most. This form does not include commodities, but only money. 

It is the use of money to gain more money without obtaining a good or service nor an end use value. Usury is also looked upon by Aristotle as unnatural.