The role of neo barter and labor exchange in poverty alleviation

Abstract

Using the articulation of modes of production theory and other Marxist paradigms, the study sets to establish how traditional and contemporary barter exchanges of goods and services are important today in a capitalist monetary system. The study argues that no single capitalist system today can alleviate the poverty that ravages the Third World Countries. Instead other conventional and unconventional strategies should be revisited in the fight against poverty. The inherent contradictions, conflicts and tensions introduced by the colonial capitalist regimes have resulted in the dependency and poverty affecting the Third World Countries today. Capitalism has proved incapable of transcending fundamental weaknesses such as under-utilization of productive capacity, the persistence of a permanent sector of unemployed and periodic economic crises related to the concept of 'market' -which is concerned with people's ability to pay rather than their need for commodities. Notwithstanding, economists still are taught that barter is "primitive" rather than seeing its new role in thousands of high-tech, money-free trading systems in today's capitalist economies. This is not to say that barter trade alone can bring about development but should be a component in a larger framework in the fight against poverty. The overall objective of this study was to establish the role of barter in alleviating .poverty in today's capitalist monetary system. The focus of the research was on small and medium scale farmers, squatters and small traders in Bahati Location, Nakuru District. Bahati Location has a total of 12, 383 households. A population sample of 101 respondents was obtained through stratified sampling for the quantitative data and a further 16 respondents for the qualitative data. The population of the location was divided into strata made up of sub-locations and then a sub-sample from each of the strata was selected using judgment sampling. The quantitative data collected was analyzed on SPSS for both inferential and descriptive statistics. The qualitative data was analyzed using coding frames developed from the transcripts. The data has been interpreted using percentages, frequency distributions, tables and graphs. From the research findings it is clear that barter is well entrenched in the social and economic activities of the rural community under study. The farmers, squatters and traders alike cited that they engage in barter on a daily basis. To a larger extent barter trade and labour exchange alleviate poverty. Poverty in this document refers to absolute poverty. It means lack of cash and basic human needs such as food, shelter and clothing. From the research findings lack of money is a major handicap for the rural poor. About 65% of the respondents had a monthly household income of less than Kshs.lO,OOO/=. With such meager incomes, most rural communities cannot afford to meet their basic needs. Not surprising, 75% of the respondents cited to have engaged in barter exchange as an alternative to cash. It allows the rural people to exchange foodstuffs and labour in order to meet their basic needs. This is not to say that barter alone can bring about tangible development, instead barter should be incorporated in modern economies to act as an alternative to cash and to specifically address the basic human needs like food and clothing, which the capitalist system has inadequately addressed. There is no doubt that there is a higher value attached to money than barter. This is mainly because money is more widely acceptable than exchange. Paradoxically if barter was practiced more widely with well established channels of trade like there are in the contemporary money markets, barter trade could be more acceptable. It is not surprising therefore that 75% of the recommendations suggested by the respondents and the research is to establish channels of barter trade. This would enhance exchange activities by diversifying the product range and quality of the trade. With the establishment of exchange channels there would be need to standardize measures of trade in order to create a fair trade. This would authenticate the trade. The coining of the term neo-barter in this research as opposed to the term traditional barter was substantiated by the respondents who indicated that the current exchange is modern and progressive because it exists alongside cash economy. It provides the option of exchange or cash. On the other hand, traditional barter is seen as old fashioned, rigid and not conducive in a modern economy. The research findings support the proposal assumption that barter trade and labour exchange still play a significant role in alleviating poverty amongst rural communities.