Barter, Credit, and Welfare: A theoretical inquiry into the barter phenomenon in Russia

Jose Noguera and Susan Linz

No wp757, William Davidson Institute Working Papers Series from William Davidson Institute at the University of Michigan

Abstract: This paper develops a model to investigate the welfare implications of barter in Russia and other transition economies during the 1990s. We argue that barter is a welfare-improving phenomenon that acts as a defense mechanism against monetary instability. When firms react to tighter credit markets by switching to barter, the risk they face diminishes, allowing for a higher level of production.

Keywords: Barter; welfare; Russia; money; credit; payment system; interest rate (search for similar items in EconPapers)
JEL-codes: E0 E6 P20 P21 P23 P26 (search for similar items in EconPapers)
Pages: pages
Date: 2005-03-01
New Economics Papers: this item is included in nep-cis, nep-mac and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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