What is the demerits of barter …

The disadvantages of barter system were Goods were limited, Need for Double Coincidence of wants, Difficulty of Division and Sub - division of Goods, Difficulty in calculating the value of goods, Difficulty in the case of services and Difficulty in Strong Value.

• In barter system the goods were limited. Barter system was lead only to lower level development.
• Barter system was good when needs were limited. Needs of man were increased but the supply of goods were not enough to satisfy man’s needs.
• Needs differentiate from man to man. If either parties get what they need then it is double coincidence. If not it is a trouble as they don’t get what they need.
• In the barter system it is difficult to divide and sub-divide goods.Posibility of exchange his good for only one good not for two or more.
• The value of the goods cannot be distributed equally as there were no measure during that period.
• The exchange of goods worth a service of a person was impossible as it was inconvenient to measure it. Barter sytem cannot exchange goods for services.
• Perishable goods could not saved as wealth for their future expenses. The economy could not contribute anything towards capital formation of the country too.