Natural economy
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Natural economy is a type of economy in which money is not used in the transfer of resources among people. It is a system of allocating resources through direct bartering, entitlement by law, or sharing out according to traditional custom. In the more complex forms of natural economy, some goods may act as a referent for fair bartering, but generally currency plays only a small role in allocating resources. As a corollary, the majority of goods produced in a system of natural economy are not produced for the purpose of exchanging them, but for direct consumption by the producers ( subsistence). As such, natural economies tend to be self-contained, where all the goods consumed are produced domestically. The term has often been used in opposition to other forms of economy, most notably capitalism. Rosa Luxemburg believed that the destruction of the natural economy was a necessary condition for the development of capitalism.
Karl Marx Karl Marx (; 5 May 1818 – 14 March 1883) was a German philosopher, political theorist, economist, journalist, and revolutionary socialist. He is best-known for the 1848 pamphlet '' The Communist Manifesto'' (written with Friedrich Engels) ...
described the
Inca Empire The Inca Empire, officially known as the Realm of the Four Parts (, ), was the largest empire in pre-Columbian America. The administrative, political, and military center of the empire was in the city of Cusco. The History of the Incas, Inca ...
as a "natural economy"; it existed as an isolated society which was based on subsistence and barter without profitmaking, with some products functioning as commodity money. Other writers have used a more relative sense of natural economy. Belgian economic historian Henri Pirenne noted that
medieval Europe In the history of Europe, the Middle Ages or medieval period lasted approximately from the 5th to the late 15th centuries, similarly to the post-classical period of World history (field), global history. It began with the fall of the West ...
has often been described as a natural economy despite the existence of money, since money played a much less significant role than in earlier or later periods.


See also

* Calculation in kind * Gift economy * Resource based economy *
Subsistence economy A subsistence economy is an economy directed to basic subsistence (the provision of food, clothing and shelter) rather than to the market. Definition "Subsistence" is understood as supporting oneself and family at a minimum level. Basic subsiste ...


References

Economic systems {{Econ-system-stub