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Approaches To The Study Of Trade, The Formalist/substantivist Debate, Trade And The Development Of Civilization

Trade is one of the basic processes that link individuals and groups. Trade binds people to one another through the expectations of reciprocal giving, through the formal calculus of wages and markets, and through the desires or needs to obtain items not locally available. In this way, trade is a fundamental element of human culture.

Trade and exchange are often used synonymously, but there is a basic difference. Trade refers to the movement of goods between individuals or groups where there is a general expectation of reciprocity and where the purpose is basically utilitarian. Exchange has a broader meaning, encompassing all movements of goods. The general expectation of reciprocity need not be a part of exchange, nor does exchange have to be utilitarian in nature. In contrast, both are central to trade.

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