Transactionalism

In primitive societies the exchange of products between the tribes could be called as barter exchange.Goods produced in excess of their own demands were given to another tribe whose products were different.This practice of transaction had three levels namely- Reciprocity,Redistribution and Commercial Exchange.

Reciprocity - The excess produce was given away as gift to another tribe or society in need.This was not in expection of any returns.But in times of need this act was reciprocated by the other tribe.There was perfect understanding between the giver and the taker.

There is another type of reciprocity as among Trobriand islanders through Kula ring.Through trade,a society can dispose of goods,it has in abundance and obtain goods scarce in its own territory.Since trade transactions between neighbouring people may be crucial to their survival,it is important to maintain good relations.

Redistribution is the accumulation of goods by a particular person or in a particular place for the purpose of subsequent distribution.In societies that have political hierarchies it has become an important mechanism.The redistribution may be within the members of a family or within a community or society where there is a political apparatus to coordinate centralized collection and redistribution.

Market or commercial exchange is referred as exchanges or transactions in which the prices are subject to supply and demand.Market exchange does not only involve the exchange of buying and selling of goods.It also involves transactions of labour,land and credit.

According to anthropologists money performs basic functions of serving as a medium of exchange a standard of values and store of wealth.Also money is non perishable,transportable and divisible so that transactions can be made when the goods being purchased  differ in value.The money described is termed as general purpose money.

There is another category of money known as special purpose money.This consists of objects of value for which only some special goods or services can be excahnged on the spot or through balanced reciprocity.

General purpose money is a universally accepted medium of exchange.It is used for commercial transactions  and for non commercial transactions (taxes,fines,gifts and contributions).General  purpose money provides a way of condensing wealth.

All the transactions whether they be reciprocities,redistribution or commercial transactions involve cultural contacts and intermingling of tribes and societies  and that is why in cultural anthropology the term transactionalism has been introduced to explain diffusion and interactions of cultures between societies.