Gifts versus Commodities
In pre-capitalist ‘traditional societies’ reciprocal transactions tended to take the form of gift exchanges. But a gift exchange is not at all the same as a market exchange. It is driven by a totally different kind of dynamic.
Christopher Gregory in his ‘Gifts and Commodities’ (1982) draws on Marx’s insights to pinpoint the difference:
‘Marx was able to develop a very important proposition: that commodity-exchange is an exchange of alienable things between transactors who are in a state of reciprocal independence […]. The corollary of this is that non-commodity (gift) exchange is an exchange of inalienable things between transactors who are in a state of reciprocal dependence. This proposition is only implicit in Marx’s analysis but it is […] a precise definition of gift exchange.’
In a market economy, the buyer and seller confront each other as two separate individuals having diametrically opposed interests as far as the price of the commodity being sold is concerned. They haggle over it and, once a deal has been struck and a price agreed (which will tend to fall somewhere in between what both would have respectively wanted), they go their separate ways.
Rather than some ‘natural propensity’ to engage in self-interested economic behaviour giving rise to a market economy, it was the very growth of a market economy that gave rise to this concept of self-interested economic behaviour. The absurdly unrealistic depiction of human beings as ‘homo economicus’ who only act to maximise what they individually gain from any transaction is the cornerstone dogma of modern economic theory. It springs from an essentially individualistic worldview (implied in the very concept of ‘self-interest’) which was largely bound up with the development of a market economy itself.
Where market transactions tend to atomise and separate individuals, gift transactions move in a quite opposite direction – to cement and solidify social relationships between people by binding them together in a whole host of open-ended and continuing rights and obligations (called ‘total prestations’ in the literature) of which the exchange of material goods plays a more symbolic role. Moreover, the ongoing nature of these rights and obligations is quite different from a market transaction. Once the buyer has bought a commodity from a seller, their relationship to the latter, in theory, ceases forthwith. This is not so in the case of a gift transaction.
In his seminal essay ‘The Gift’, written in 1925, Marcel Mauss refers to the quasi-mystical explanation for the existence of gift transactions offered by a Maori sage called Tamati Ranapiri. The spirit of the giver called the ‘hau’, suggested Ranapiri, resides in the gift itself. Though the gift may pass through many hands it always seeks to return to its original source. An example of this was ‘Kula ring’ described by Malinowski in his The Argonauts of the Western Pacific (1922). This curious social phenomenon involved the circulation of two sets of ceremonial items – shell necklaces and armbands – each going in opposite directions around a group of far-flung island communities in the Western Pacific, via the mechanism of gift exchange.
Here too we witness behaviour driven by a belief that the ‘spirit’ of the giver must return to its source. For instance, it would be considered deeply offensive to hang on to a particular item, thereby disrupting the circulation of goods, let alone to haggle over it as one might with an object of commerce. Of course, we don’t need to interpret this belief that the ‘spirit’ of the giver is entangled in the gift itself, too literally. It is really about the entanglement of communities with each other. As such, it is better understood as a metaphor or ‘motivating myth’, fostering a sense of inter-communal solidarity.
Nevertheless, the inalienable character of the gifts being exchanged brings out a core difference between ‘gift economies’ and capitalist market economies where, in the latter case, we find that the producers – the workers – are permanently alienated or separated from their products. The ‘spirit’ of the workers is completely expunged from the product of their labour by the capitalists who assume complete ownership of it.
Another difference is that, contrary to explanations offered by the market apologists, not only did gift transactions predate market exchanges but they also involved voluntary contractual relations, not between individuals as such, but social groups. In other words between, ‘clans, tribes and families’ as Mauss put it. This runs completely counter to individualistic explanations for the origins of exchange. However, according to David Graeber:
‘Over time, Mauss argued, reciprocity can also take on a more competitive cast as assertive individuals – first acting as representatives of clans or other social groups, later in their own capacity (Parry 1986) – end up vying to see which can outgive the other’ (Towards an Anthropological Theory of Value, 2001 p.160).
This is illustrated by the famous potlatch ceremonies carried on amongst the Kwakiutl people on the Northwest Coast of North America.
This was no longer strictly a ‘gift economy’, more a competition over status which became an enshrined principle of ‘aristocratic societies’ predating capitalism. Some commentators distinguish between this and the modern capitalist notions of status in that while the latter is based on the conspicuous accumulation and consumption of wealth, the former involves the periodic giving away of wealth. If so, the difference is one of degree rather than kind; in capitalism too we find wealth being conspicuously given away in the guise of ‘philanthropy’.
The point about competitive gift giving is that it can serve as a means to acquire prestige and hence power within a kind of patron-client set up more typical of pre-capitalist societies. Through it the client becomes indebted and subservient to the patron. This is what facilitates the direct appropriation by a ruling class of an economic surplus from its subjects in a society like feudalism rather than indirectly through the economic mechanism of ‘free’ waged employment under capitalism.
A socialist gift economy?
What of the alternative to capitalism? Socialism has sometimes been described as a kind of ‘gift economy’ where the relations between individuals are based on a system of ‘generalised reciprocity’. That is not a bad description though one might quibble over applying the term ‘economy’ in relation to socialism. As suggested, the identification of a something called the ‘economy’ is something peculiar to capitalism. The universalisation of money-based relationships makes for a kind of vast impersonal mechanism operating according to its own laws and ‘behind the backs of the producers’, as Marx put it. Alienation, the separation of the producer from her product, seems implicit in the very conception of this thing we call ‘the economy’. Socialism might be better described as a way of life than an economy.
According to the anthropologist Marshall Sahlins, there are three basic forms of ‘reciprocal exchange’.
Firstly there is ‘balanced reciprocity’ where there is expectation of an immediate return on what is being offered for exchange. This is the norm under capitalism. We can take an item off a supermarket shelf and walk off with it but only on condition that we exchange cash for it at the cash till.
Then there is ‘negative reciprocity’. As the term itself suggests this involves the use of coercion by one party to a transaction to impose disagreeable terms or conditions on the other. The high prices charged by a monopoly which customers have to accept is one example of this. Another is the generalised system of wage labour intrinsic to capitalism itself. This arose partly out of the coercive dispossession of the majority of their limited means of wealth production, forcing them to depend on wage labour in a process called ‘primitive accumulation’ which is still going on today in the form of land grabs in places like Africa.
Finally, there is ‘generalised reciprocity’. Here there is no expectation of an immediate return at all. Nor is there even an expectation that the person making the return should be the same person to whom the gift in question was first offered. As in the case of the Kula ring, the good can pass through many hands. There are many other examples of generalised reciprocity in both preindustrial and capitalist societies.
The tradition of extending hospitality to strangers in Bedouin and other preindustrial cultures is a form of generalised reciprocity. In modern day capitalism, the internet has often been cited as a working example of a gift economy in practice. Individuals voluntarily, and without thought of payment of any kind, contribute time and effort to the stupendous storehouse of information available to everyone that is the internet. As Genevieve Vaughan notes:
‘Actually the market is limited and floating on a sea of gifts. Profit itself is a gift as it comes from the part of the labor of workers which is not covered by the salary, their so-called ‘surplus labor’. But there are also the gifts of housework and of nature which are exploited by the market, which does not have to pay for the reproduction of the workers or the clean-up of pollution. As someone said in the recent movie on the internet gift economy, Us Now, the kind of capitalism we are living in has only really been so extreme during the last century’ (gift-economy.com/theory-and-practice-of-the-gift-economy).
These kinds of extant non-market relations might be said to validate and further strengthen the case for a completely non-market socialist future which, in a sense, they prefigure. What they highlight is precisely what the ideology of the market seeks to conceal – our mutual interdependence.
Recall Gregory’s thoughts on Marx’s insights into the nature of commodity-exchange as being an ‘exchange of alienable things between transactors who are in a state of reciprocal independence’. This idea of ‘reciprocal independence’ is a logical extension of the dogma that the market economy is a purely voluntary and non-coercive institution. To be independent is to be ‘free’.
But the idea flies in the face of reality and fails to see the wood for the trees – the larger patterns of social interconnections that bind us all. The great majority of us, possessing little or no capital, are economically obliged to sell our working abilities to the tiny minority who own this capital. There is nothing voluntary about this; it is a brutal coercive structural fact arising from the class nature of capitalism itself.
Though capitalist ideology can hardly suppress the empirical fact of our practical dependence upon each other as human beings, what it does is to fall back on a second line of defence, as it were, taking this concept of practical dependency and twisting it into something else. Instead of being universally reciprocal it is presented as being something partial and one-sided: the workers are said to depend on the capitalists. The dependence of the capitalists upon the workers is thus ideologically erased by a sleight of hand.
The essence of the gift relationship is the sense of moral obligation it confers upon the recipient of the gift to give something back in return. In capitalism, it is used to entrench the existing social order by inducing a contrived sense of dependency of one class upon the other. Notwithstanding a market ideology emphasising the ‘reciprocal independence’ of buyer and seller, capitalism needs to create some sense of community in which individuals are bound together by bonds of moral obligation.
Socialism too will need to do this as must any kind of functioning society. However, the manner in which socialism will do so will be quite different. The very term itself – ‘socialism’ – springs from the recognition of the completely socialised nature of modern production. There is literally nothing that is produced today that does not involve, directly or indirectly, the input of millions of workers right across the world. Socialism is about bringing ownership of the means of producing wealth into line with the character of modern production.
The recognition that we necessarily depend upon each other, will translate into a generalised sense of obligation to contribute to the good of others, as well as ourselves in a society fundamentally based on the principle of generalised reciprocity.