The Nature of Economic Exchanges
Olivier Massin (olivier.massin@unige.ch), University of Geneva, dpt of philosophy
Emma Tieffenbach (emma.tieffenbach@unige.ch), University of Geneva, Swiss
Center for Affective Sciences
1. Introduction
Julie sells her bike to Paul. Exchanges of this sort are ubiquitous economic
phenomena, so that economics is sometimes defined as the science of exchanges1. Yet
the precise nature of voluntary economic exchanges (henceforth, exchanges tout court) is
not entirely clear. In the limited space of this paper, the outline of an account is
proposed. An exchange, we submit, is a three-staged episode involving, first, two
converging preferences on the part of the traders over certain courses of action, followed
by a stage during which an offer made by one of the two is accepted by the other, and
which resumes in the provision of the goods or services.
The first part explains why the proposed account is only apparently at odd with
three commonly shared assumptions about exchanges, namely, methodological
individualism, value subjectivism and rational choice theory. The second part spells out
in more details the three stages of exchanges and the explanatory connections between
them. The third part addresses some of the worries that the present account may raise.
1. Three neglected features
Three widely shared assumptions about exchanges are:
1. Exchanges by nature compatible with methodological individualism (roughly the view that
only individuals are thinking and acting): the nature of exchange involves no “we”.
2. Exchanges are by nature compatible with value subjectivism (roughly the view that there
are no objective values, that is, no values lying outside to scope of valuations such as
finding x good, believing that x is good, liking x, etc.): the nature of exchanges
involves no “good”.
1 See Kirzner (2007, 72 sqq.) for an historical overview of that proposal, and Buchanan (1964) for a
defence of it.
3. Exchanges are by nature compatible with rational choice theory (roughly the view that
agents always choose the option with the highest expected utility). The nature of
exchange is such that they are expected to be mutually beneficial2, in the sense that
exchanges satisfy some the preferences of both exchangers.
In sum, neither collective intentionality nor objective values are needed for exchanges to
take place, yet exchange benefit to both parties. Hence exchange can play a key role in an
individualist, value-free economic science. It also falls within the scope of rational choice
theory.
Although we do agree with these three assumptions, we shall emphasize three
essential, but neglected, features of exchanges, which at first sight seem to clash with
them.
1. First, although collective intentionality is indeed superfluous in the definition of
exchanges, we shall argue that social acts, i.e., acts which require more than one
individuals, are needed. An exchange, on our view, involve in particular an offer and an
acceptance.
2. Second, although objective values are dispensable in the definition of exchanges,
objective norms aren’t. Claims and obligations (ensuing from offers and acceptances) are
part of the very nature of exchanges. Hopefully though, this normativity of
exchanges represents no substantive threat to the aspiration of economic sciences to
remain “value-free”. This is because, as we shall see, the reason why objective claims
and obligations are essential parts of an exchange has nothing to do with some
preferences, or individual valuations, being more correct than others. The reason
why such claims and obligations arise is precisely that all exchanges involve an offer,
which amounts to a kind of conditional (and often tacit) promise3: Julie promises to
Paul to transfer her bike to him if Paul transfers a certain amount of money to her.
Following Reinach (Reinach 1913), whom we shall largely adopt here, this promise,
simultaneously generates Julie’s obligation to transfer her bike to Paul if Paul pays
her, on the one hand, and Paul’s claim to get Julie’s bike if that same condition is
met, on the other. That exchanges are partly normative shouldn’t be surprising.
See Menger, 2007, p. Nozick, 1974, p. 63. “Mutuality of advantage from voluntary exchange [...] is
the most fundamental of all understandings in economics” (Buchanan, 2001, p.29; emphasis added).
3 Not all offer involves a promise. Sometimes, to make an offer amounts to give someone something
and express the wish that the recipient of one’s gift gives something in return.
2
Suppose Paul gives the money to Julie, and that Julie leaves with both the money and
the bike. Obviously this is something she shouldn’t do: the reason why she has an
obligation to transfer her bike to Paul, we argue, is that she made an offer to him,
and that Paul accepted it.
3. Finally, the productivity of exchange is widely accounted for in terms of “opposed
preferences” or “inverse valuations”4. The standard story goes as follows: Paul values
Julie’s bike more than his money; Julie values Paul’s money more than her bike,
hence exchanging the bike against the money would satisfy them both. On our view,
the preferences at stake are not opposed, but have (almost) the same content:
roughly, both Paul and Julie prefer that Paul transfers the bike to Julie and that Julie
transfers the money to Paul to the situation in which none of these transfers take
place. Also, the preferences are not affective — they are not about the respective of
value of the two exchanged goods. They rather are conative: Julie and Paul prefer
that some course of action take place. It is these converging and conative preferences
that are essentially satisfied in exchanges, rather than the inverse, affective
preferences that may motivate each of them. We shall advance two arguments for
that claim: first, only these converging preferences are essential to the exchange, the
inverse preferences being motivationally farther from the initiation of the exchange.
Second, in cases of exchanges of services, it is very hard, if not impossible, to
accommodate opposed preferences. If Paul purchases a bike-riding course to Julie, it
is not necessarily the case that Julie prefers Paul’s money to a biking course. We
believe that the theory of exchange have been led astray by focusing two much on
the exchanges of tangible goods, understood as enduring substances, and not enough
on the exchanges of services. Yet even when we exchange goods, what we exchange
more immediately are services or actions (namely transfers of goods). If an exchange
is an exchange of actions, rather than an exchange of goods, the implication
concerning the way it is beneficial is as follow. Assuming the satisfaction of conative
preference counts as a benefit, an exchange will be beneficial simply (and quite
trivially) by the mere fact that it takes place in accordance with the conative
preferences which motivate it. Unproductive exchanges are not those, as the
common view has it, by which agents are disappointed, ex post, with what they
preferred to exchange. Unproductive exchanges are those that happen.
4
Menger 2007, p. 179, Von Mises 2007, p. 204.
In sum, the view of exchanges defended here put emphasis, without entirely giving up
the three standard assumptions above, on the social acts, the norms, and the actions
(rather than the goods) that lies at the heart of exchanges.
3. An outline of the POAP view
Here is a general outline of the picture of exchange we propose. An exchange is an
episode that involves three essential stages, each being grounded on the former and vice
versa.
1. Preferences and beliefs. The first stage only involves each party’s private mental states:
each has a preference of a given sort, and at least one of them has a belief, whose
content will be specified below.
1.1. The preferences. The preferences needed are of the following sort:

Julie prefers that she transfers her bike to Paul and that Paul transfers his
money to her, rather than that she does not transfer her bike to Paul and
that Paul does not transfer his money to her.

Paul prefers that he transfers his money to Julie and that Julie transfers her
money to him, rather than that he does not transfer his money to Julie and
that Julie does not transfer her bike to him.
More generally, symbolizing the particular actions involved (here the action of
transferring goods) by Greek letters, and the agent at stake by “A” and “B”, the two
preferences have the following forms:

A prefers [(to φ and that B does ψ) to [(not φ and that B does not ψ)]
AND

B prefers [(to ψ and that A does φ) to [(not ψ and that A does not φ)]
A couple of comments are needed. Note first that, on the proposed account, the
preferences that are essential to exchanges are directed at the actions5 of the exchangers
(here, transferring the bike/the money), rather than at the goods of the exchangers (the
bike, the money). One reason in favor this view is that, as w shall shall see, it paves the
way to a unified account of the exchanges of concrete goods and services.
Second, one might be tempted to think that the two preferences at stake have
exactly the same content, namely:

A prefers [(that A does φ and that B does ψ) rather than [(that A does not φ
and that B does not ψ)]
AND

B prefers [(that B does ψ and that A does φ) to [(that B does not ψ and that
A does not φ)]
We think that this temptation should be resisted though, because of the idea that
one of the action that each party prefers is an action of himself, rather than of the other,
has been lost in the translation. If one wishes to use “that” clauses nevertheless, then one
has to introduce “himself” to mark this distinction, in the following way:

A prefers [(that A himself does φ and that B does ψ) rather than [(that A
himself does not φ and that B does not ψ)]
AND

B prefers [(that B himself does ψ and that A does φ) to [(that B himself does
not ψ and that A does not φ)]
Here again, it is clear that although both preferences are converging, they don’t have
exactly the same content: the ownership of the actions differ in both cases6. (This will
What is exchanged may not be an action but its forbearance. A case in point could be that of the
victim of a blackmailer who buys the latter’s silence. See also Nozick’s example of someone who offers to
pay his neighbour for not going on with his plan to erect an ugly building in his garden (Nozick 1974, p. ?)
5
An analogous worry is discussed in connection to the Meinong-Chisholm reduction of ‘S ought to
φ’ to ‘It ought to be that S φ-s’ , see Castaneda, 1970; Harman, 1973; Geach, 1991; Humberstone, 1991;
Schroeder, Broome.
6
prove important, notable, to understand the connection between the content of these
preferences and the content of offers, that we shall introduce below).
Second, no assumption is made here about the reason why the agent prefers some
course of action rather than the other. Rational choice theorists would urge that the
agents prefer the option with a higher probability to maximize their interest. Our account
is committed neither to the truth, nor to the falsity of this view. [We will latter defend the
possibility that exchangers are moved by Schafenfreunde — that Paul wants Julie’s bike
just for the sake of depriving her of a cherished personal good]. All that is needed at this
stage to explain exchanges are preferences over actions. No assumption is made with
respect to the instrumental rationality of these preferences.
Third, these two preferences are directed toward future actions. The preferences that
agents have at t1 are directed at actions being performed after t1. Beside, these actions
are actions that each party thinks are possible.
[Question : if we say that the realization of these preferences are believed to be
probable on certain conditions, namely, that an offer is made, can’t we get rid of the
belief in this way ?]
Fourth, these two preferences are private mental states: Paul does not necessarily
know about Julie’s preferences, nor Julie about Paul’s.
1.2. The belief. At this point, we have two agents with converging preferences: There
is a state of affairs that would satisfy them both. It is the situation in which Julie
transfers her bike to Paul and Paul transfers the money to Julie. How do we
move from these converging preferences towards the exchange? Although the
preferences of the parties are private, their expression or disclosure are not
required in order for Julie and Paul to move on to the next stage. All that is
needed to go further, we submit, is an offer from one of them to the other. In
order to make such an offer, one party must have, on top of his preference, a
belief.
In order to make an offer Paul, Julie must believe that making such an offer
would/is likely to bring her the money transfer she wants. If, on top of her preference,
Julie’s believes that offering to Paul that she transfers her bike to him if he transfers the
money to her is the best way to get Paul’s money, she may well proceed with making it.
Paul might not have any belief of the sort. Offers, we shall soon come back on this,
are to be understood as promises with conditional contents. What is needed to move
towards the offer, is one of these two beliefs:

A believes that [promising (to φ to B7 at the condition that B does ψ) is the
best way to make B does ψ.]
OR

B believes that [promising (to ψ to A at the condition that A does φ) is the
best way to make A does φ].
In sum, if (i) Julie prefers getting Paul’s money and giving him her bike, to not
getting Paul’s money and not giving him her bike, and (ii) if she believes that promising
to give her bike to Paul if he gives her his money is the best way of getting her
preference satisfied, she will proceed and make the offer.
Note that although these instrumental beliefs might be grounded in other beliefs
regarding the other party’s own preferences, they do not have to be so grounded. That is,
believing the other agent may accept the offer, does not entail forming any belief about
the other agent’s reasons for doing so, and in particular whether he prefers one’s good to
the money that is asked for it. True, Julie’s belief that Paul might accept her offer is often
justified by her attributing to Paul some (affective) preference for her bike. But this does
not have to be the case. There is no reason to speculate about the other agent’s
preferences in order to rationally make an offer to him. Julie does not need to know what
prompts Paul to accept her offer in order to make such an offer8.
7 Note that a gambling also involves an offer which consists on a conditional promise to transfer a
certain amount of money. But the condition of the promise is the occurrence of an event (,e.g., Joly
Jumper wins the course), whereas, in the case of an exchange, the condition is the transfer or a good on
the part of the offeree.
8 While Julie does not need to know what motivates Paul to accept her offer. Still, she needs to
attribute to him the disposition to accept her offer, and not only the disposition to act accordingly, that is,
to transfer his money. In other words, Julie needs to believe that when Paul transfers his money it is
because he has accepted her offer. Here is the argument. Suppose Paul is a robot who is programmed to
fulfill the condition of Julie’s promise (i.e. Paul is programmed to transfer he money whenever Julie makes
an offer to ‘him’). We submit that no exchange will have taken place between Julie and the Robot. Julie will
make an offer to Paul only if she believes he may accept it, and not merely behave as if he had accepted it.
2. The offer and the acceptance. The second stage consists of two sub-stages: the offer, and
its acceptance.
2.1. Offers are conditional promises in the sense of promises with a conditional
content9: Julie promises to Paul to transfer the ownership or possession of her
bike to him if he promises to transfer to her the ownership or possession of
some amount of money. Because of this offer, Julie incurs an obligation to
transfer her bike to Paul if Paul promises to pays her; and Paul has a claim to Julie’s
bike if he promises to pay her. Julie’s offer may be that she promises to transfer her
bike if Paul promises now. Paul may be offered the possibility to fulfill the
condition of her promise latter. In the related case of a delayed payment, Paul’s
claim on Julie’s bike would not have to wait for that payment to be done to be
activated. His claim on Julie’s bike would be activated now in so far as bay
promises to pay latter he would be satisfying the condition of Julie’s promise.
Still the obligation and the related claim are, at this stage, conditional: they are
real but unactivated, as it were. Both are waiting for the fulfillment of the
condition (that is, Paul’s promise/acceptance) in order to take effect. So at this
stage, the ball is in Paul’s court: it’s up to him to decide to promise/accept, or
not (he has no obligation to do so).
2.2. Second, the offer has to be accepted by the offeree. If he accepts the offer, Paul has
now the obligation to pay. Acceptance is an ambiguous term (Reinach 1913, p.
?). In the present context, accepting an offer is not simply uptaking it (that is,
hearing it, grasping it). To accept an offer is to let the offerer knows that one is
willing to incur the obligation to fulfill the condition of the offerer’s promise.
Acceptance is, in the context of an exchange, be a further social act. It is an
unconditional promise to realize the condition of the conditional promise which
is the offer. That is, for Paul to accept Julie’s offer to provide him the bike if he
9 The view that an exchange involves an offer with a conditional promise is defended by Bach (1995).
Reinach (1913 [1983], §3, p. 27) emphasizes the difference between conditional promises and
unconditional promises with conditional content. Offers are of the later type: the conditionality bears on
the content of the promise not on the act of promising. The contrast between the two kind of promises
corresponds to the following difference:
- Conditional promises: “If A happens, I will promise you (to p)”.
- Promises with conditional content: “I promise you (to p, if A happens)”.
Contrary to Reinach, we think that the opposition between conditional promises and promises with
conditional content is not so clear-cut. For a conditional promises is either not a promise (but a prediction
that a promise will be made); or it is a promise with conditional content:
“If A happens, I will promise you (to p) <-> “I promise you that (If A happens, I will promise you
(to p))”.
Conditional promises appear then to be second order promises with conditional content.
promises to pay her now (or either now, either latter10), is for Paul to promise to
pay her11.
3. The provisions. The last stage also divides into two sub-stages.
3.1. First, Paul takes the plunge and gives his money to Julie. At this first sub-stage
the offeror’s obligation stemming from the offer ceases to be conditional: Julie
has now an actual, non-conditional, obligation to give her bike to the offeree
(Paul); likewise, Paul has now an actual claim to Julie’s bike. It would be wrong
for Julie to leave with the money and the bike, because she would not then fulfill
her promise.
3.2. Julie transfers the bike to Paul.
4.
Explanatory connections: each stage is either motivated by the previous one or by the
stage that follows. That is, Julie makes the offer in the hope that this will allow her to
get the money she prefers. Likewise, Paul accepts the offers because of his former
preference. In between (2) and (3), Paul puts forward the money because he accepted
Julie’s offer. And Julie transfers the bike to him, because she promised to do so if
Paul promises to pay her. An exchange is not a process because its three stages are
internally, rather than causally, related to one another.
This definition of exchanges can be recapped thus (we assume here for simplicity’s
sake that A is the offeror):
Exchange=df Individuals A and B exchange goods x and y iff:
(1) Prefererences and belief:

A prefers [(to φ and that B does ψ) to [(not to φ and that B does not ψ)]

B prefers [(to ψ and that A does φ) to [(not to ψ and that A does not φ)]
The offerer’s promises may have disjuctive acts as its conditions.
As a follow up to to footnote n° 3 above, we shall specify that when somone offers a gift (e.g. the
provision of painting equipement during the following year) in exchange of something given as a quid pro
quo (e.g. an artwork), acceptance may not amount to a promise. As ingratefull as failing to give the artwork
in return may be, the related failure would not, or not obviously, be correctly described as a failure to keep
one’s promise.
10
11

A believes that [promising (to φ to B at the condition that B promises to
do ψ) is the best way to get B does ψ].
(2) Offer & acceptance:
(2.1) The offer: A promises to B that he will φ, if B does ψ. As a result, A
incurs the conditional obligation to φ if B ψ-s, and B a conditional claim to (A
does φ if he himself does ψ).
(2.2) B accepts the offer, that is, B incurs the unconditional obligation to
ψ by promising to ψ, and A an unconditional claim to B’s ψ-ing.
(3) Provisions. (3.1) B does ψ. As a result, A incurs the unconditional obligation
to φ, and B the unconditional correlative claim that A does φ. (3.2) A
transfers the possession or ownership of x to B. As a result, both A and B
have fulfilled all their obligations with respect to each other.
(4) Explanatory condition: (2) because of (1) and (3) because of (2). That is, (i) the
offeror must make the offer because of his preference; and the offeree must
accept the offer because of his preference. (ii) The first provision must occur
because the offer has been accepted, and the second provision must occur
because the offer has been made, accepted, and the first provision has been
made.
Our claim is that all these conditions are together necessary and sufficient for an
exchange to occur and that they tell us what an exchange essentially is. Before trying to
positively motivate this picture, let us address three couple of opposite [contrary] worries
that might arise readily.
4. Worries and their replies
The account outlined is likely to raise many criticisms.
1. Too simple? One first general worry is that exchanges, so construed are too simple.
Exchangers typically make their preferences clear to each other, they often negotiate,
sometimes the exchange involved more than three stages, more than two people, more
than two goods, etc. As an answer it should be urged that this three stages are not
claimed to be the only ones taking place in every exchanges. Often, exchanges involve
even more steps. For instance, the two parties expressing their preferences to each other
sometimes mediate the move from (1.1) to (1.2). But this step would not be mandatory:
Julie does not have to inquire about Paul’s preferences in order to make an offer to him,
even though knowing such preferences might lead her to make such an offer, or a better
one. 12 Disclosing one’s preference would facilitate the exchange without being an
essential ingredient.
Likewise, between the offer (2.1) and the acceptance (2.2), another intermediary
often takes place: a negotiation. The offeree might either ask the offeror to make him
another offer; or he might in turn make a counter-offer, thereby becoming the offeror.
While certain exchanges would collapse at stage 3 if its parties were prevented from
bargaining in this way, it needs not be a necessary component.
2. Too complicated? An opposite worry is that this sounds like a cumbersome
definition of a quite simple phenomenon. Exchanges are ubiquitous and very ordinary
social phenomena. The three-staged definition which we offered may prompt the
following reaction: Surely, exchanges are too trivial to be so complicated. This worry can
be partly answered by pointing out that the social acts involved in step (2). that is, the
offer (i.e. the conditional promise) and its acceptance often remain implicit or tacit. The
offeror usually does not pronounce “I promise you to…”. In commercial exchanges, offers
typically take the form of price tags. The way the market gardener promises the passer-by
to transfer a certain amount of apple to them if they give him a certain amount of
money, is just by putting a sign indicating “2 euros/kg” on the apple.
Likewise, the acceptance of an offer typically remains tacit, and is often stillborn.
Following Bach (1995), an acceptance is a promise to fulfill the condition of an offer. To
accept Julie’s offer to transfer her bike if he transfers his money to her, is, for Paul to
promise to transfer the money. But very often that promise is made and kept at once, just by
putting the money on the table. Not only is such a promise tacit, it is extremely short12 On this we disagree with Menger (2007, p. 179) when he says that the two individuals have to
« recognize the situation » (i.e. their inverse preferences) for the exchange to proceed. On our account,
exchanges can take place without forming any belief or idea about the other’s party preferences. The
participants in an exchange do not have to understand what happens : even if the exchange takes place
because it satisfies the conative preferences of each participants, none of them have to understand that this
is the reason why the other participate in the exchange. They might do so, they might realize why the other
party gets involved in this exchange, but they might as well ignore this, and proceed in a more solipsist
way.
lived, almost instantaneous. In this case, the very same act, i.e. the act of transferring the
good counts as both accepting the offer (2.2) and the first provision (3.1), thus activating
A’s obligation to transfer the good. The distinction between accepting an offer (2.2) and
the first provision (3.1.) is thus often so narrow that the two stages overlap in time and
get instanciated in the same act, although remaining conceptually distinct.
Finally, in the context of a wide market, the offeree does not even have to be singled
out: the preferences, the offer, the beliefs having that offer in its content, are often very
general: the offer is made to anybody. So the task of identifying the offeree can be
bypassed to this extent. The offer may be impersonal: it can be made to no one in
particular and the way to specify its content is: “I offer to whoever is interested in purchasing
this item to promise to give it to her or him if he of she gives me Euros 100.-”.
4. Too linear? Another worry, which we already hinted at, regards the order of
occurrence of the three stages or of some of their sub-steps. Indeed, things may not
happen in the exact, rigid order to succession that we suggested. It could be the case, for
example, that Paul never had the preference to buy Julie’s bike, nor even considered it as
an option, before Julie made any offer to him in this regard. This is just something that
never crossed his mind. In fact, his preference for exchanging his money with Julie’s bike
may well be formed after she made an offer to him13. If this is so, one should allow for an
inversion in the order of occurrence of B’s preference (initially occurring at stage 1.) and
A’s offer (Initially occurring at stage 2). The possibility that the offer elicited the offeree’s
preference for exchanging his good with her needs to be recognized. Note, however, that
the suggested inversion does not commit us to deny that “the offeree must accept the
offer because of his preference” only that “the offeree must accept the offer because of
his previously formed preference”.
5. Too normative? Then come the worry that exchanges, so construed, are essentially
normative phenomena, threatening the value-neutrality of economics. Because each
promise generates an obligation on the part of the promisor to keep his promise, and a
claim on the part of the promisee to the same effect, norms enter the scene in the second
step. After the offer (2.1), the offeror incurs a conditional obligation (A has the
13
ones.
See the notorious critics of capitalism as inducing preferences rather than fulfilling preexisting
obligation to transfer x if B transfers y to him), and the offeree has a conditional claim (a
claim to the transfers of x if B transfers y). After the offeree’s transfer (3.1) these norms
become non-conditional: A has the non-conditional obligation to transfer y to B, and B a
non-conditional claim to the same effect. All these norms are objective: neither figure
within the scope of an attitude: it is not that Julie thinks she has an obligation. She indeed
has one, whether she recognizes it or not. And the same hold for Paul’s claim. So from
the second step on, exchanges are norms-laden, on this view.
This is all true, but harmless, we submit. Note first that the normative phenomena
involved are norms (claims and obligations) rather than values (goodness, badness and
their species), so that strictly speaking, this views keeps exchanges value-free. Second, and
more to the point, no normative assessment of the preferences of the individuals is at play in
this picture. Nowhere it is claimed that individuals should prefer x to y, that it would be
more rational, required, moral or whatever to prefer x to y. To the extent that the
assessment of preferences is what economics science needs to avoid –which is often
claimed to be the case (Robins 1932 – that view of exchange remains value-free. Note
finally none of these objective norms remain after the end of exchange. After the second
transfer, neither Julie nor Paul has any more claim or obligation with respect to one
another. A long as the exchange goes through, these are all objective, but transient
norms.
The normativity of an exchange may further be questioned by means of the
following, seemingly, counter-example. Julie gives as a gift her bike to Paul, but soon
starts regretting her generous act. It is not that she wants her bike back —she hates
riding back— but she suddenly realizes that she could have sold it for a good price to
Steve. Now Julie confesses her regret to Paul who (quite surprisingly) reacts by offering
to Julie to give the amount of money she expected to get from Steve. Julie accepts Paul’s
proposition.
The example displays an inversion of stages (i.e. one sub-step of stage 3 —the
transfer of one of the two goods— now happens at stage 1.), it also is deprived of the
normative ingredients, which, on our view, are key components of exchanges. No
obligation nor any claim is ever incurred. There is an offer on the part of Paul (to give
some money to Julie), but it involves no conditional promise. It is also a case where one
of the parties, namely Paul, transferred his money without having any no obligation to do
so. And it is finally a case where the other parties had no related claim on the transferring
of other party’s good (and yet received it).
Although the case seems to blatantly mismatch our account, one may attempt to
accommodate it as follow. Maybe, what Paul exchanges with Julie is not her already
accomplished action to transfer the bike against his action to transfer the money. In spite
of appearance, Paul has not, or not only, bought Julie’s bike. What he has purchased is
rather is Julie’s forbearance of resentment against him. If this is so, Paul’s offer may
implicitly amount to the following conditional promise: “I offer to promise you to give
you Euros 100.- if you abstain from resenting me”. If Julie accepts the deal she incurs the
unconditional obligation to stop resenting him any longer. An exchange had happened.
This solution, however, is too speculating regarding the content of Paul’s preference
for being fully convincing. A more promising way of dealing with the case is to rule it out
as a genuine case of exchange. Indeed, Julie cannot offer to transfer a good she no longer
possesses. Nor can Paul offer Julie to promise to transfer his money against something he
already possesses. In order word, if Julie is not in a position, after she gave her bike to
Paul, to sell it to him, neither is Paul in a position to buy it from her. To be sure, it is
correct to describe to Paul’s proposition to give Julie her money as an offer. This term is
indeed broad enough to cover cases where gifts, rather than commodities, are
transferred.
6. Too demanding? On our account, Julie and Paul’s preferences may have (almost)
exactly the same content. We assumed that an exchange could not take place between
two persons who prefer two different couples of action (without being necessarily aware
of such divergence). Consider however the following case. Paul has no interest in Julie’s
bike but in Julie tout court. Paul’s love for Julie would make him do anything he can to
have a moment of interaction with her, including replying to her classified add that he is
willing to buy her bike. They meet, the exchange takes place, Paul has a great time.
Obviously, Paul and Julie’s respective preferences are not strictly converging. While,
Julie prefers to exchange her bike with Paul’s money rather than not, Paul prefers to
exchange her money with a moment of Julie’s time.
Granted, we should be more flexible in regard to the content of each trader’s
preference. Similarity is too strong a constraint. Sometimes people are not buying and
selling exactly the same thing. How divergent the two preferences can be? Any
divergence can be allowed, we submit, as along as it is compatible with the sort of actions
that both parties prefer from one another. Surely, Julie is not selling a moment of her
time. Yet selling her bike involves spending some time with Paul and so the divergence
between the two preferences is not a problem. Let the selling be via e-bay, however, and
the divergence of preference will be a problem.
7. Too collective? A third worry is that by putting social acts (offers and acceptances) at
the heart of exchange, it makes the latter incompatible with methodological
individualism: to exchange, individuals should be endowed with collective intentionality.
In other words, an exchange is a bona fide example of a joint action, performed by two
individuals together, endowed with some we-awareness and we-intentions.
This worry is misguided however. Although social acts do require more than one
individual (in the sense that they cannot be performed in isolation) they do not require
any form of we-ness. The promise that Julie makes to Paul has to be heard, and
understood by Paul. Unlike grieving someone’s death or forbidding someone, uptakes
are essential to the existence of promises, offers and acceptances (Reinach 1913). But the
promise remains Julie’s individual action, and the uptake Paul’s individual mental act, rather
than something they do together. Neither we-promises, nor we-uptakes are called-for.
Individualism is safe.
8. Not collective enough? The opposite worry, that is, that we pay to much lip service to
methodological individualism, may in turn be formulated against our account. The
objection is that an exchange is not just an aggregation of individual (albeit social acts) as
we suggest and that something more robustly collective is at play. Proponents of this
view may first point to the ordinary uses of the terms: “exchanges”. Consider what Julie
and Paul could readily answer to someone asking about what they are doing, A
forthcoming answer could very well be: “We are exchanging goods”. Now it would be
linguistically awkward on the part of Julie and Paul to answer: “We are all exchanging
goods” or “we both are exchanging goods”. But if the ‘We’ in the sentence: “We
exchange things” is not elliptical for “we both”, it indicates that it does not merely have
an aggregative or summative meaning. Julie and Paul seem to refer to what they collectively
do, without the latter being simply the sum of what they individually do.
One may however reply that if exchanges really were cases of joint actions, their
description would welcome the “together” or “jointly” modality, as in “we are walking
together”, or “we are jointly making the hollandaise sauce”. But exchanges clearly fail this
linguistic test: exchanging goods is not something Julie and Paul do “together”, even less
“jointly” so.
Conclusion
An exchange, we suggest in tis programmatic article, (i) is grounded in two
converging preferences (ii) involves an obligation from its parties to transfer their goods
(iii) is necessarily (albeit trivially) beneficial to its parties. In order to further support each
of these claims, the following questions will need to be separately addressed:
(i) What would be left out if, instead of assuming that agents prefer that certain
actions of exchanging goods takes place, we supposed that agents preferred certain
goods over others?
(ii) What would be missing if, instead of assuming that exchangers ought to mutually
provide their good, we supposed that an exchange is a convention, that is, a regularity of
behavior to which (i) everyone conforms, (ii) everyone expects everyone else to conform
and (iii) everyone prefers to conform on condition that the other does (Lewis 1969, p.
42).
(iii) What would be mistaken if, instead of assuming that agents promised to exchange
their goods, we explained the obligation they have in this regard as being a matter of (i)
an interest they have to signal to others their reliability as trustworthy partners (Posner
2000) or (ii) a joint commitment to intend as a body to transfer them (Gilbert 2013).
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