The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd


  • Dalia Marin
  • Monika Schnitzer
Reference work entry


International countertrade – tying an import to an export – emerged in the 1980s in response to the international debt crisis. Barter – the exchange of goods without using money – re-emerged in transition economies in the 1990s, in response to a domestic debt crisis. Both phenomena can be explained as institutional responses to contractual problems arising in imperfect capital and goods markets. Countertrade introduces a deal-specific collateral that improves the creditworthiness of countries and firms, and facilitates technology transfer to developing countries. Barter helps to overcome the lack of trust problem in the former Soviet Union.


Asymmetric information Barter Buyback Collateral, deal-specific Commitment Contract enforcement Counterpurchase Countertrade Creditworthiness Credit constraint Cross-subsidy Foreign direct investment Foreign exchange shortage Incentive contracts International debt crisis Liquidity constraints North–South economic relations Planning Price discrimination Reputation Social networks Social norms Soft budget constraint Transfer of technology Trust, lack of Virtual economy 

JEL Classifications

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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Dalia Marin
    • 1
  • Monika Schnitzer
    • 1
  1. 1.