Prestation and Market Exchange

PRESTATION AND MARKET EXCHANGE

by Antonio C. Antonio

February 28, 2014

Question:  “Would you prefer prestation over market exchange for marginal upland farmers and indigenous peoples?  Why? What would your choice’s effect be on the environment, social and cultural conditions? (Prof. Janet B. Martires)

Prestation is an obligation in exchange for goods and services rendered.  Payment could come in the form of goods and services too.  Under the Feudal Law, prestation is also described as payment in return for the lord’s warrant or an authority for taking wood.  In modern Philippines, it could be compared to a permit to harvest timber products issued by the Department of Environment and Natural Resources (DENR).  Under the Civil Code, prestation is a performance of something due upon an obligation… in Pilipino: “kabayaran sa pagkakautang” or “bayad utang.”

On the other hand, market exchange is a manner of exchange (of money, goods and services) which implies both a specific location for transactions and the sort of social relations where bargaining can occur… in Pilipino: “tawaran.”

Choosing between prestation and market exchange is like looking for distinctions between a green and red apple… they are the same fruit bearing different colors.  Prestation and market exchange are basically the same and belong to a bargaining system or procedure.  If we look at these terms from the process standpoint, prestation is the end result of a market exchange.  Both are part of a process flow and one cannot function and exist without the other.

The biggest malaise in the upland involving the indigenous communities and the lowland stakeholders is the unequal distribution of benefits from the natural resources that is available there.  For example:  The upland communities want the entire forest for themselves since they call it home;  The government want to generate revenues out of timber resources because most areas where there are forest are public lands; and, Private businesses, who provide the financial resources to effect harvesting operations, want reasonable returns for their investments.  The clash of interests between these three major actors in the upland often result to a very uneasy relationship among them… often heated arguments and confrontations occur.  Maintaining peaceful co-existence among the three actors remains to be a big challenge.  It is for this reason that an acceptable system of market exchange and prestation should be the dominant influence to keep all three actors talking, bargaining and agreeing on mutually beneficial terms and conditions.  In most instances, all three upland actors find middle grounds for all of them to agree on.  More often too, environmental protection, aside from mere monetary considerations, becomes a central issue in the negotiations.

Just my little thoughts…