WWII and Cigarettes: An Urgent Lesson on Money and Value

28.11.2016 • The Economy

By Vivek Kaul – The Vivek Kaul Letter (India)-

I first came across this story while writing what became the first chapter of the first volume of the Easy Money trilogy. This is a story about cigarettes and how they were used as money in the prisoner-of-war camps during the Second World War. These camps had cropped up all over Europe during the Second World War.

The prisoners used to receive standard food parcels from the Red Cross during the War. The parcels included biscuits, butter, cigarettes, canned beef, chocolate, jam, milk, sugar, etc. As soon as the rations arrived, prisoners used to start exchanging them. One of the earliest transactions used to be non-smokers exchanging their cigarettes for chocolates that the smokers had got. Sikhs, who had been fighting for the British Army, used to exchange their allocation of beef for other goods like butter, jam, and margarine.

But gradually cigarettes went way beyond the status of a normal commodity and became the standardized medium of exchange i.e., they became money. A prisoner of war even recalls exchanges like “cheese for seven cigarettes” happening in the camps. He also recalls an individual who sold coffee, tea, or hot chocolate at the rate of two cigarettes a cup. This individual eventually scaled up his business but failed, making losses of a few hundred cigarettes.

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