This is a money parable, of course, and it captures the essence of the most important idea that has taken root in monetary economics in the last 30 years: Money is Memory. People use money in exchange because of information frictions - essentially limited recordkeeping, or limited memory.
Paul Krugman has been writing about stories recently, and he too finds these useful. Here's one of his:
Real business cycle theory says that economic fluctuations are the result of technological shocks, amplified by intertemporal labor substitution. My version: think of a farmer who faces sunny and rainy days. On rainy days his labor won’t be as productive as on sunny days; this effect on his output is amplified by his rational decision to stay in bed on rainy days and work extra hard when the sun shines. I think this gets at the essence of the concept; it also makes you wonder, is this really, really what you think happens in recessions?His RBC story is quite standard. The one I tell to students is pretty close to it. Again, it captures the essence of the idea. Of course, Krugman uses the story to make fun of the idea, but aside from the issue of whether the RBC model helps us understand recessions, the story is quite helpful. At the minimum it can help a student understand intertemporal substitution, which is at the root of much of dynamic macroeconomics.
I have a Keynesian story. There are two farmers, George and Martha (again). George grows peanuts, Martha grows cranberries. George eats only cranberries, and Martha eats only peanuts. These are weird peanuts and cranberries which sprout from the ground every morning, and have to be picked or they rot. Each evening, George and Martha meet at Martha's house, drink beer, and play cards. They get quite drunk, which is what it takes for them to settle down and negotiate the price at which they will trade in the morning. George's peanuts must be harvested before Martha's cranberries each morning. On a typical day, George gets out of bed, harvests his peanuts, and goes to Martha's house. When George arrives, Martha harvests her cranberries, and they trade peanuts for cranberries at the price they negotiated the night before. However, there are days when George wakes up, and it's not a day when he is so enthusiastic about eating his cranberries. The price of cranberries is too high, so he rolls over in bed and goes back to sleep. Martha makes up, and George has not arrived. Martha knows what has happened. She could call George on the phone and renegotiate the price, but she can't bear to do it, and goes back to bed. The situation is bleak. Both George and Martha express a desire to work, but there is no demand. However, there is a government, which is monitoring the situation. The government agent gets George out of bed, and puts them to work digging holes. In exchange for the hole-digging, George is given some bonds which are claims to tomorrow's peanuts. The government plans to tax George in peanuts on the next day, in order to deliver the payoff to the bondholder. However, George does not see through this. His circumstances are now changed. He goes to Martha's, trades bonds and cranberries for peanuts, and everyone is happy.
Does my Keynesian story or Krugman's RBC story help us understand the recent recession? Krugman's story has the advantage of being simple. RBC is a piece of cake relative to Keynesian economics, if you do each properly. But to argue that the recent recession resulted from a productivity shock is not helpful. Is my Keynesian story helpful? No, I'm afraid it does not cut it either.