It is a system of allocating resources through direct bartering, entitlement by law, or sharing out according to traditional custom.
In the more complex forms of natural economy, some goods may act as a referent for fair bartering, but generally currency plays only a small role in allocating resources.
As such, natural economies tend to be self-contained, where all the goods consumed are produced domestically.
[1] Rosa Luxemburg believed that the destruction of the natural economy was a necessary condition for the development of capitalism.
[2] Karl Marx described the Inca Empire as a natural economy because it was both isolated and based around exchange rather than profit.