This article is from the Puzzles FAQ, by Chris Cole email@example.com and Matthew Daly firstname.lastname@example.org with numerous contributions by others.
At one time, the Canadian and US dollars were discounted by 10 cents on
each side of the border (i.e., a Canadian dollar was worth 90 US cents
in the US, and a US dollar was worth 90 Canadian cents in Canada). A
man walks into a bar on the US side of the border, orders 10 US cents
worth of beer, pays with a US dollar and receives a Canadian dollar in
change. He then walks across the border to Canada, orders 10 Canadian
cents worth of beer, pays with a Canadian dollar and receives a US
dollar in change. He continues this throughout the day, and ends up
dead drunk with the original dollar in his pocket.
Who pays for the drinks?
The man paid for all the drinks. But, you say, he ended up with the
same amount of money that he started with! However, as he transported
Canadian dollars into Canada and US dollars into the US, he performed
"economic work" by moving the currency to a location where it was in
greater demand (and thus valued higher). The earnings from this work
were spent on the drinks.
Note that he can only continue to do this until the Canadian bar runs
out of US dollars, or the US bar runs out of Canadian dollars, i.e.,
until he runs out of "work" to do.