Transactions are often executed concurrently. Isolation ensures that concurrent execution of transactions leaves the database in the same state that would have been obtained if the transactions were executed sequentially. There are four layers: read uncommitted, read committed, repeatable reads and serializable. In PostgreSQL the default one is READ COMMITED, meaning that when a transaction runs on this isolation level, a SELECT query sees only data committed before the query began and never sees either uncommitted data or changes committed during query execution by concurrent transactions.
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