Complementary currency
A complementary currency, or alternative currency, is a medium of exchange that is accepted in much the same way as a regular currency, within a group of people or a geographical area. It is made to complement a national currency. Usually complementary currencies are not legal tender, they cannot be used in exactly the same way as money. Their use is based on all the people of the group agreeing to accept them. According to Jérôme Blanc of Laboratoire d'Économie de la Firme et des Institutions, complementary currencies aim to protect, stimulate or orientate the economy. They may also be used to advance particular social, environmental, or political goals.
There are different kinds of these currencies:
- Local or community currencies are used within a locality, or other form of community.
- Regional currencies are similar to local ones, but they are used in a wider geographical area.
- Sectoral currencies are used within one economic sector, for example education or health care.
One system, called mutual credit has the idea that there's a form of credit, that is given, but that does not need banks. Another system is that of barter.
A Local exchange trading system, or LETS trades points, where one point is usually equivalent to one hour of work. This is an example for a time-based currency.
Purposes
[change | change source]Alternative currencies have been made to address specific issues:
- Several of them increase spending; unlike real money, the currency needs to be spent by a given date, else it becomes worthless.
- Such currecies can be useful in comunities that do not have easy access to money.
The 2006 Annual Report of the Worldwide Database of Complementary Currency Systems presented a survey of 150 complementary currency systems in which 94 respondents said that "all reasons" were selected, among cooperation, micro/small/medium enterprise development, activating the local market, reducing the need for national currency, and community development.[1]
References
[change | change source]- ↑ DeMeulenaere, S. (2007). "2006 Annual Report of the Worldwide Database of Complementary Currency Systems" (PDF). International Journal of Community Currency Research. 11: 23–35. doi:10.15133/j.ijccr.2007.003. ISSN 1325-9547.
Further reading
[change | change source]- Glover, Paul. Hometown Money: how to enrich your community with local currency. Greenplanners, 2013.
- Lietaer, Bernard. The Future of Money. Random House, 2001.
- Raddon, M. Community and money: men and women making change. Montreal: Black Rose Books, 2003.
- Suhr, Dieter (1990). The Neutral Money Network (NeuMoNe): A Critical Analysis of Traditional Money and the Financial Innovation "Neutral Money"
Other websites
[change | change source]- Community Currency Magazine
- International Journal of Community Currency Research
- Online Database of Complementary Currencies Worldwide Archived 2013-01-16 at the Wayback Machine
- Social Trade Organisation
- Secure eXchange Protocols Archived 2020-08-13 at the Wayback Machine
- Trade Point: Internal currency of Barter platform
- Alternative Monetary Systems at the Open Directory Project