Articles

Local Currency an Emerging Trend?

In economics/money on April 8, 2009 by Editor Z


Berkshares, the local currency of the Berkshire region of Western Massachusetts.

Recently a friend of mine who resides and works in Northampton, MA was talking to me about “complementary currencies” or “local currencies”, where a local area produces and uses its own alternative currency in local area businesses, as opposed to the dominate currency (in our case in the United States that would be the almighty dollar). Now I am not one who is totally unfamiliar with even the slightest scintilla of monetary policy, but nevertheless sounded to me like an interesting idea to help band communities together in this time of global economic hardship.

Today in USA Today, there appeared an article that states so-called complementary currency or local currency is something that was used after the first and second Worlds using what was called scrip. There are a handful of communities and counties throughout the country that have local currency, such as the Berkshares here in Western Massachusetts which was established in 2006.

A small but growing number of cash-strapped communities are printing their own money.

Borrowing from a Depression-era idea, they are aiming to help consumers make ends meet and support struggling local businesses.

The systems generally work like this: Businesses and individuals form a network to print currency. Shoppers buy it at a discount — say, 95 cents for $1 value — and spend the full value at stores that accept the currency.

Hey, why not? Keep the dollar as the national overall currency, while allowing those in local areas to opt into whether or not they want to use the dollar or a local currency in exchanges involving businesses, goods, and services? It instills pride and a sense of solidarity in a community, while cushioning when the dollars strength begins to abate.
(H/T: Flickr)

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