Local currencies, starring David Bowie

I like to shop in local businesses when I can. Their owners tend to stay involved in the local community and I like the idea of keeping economic activity close to home. But it’s not just where I spend my money, but also how. Using cash, for example, helps the margins of my local mom-and-pops.

Some enterprising communities have turned to local currencies as an additional way to accelerate the impact of local shopping. Think of Disney Dollars, but for communities not corporations. “Such schemes,” as the Economist writes, “aim to boost spending at local retailers and suppliers, by encouraging the recirculation of money within a community. Because the currency is worthless outside its defined geographic area, holders spend it in the neighborhood, thus creating a ‘local multiplier effect’.”  It’s an interesting idea.

While there are a few local currencies in the United States, I haven’t really seen one in the wild. Apparently, there’s one in the Berkshires, for example; Wikipedia lists a number of others.

Today, I’m in London so I made a visit to Brixton to use the Brixton pound. I had a great conversation at the Brixton Pound Cafe about the experiment and its challenges, particularly in an urban environment. They pointed out there’s an even an ATM machine of sorts, nearby.

But the challenges are greater than they know. I changed money at the Cafe and was going to document my purchase of a pint of beer or two, JSG Boggs style, documented with a receipt and change. Unfortunately I visited two pubs listed on the Brixton Pound app – and neither would accept the Brixton Pound!

Looks like I’m stuck with the notes. The notes are actually quite well designed; the £10 pound note is of David Bowie so I wasn’t going to spend it anyway. I suppose that’s an additional £10 that’ll go to the Brixton community. And they appear to have eBay value in the US, so not all is lost. But I fear the Economist is right in its pessimism.

{ 2 comments… add one }
  • mrhe February 18, 2017, 10:11 pm

    Fascinating real world experiment. I remember reading that Economist article a while back; the idea seems like a decent one on the surface but there are clearly some problems, as you have illustrated. Makes for a cool souvenir at least. Perhaps those Brixton notes will spike in value post-Brexit…?

    • One Civic Act February 19, 2017, 2:44 am

      Well, they are technically pegged to GBP, so they should move in tandem. We’d need to create a scarcity of GBP to drive demand for B£. Or perhaps find a market where B£ is already scarce like the US.

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