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Community Currency Guide
by Bernard Lietaer and Gwendolyn Hallsmith
Local Economics 101
Local governments all over the world are struggling to
promote economic development for two main reasons:
1) so that their residents can have better jobs, and
2) to create a more valuable tax base so they can
improve municipal services offered to the public.
Yet the ways in which they pursue economic development
often inadvertently undermines the long-term economic
security of the community, because they spend a lot of
time and money trying to recruit large, outside companies.
This often leads to locally owned business closures, while
at the same time the profits from the large businesses tend
to flow out of the local economy. or initiate tax sales on properties (sell people’s homesand businesses for back payment of taxes).
The resulting trends are well-known – large, big box
stores are undermining the small downtown shops. Other troubling trends exacerbate the problem. Fewer
Pressures of higher insurance rates, labor costs and people are joining civic and religious organizations - the
regulations, increased shipping costs, and the lack of glue holding communities together. The pervasiveness
economies of scale send more and more small businesses of television and isolating entertainments like video
into the “failed” column every year. When this happens, games and computers are undermining the social
local municipalities are left with a lower revenue base, structures that supported community life in the past.
which in turn drives up the costs of taxes, water and New ideas are needed to reinvigorate the social system
sewer fees, and road maintenance for the local population. and get people back out into the community, connecting
When their low income residents can’t pay, municipal with each other and creating networks of support for
officials have few alternatives except to discontinue everyone.
service (turn off their water, stop collecting their garbage) Local communities need new ways to offer people
employment, and to pay for local services like education,
child care, health care, waste management, fireand
Local Economics 101 ................... 1 police protection, infrastructure, and administration.
What is a Community Currency? 2 They have unmet needs in the community for these
Setting Objectives....................... 4 services, and at the same time there are underutilizedresources available that could fill the gaps. The main
The Leadership Team .................12 barrier to matching the unmet needs with the
Select Currency Mechanisms ....14 underutilized resources is a lack of money.
Establish Circulation System .....26 This workbook will show local leaders how to take the
Case Stories ................................ 29 matter of money into their own hands.
Resources ....................................30 The authors are grateful for the support we have had from Chris
Lindstrom and the E.F. Schumacher Society.
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