Going Local can help bolster the Economy

1_wMOQ9vnTEIfjrOOnw5BrtA (1).jpeg

A number of researchers and organisations are taking a closer look at how money flows, and what they’re finding shows the profound economic impact of keeping money in town — and how the fate of many communities around the nation and the world increasingly depend on it. When you spend your money at local small businesses, your money returns to the local economy and is spent again locally, often another five to seven times. That not only helps keep local businesses in business, it fosters new business and creates more jobs.

Research on spending by local authorities shows that for every £1 spent with a small or medium-sized business 63p stayed in the local economy, compared to 40p with a larger business.

“Going local does not mean walling off the outside world. It means nurturing locally owned businesses which use local resources sustainably, employ local workers at decent wages and serve primarily local consumers. It means becoming more self sufficient and less dependent on imports. Control moves from the boardrooms of distant corporations and back into the community where it belongs.” (Shuman 2000)

One way to really make sure money stays in the community is through creating a local currency. Christian Gelleri, a former Waldorf high school teacher in the Lake Chiem area in Germany, has launched a regional currency, the Chiemgauer, equivalent in value to the Euro. According to Gelleri, the Chiemgauer, accepted at more than 600 businesses in the region and with about $3,000,000 Euros worth in circulation, has three times the velocity of the Euro, circling through the economy an average of 18 times a year as opposed to 6. One reason for the fast turnaround is that the Chiemgauer is designed to encourage spending: there is a 2% demurrage fee for holding onto the bills beyond three months.