Thursday, March 13, 2008

Local Currency

Today I learned that some places, in the United States and elsewhere, use local currency to foster local economic development. One such system has been used quite successfully in the Berkshires. of Western Massachusetts.

The idea is that people buy local currency from a special bank and use it at participating local businesses. It gives these businesses a way to compete with national chains and keeps capital local.

Obviously this wouldn't work where I currently live, Montgomery County Maryland, because it's far too urban. Keeping money around to foster economic development couldn't be less of a problem. People would see no reason to use the local currency.

However, such a scheme could be interesting on Cape Cod, where I grew up. We don't have a problem getting an influx of capital, due to a booming tourist trade. The problem is that nearly all of the economic activity is centered on tourists, leaving locals feeling like there's nothing left for us. With a local currency, certain local businesses could specialize in serving local people and keep tourists away. Most local businesses thrive on tourist dollars, but certain coffee shops and bars would like to keep their local flavor.

Would it work? Probably.

Am I being unfair to tourists by favoring their exclusion? Definitely.

Would most locals welcome my proposal? Given that we take pleasure in making tourists think that there is a tunnel under the Cape Cod Canal and a bridge to Martha's Vineyard, I'd say undoubtedly.

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