Local Exchange Trading Systems (LETS) as a Response to Economic Crisis: The Case of Greece (Draft)

This paper, after defining the three basic types of Complementary Currency Systems (CCS), presents and supports the view that under certain conditions, they can offer significant relief during financial and banking crisis such as the one currently underway in Greece. The CCSs under review operate in parallel and not against a county’s official money and can lead to increased transactions, production level and employment. It next presents the current environment in which CCS operate in Greece and briefly describe their characteristics. A survey is conducted among CCS’ members using a closed type questionnaire and the results are presented and analysed. The focus of the empirical research is to identify the driving force behind CCS membership, motives, values and profile of the members as well as identify the characteristics of successful CCSs. The results are analysed for the sample as a whole but also between two subgroups, LETS and Time banks. In most questions, the differences in opinions among the two groups are not statistically significant, with the exception of a few questions. Overall, from the pattern of the responses among the two groups, the LETS members emerge as more pragmatic and less ideologically motivated than those of Time Banks. Still, it is evident from survey results that the strongest motive for participation in such schemes, in crisis stricken Greece as well as elsewhere, is not the need for goods and services but the need to participate, offer and feel empowered. Setting this finding aside, we maintain that a favourable and clear tax regime could encourage participation not only of the altruists in the society but also of local businesses and the truly needy and thus contribute to the stabilization and rebuilding of the economy.

This paper was presented at the special session on Alternative Finance and Complementary Currencies, organized by the United Nations Non-Governmental Liaison Service (UN-NGLS) at the UNRISD Conference on Potential and Limits of Social and Solidarity Economy.