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Demurrage System

An economic proposal by ((Silvio Gesell)) to make bills lose their value gradually
 Definition
Currencies
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Demurrage system: definition proposal


An economic proposal by Silvio Gesell to make bills lose their value gradually, as we find some Interest Issues. A good historical example is that of Wörgl, Austria, in which it was necessary for bearers to put a stamp of 1% of face value each time a new month started, and the following positive socioeconomic effects were observed:

  • Local economic activities were stimulated as the demurrage encouraged people to spend this money as soon as possible, accelerating trades within the community
  • People started to pay tax much more willingly, some even tried to pay it in advance
  • People started some public works by their own means as they had enough money to realize them.

Discussion


The interest of this kind of currency initially invented by Silvio Gesell is that it doesn't have the weaknesses that "classic" currency has (i.e. national currencies). This is:

  • scarcity
  • thesaurization
  • impossibility to exist on the long term because of the exponential growth of positive interest

On top of that, these positive effects for today's global world are to be examined.


A excellent and short introduction can be seen and downloaded here.

"The Natural Economic Orderexternal link" from Silvio Gesell remains the main pioneer work on this topic.


Related links




Contributors to this page: Jean-Francois Noubel and migjp .
Page last modified on Sunday 08 of February, 2004 [15:35:59 UTC] by Jean-Francois Noubel.

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