||Insofar as they are localized sets of transactions based upon local production, exchange and consumption, LETS are local economic geographies. They use a local currency which is not exchangeable with, but which may or may not be closely related in nominal value to, a national currency. Within the USA and Australia such currencies tend to go by the generic term \'green dollars\' but in the UK they take on a name associated with the locality â€” bobbins in Manchester, tales in Canterbury, hops in Tonbridge â€” thereby indicating their local provenance and circulation. There is no paper money or coinage involved in LETS. Money takes the form of cheque books through which purchases are made. The cheques are then forwarded to the LETS treasurer or accountant who adds the debit or credit the accounts of all individual members. These accounts are made public to all members of the LETS.
The local currency facilitates exchange of services and self-produced or self-earned goods across the network of members within the LETS. Thus, although restricted in geographical scale, exchange within a LETS is not limited to barter (the bilateral exchanges of one good for another). Insofar as information about the LETS network â€” its members and the commodities that they wish to trade â€” is kept up-to-date and accurate and is published in the directory of offers and wants provided to all members, the local currency acts as a money network. It offers information not just about the possibility of individual transactions (sale and purchase) but about the extent (diversity, size, geographical range) of those possibilities. In this way, it offers some sense of temporal and spatial continuity, at least insofar as the currency will continue to be a means of engaging in economic activity within a LETS. At the same time, however, the bases of the valuation of transactions may be locally constituted. It is in this sense that LETS cannot be reduced merely to the economic but, like all economic geographies, must be understood as a set of social relations (Lee, 1996).
Thus LETS might equally be categorized as miniature forms of civil society in which questions of evaluation may go beyond those associated with use value or exchange value (see Marxian economics). They might, perhaps, reflect ecologically sustainable values, or enable the foregoing of efficiency and choice, for example, and the acceptance of a lower material standard of living in order to free up time to engage in alternative activities. There is, however, a limit to these alternative values which is set by the inputs necessary to sustain social reproduction. Bowring (1998, p. 106), for example, suggests that:
[M]aintaining the tension between the micro-social activities of local trading systems and the more efficient and productive functioning of the macroeconomic system is â€¦ crucial to the protection of individual liberties and of the space for innovation, imagination, and experimental change.Thus, although LETS offer great scope for the practice of alternative values and so open up a range of political possibilities (see North, 1999), there is an uneasy and hotly contested fault line between them and the formal economy. Those who follow Michael Linton, who founded the first LETS on Vancouver Island, British Columbia in 1983, argue that, in order to act as an alternative to the formal economy, LETS must connect with it so as to diversify their potential offerings and to work in ways responsive to the demands of the formal economy. On the other hand, those who advocate LETS primarily as autonomous social alternatives argue that such integration would destroy the very basis of the attraction of LETS as alternatives.
In any event, although LETS have great potential to offer alternative ways of life incorporating values other than those of the formal economic geography, and so to provide a means of regenerating local economic geographies, reintegrating society and promoting sustainable development, these are possibilities more than capable of subversion by exploitation or by the power of the surrounding formal economic geographies. Thus local firms may gain access to markets, cheap capital and cheap labour, whilst the more affluent and skilled members of a LETS may commit precious little time but acquire large quantities of the time of others. Similarly, LETS will struggle to compete with the efficiency and choice of the formal economic geography and so may be abandoned by the more mobile and lead to a form of currency ghettoization. At the same time, LETS may be seen as a source of taxable income affecting welfare or may themselves become a form of workfare.
There are ways around such difficulties (see, for example Bowring, 1998), not least through the use of currency units of time which prevent exploitation in the strict Marxist sense, may promote a more egalitarian reconfiguration of value, avoid taxation and benefits traps and maximize the use of time. However, not only is it the case that LETS account for only a tiny proportion of the population even in countries, like Australia and New Zealand, for example, where they are well-developed but they represent only a marginal addition to the material welfare of their members. But such a conclusion is to assert the autonomy of the economic. Perhaps the greatest value of LETS is their very demonstration of alternative conceptions and uses of time and space, less as resources than as processes.Â (RL)
References Bowring, F. 1998: LETS: an eco-socialist initiative? New Left Review 232: 91-111.Â Lee, R. 1996: Moral money? LETS and the social construction of local economic geographies in southeast England. Environment and Planning A 28: 1377-94.Â North, P. 1999: Explorations in heterotopia: Local exchange trading schemes (LETS) and the micro-politics of money and livelihood. Environment and Planning D: Society and Space, 17, 69-86.
Suggested Reading Bowring (1998).Â Croall, J. 1997: Lets act locally. Calouste Gulbenkian Foundation: London; Lee (1996).Â North (1999).Â Williams, C.C. 1996: The new barter economy: an appraisal of Local Exchange Trading Systems (LETS). Journal of Public Policy 16: 85-101.