Re: Ithaca NY (fwd)

[mosler@xxxxxxxx]

On Thu, 1 Feb 1996, William.Butos@xxxxxxxxxxxxxxxxxxxx wrote:
>
>TO: pk'ers.  Would you kindly take a few minutes to read the message I
>sent out over the Austrian discussion board.  Does anyone on PK board
>know of this?  Thanks.  Bill Butos
>
>---------- Forwarded message ----------
>Date: Thu, 1 Feb 1996 19:36:19 -0500 (EST)
>From: William Butos <butos@xxxxxxxxxxxxxxxxx>
>To: AustrianECON@xxxxxxxxxx
>Cc: AustrianEcon@xxxxxxxxxx
>Subject: Ithaca NY
>
>
>
>Has anyone heard about a newly emerging system of barter (?) or
>quasi-money (?) in Ithaca NY?  A psych colleague told me about some sort
>of exchange system some guy started in Ithaca.  The story, I am told, was
>reported in the print media a few weeks ago (maybe in the NY Times).  The
>story seems to go something like this (what follows is extremely sketchy,
>reflecting a conversation on the fly with a Gibbsonian psychologist):
>
>	individuals are issued a quantity of scrip (?) from the organizer
>in proportion to a specific quantity of labor of a particular kind (say,
>carpentry) that entitles the holder of this note a claim to that quantity
>of labor.  My friend seemed to suggest that these notes were then being
>exchanged for each other at some clearinghouse.
>
>I realize my description is very sketchy.  Does anyone have any specifics
>on this?  At first blush, it looks like a way unemployed can kind of
>solve their Clower-type constraints.
>
>Bill Butos
>
It is an interesting concept, and it does work.
My analysis indicates the driving force is that
people are willing to take a chance when they
sell their labor.  They are, in effect, willing
to accept script for their labor.  If it proves
worthless, they figure they haven't lost much.
In general, individuals will rarely exchange
anything other than their excess labor for script.

When you do get paid in script, someone else is
then in debt, or "short," that script.  Presumably
they will offer their services in an attempt to
get even or ahead.  If they don't pay off their
debts, someone's contributed labor goes unpaid.

It is indicative of the real market price for
labor during times of unemployment.
>
>
Warren B. Mosler
Director of Economic Analysis
III Finance

See "Soft Currency Economics:"

http://inca.gate.net/~mosler/softecon.html