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EXCHANGE NETWORKS & PARALLEL CURRENCIES ON THE MAP OF GREECE: GEOGRAPHICAL PATTERNS AND SCHEMES’ ACTIVITY Irene Sotiropoulou

EXCHANGE NETWORKS & PARALLEL CURRENCIES ON THE MAP OF GREECE: GEOGRAPHICAL PATTERNS AND SCHEMES’ ACTIVITY Irene Sotiropoulou

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Published by Mark Malone
Non-monetary activity or activity involving currency which is not official in any country is
usually considered to be outside the scope of economic research, even if this activity is not performed for charity or among family and friends. However, if by economy we mean “sharing/distributing within the oikos”, then official currency cannot be the main criterion of the definition. Thus, this paper has been prepared within the framework of a larger research project titled “Exchange Networks and Parallel Currencies: Theoretical approaches and the case of
Greece”, which studies economic activity without the use of any official currency. This is the first time that parallel currencies and exchange networks, as well as free bazaars, are studied in Greece, not only because of lack of interest by academia, but mostly because such initiatives emerged the
very last years in the country and still emerge and develop, especially since 2009 onwards.
Non-monetary activity or activity involving currency which is not official in any country is
usually considered to be outside the scope of economic research, even if this activity is not performed for charity or among family and friends. However, if by economy we mean “sharing/distributing within the oikos”, then official currency cannot be the main criterion of the definition. Thus, this paper has been prepared within the framework of a larger research project titled “Exchange Networks and Parallel Currencies: Theoretical approaches and the case of
Greece”, which studies economic activity without the use of any official currency. This is the first time that parallel currencies and exchange networks, as well as free bazaars, are studied in Greece, not only because of lack of interest by academia, but mostly because such initiatives emerged the
very last years in the country and still emerge and develop, especially since 2009 onwards.

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Published by: Mark Malone on Nov 28, 2013
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1
st 
 International Conference in Political Economy –
Rethymno, 10-12
th
 September 2010 Exchange networks & parallel currencies: Theoretical issues or research in Wonderland (July 2010)
1
Irene Sotiropoulou, PhD Student (Department of Economics, University of Crete) E-mail: isotiropoulou@econ.soc.uoc.gr Supervisor: Professor George Stathakis (Department of Economics, University of Crete) E-mail: stathakis@econ.soc.uoc.gr EXCHANGE NETWORKS & PARALLEL CURRENCIES: THEORETICAL ISSUES or RESEARCH IN WONDERLAND ABSTRACT
This working paper belongs to a greater ongoing field research project concerning economic activity in Greece that is performed without the use of any official currency. The scope of the paper is twofold: a) To present the theoretical issues that the project aims to deal with, while studying exchange networks, parallel currencies and free bazaars in Greece. Particularly, the variety of the schemes and initiatives studied touches essential points of economics, like the notions of value, money, exchange, market, etc. And b) To present the findings of the first stage of field research in connection with the theoretical arguments that might have an explanatory ability concerning the initiatives studied.
Keywords:
exchange networks, parallel currencies, free bazaars, value, money, market, exchange, grassroots theory.
I. INTRODUCTION
Non-monetary activity or activity involving currency which is not official in any country is usually considered to be outside the scope of economic research, even if this activity is not performed for charity or among family and friends. However, if by economy we mean “sharing/distributing within the oikos”, then official currency cannot be the main criterion of the definition. Thus, this paper has been prepared within the framework of a larger research project titled “Exchange Networks and Parallel Currencies: Theoretical approaches and the case of Greece”, which studies economic activity without the use of any official currency. This is the first time that parallel currencies and exchange networks, as well as free bazaars, are studied in Greece, not only because of lack of interest by academia, but mostly because such initiatives emerged the very last years in the country and still emerge and develop, especially since 2009 onwards.
II. FIRST ATTEMPT FOR A TYPOLOGY AND DESCRIPTION OF THE INITIATIVES STUDIED
A first attempt has been made to create a typology, which is used for analytical purposes only and not as a fair description of reality. The main criterion for this is the object of each initiative – by “object”, we mean the transaction aimed by the scheme participants. Therefore, this paper distinguishes those various grassroots initiatives in a) parallel currencies, b) exchange/barter networks and c) free bazaars and free networks. To those categories, a sui generis scheme can be added, named “Money Back System”, also described below.
 
1
st 
 International Conference in Political Economy –
Rethymno, 10-12
th
 September 2010 Exchange networks & parallel currencies: Theoretical issues or research in Wonderland (July 2010)
2
II. A. Parallel currencies
By “parallel currencies” we mean any currency used by people in transactions, without this being official in any country. A parallel currency might have only a virtual or digital appearance (f.ex. units credited in a computer database) or it might take a physical appearance in notes, issued by the currency users. In Greece, all parallel currencies are digital or virtual and no-one has acquired any material appearance so far. There follows a brief description of the parallel currencies that exist nowadays in Greece.
II.A.1.
 
The Athens Time Bank
The oldest parallel currency scheme in Greece is a Time Bank based in Athens and run by the Greek branch of the European Network of Women
1
. The scheme started working in October 2006 and follows the general structure of time banks: it is a network of individuals who are offering services to each other. In reward, each member gains “time” so that he/she is able to ask for the other members’ services. The value of the services is accounted in time hours and the hours credited and debited for each member are recorded in a computer with software created by a volunteer. The time hours expire six months after they have been gained by a member. The expiry date has been set by the organisers so that the time currency will circulate efficiently within the scheme, instead of being accumulated by some members only. If one does not want to spend his/her time hours gained, one can donate the time currency to somebody else or even to an NGO, even if that other person or organisation is not a member of the scheme. The major emphasis has been given so far to education services, related to languages, PC skills, arts, etc but also to domestic work. At this point (July 2010) the Time Bank is being resuming its function, despite the financial problems the parent NGO is facing and despite the fact that the Time Bank database needs personnel for its central management. They also organise workshops, where people from Athens and other Greek cities participate, in order to learn more about Time Banking.
II.A.2. The Ovolos currency
The Ovolos project started organising in January 2009 and it is based in Patras city (South-West coast of Greece) but also run in Thessaloniki (in the North of Greece)
2
. The effective launch of Ovolos currency was done finally in late March 2010 and despite the expanding membership (already more than 4800 in July 2010, although only a part of them are actually exchanging), its organisers consider the project to be still in testing-phase. Moreover, Ovolos is used by several people who do not live or work in Patras and Thessaloniki, but they prefer to transact with parallel currency. This has created a peculiar situation, where locality of transactions is not linked necessarily to the “base cities”. The Ovolos organisers see this as an advantage, which will make Ovolos an online technology platform available to all people living in the country, enabling them to experiment using parallel currency while transacting locally no matter where they live. The main idea of the scheme is that the members can use the Ovolos currency (which is virtual, e.g. on the main computer system and on each member’s digital smart card) instead of euro
1
 www.enow.gr. The Greek Branch of the European Network of Women is a Non-Governmental Organisation assisting women who have been violence victims. However, the Time Bank is an activity totally separated from the rest NGO activities and anyone can be a Time Bank member.
2
 See the website www.ovolos.gr. There is also a group with the same name at Facebook, where the members discuss issues about their currency. All texts are so far in Greek only.
 
1
st 
 International Conference in Political Economy –
Rethymno, 10-12
th
 September 2010 Exchange networks & parallel currencies: Theoretical issues or research in Wonderland (July 2010)
3 currency for their transactions with scheme members. To avoid abuses, the scheme has not permitted double pricing, e.g. the items or services sold are priced and paid in Ovolos only. Each member has an equal say on the management of the scheme. To achieve this equality in practical terms, there has been created a non-profit organisation (
Σωµατείο
) based in Patras city and named “Ovolos Research and Documentation Center for Social Currency” which supervises the entire initiative. A small part, e.g. 1% of the transaction value is retained by the scheme to cover its administration costs, with the intention that this will create an excess of Ovolos currency under the management of the Organisation. This amount will also cover sums for charities and sums for balancing possible losses of the system from micro-credit loans to members. The other important feature of Ovolos is that the scheme members use extensively the social networking internet applications to communicate, exchange ideas, discuss and notify each other about current news or gatherings, etc. The use of Facebook as well as the use of blogs, email lists, etc is also found in other, non-monetary initiatives. However, the use of those same applications for Ovolos currency has been an essential element of the scheme, long before the scheme itself was launched, and it still is a main feature of the initiative.
II.A.3.The Local Alternative Unit of Volos city
The Local Alternative Unit (
Τοπική
 
Εναλλακτική
 
Μονάδα
 –
ΤΕΜ
) was formally planned to be launched on June 15
th
 2010 in the city of Volos, on the East Central coast of Greece. The Unit is digital only and will be used within the framework of the Exchange and Solidarity Network 
1
 which covers the entire county of Magnesía. At the moment, the membership is rather low because they have not proceeded with heavy publicising yet, given that the scheme is on the process of resolving several practical issues. The project is a very interesting one, not only because it is designed to remain local, but also because the managing team has opted so far to avoid the network taking any official legal form. However, they name their project as a “mainstream” one and an observer could say that this is true, given that the network tries to be as inclusive as it can be. They are also in close coordination with local municipal services, so that the network can have several trading points hosted in the city’s Social Centres, where people with no access to internet or uncomfortable with using PCs can ask for support in order to register and trade within the network. Local businesses are also welcome to participate and actually it is a local business that offers the server of the network. On the other hand, the funding of the project is upon its members only. The rules adopted for the Local Alternative Unit use are rather strict: they give an amount of 100 LAU by registration, but debt for any member cannot get over 100 LAU either. Of course, the issue they are currently discussing is the total money volume trap, e.g. the money volume will be limited to 100LAU per person in average and the question they are currently facing is how the scheme can inject more currency into the system without imposing any “duty” or “tax” on transactions and without  jeopardising the entire project by inflation or lack of trust in the system.
II.B. Exchange networks
By the term “exchange networks” we mean structures that facilitate non-monetary exchange for their members and they are either of general nature or specialised in one sector of activity. To this type of activity, there belong groups of exchange that have not assumed any network or any other “form” of structure.
1
 www.tem-magnisia.gr 

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