Time-based currency

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In economics, a time-based currency is an alternative currency where the unit of exchange is the person-hour.

Some time-based currencies value everyone’s contributions equally: one hour equals one service credit. In these systems, one person volunteers to work for an hour for another person; thus, they are credited with one hour, which they can redeem for an hour of service from another volunteer. Critics charge that this would lead to fewer doctors or dentists. Other systems, such as Ithaca Hours, let doctors and dentists charge more hours per hour.[citation needed]

Early time-based currency exchanges[edit]

Time-based currency exchanges date back to the early 19th century. The National Equitable Labour Exchange was founded by Robert Owen, a Welsh socialist and labor reformer in London, England, in 1832. It established Birmingham, England, before folding in 1834. It issued "Labour Notes" similar to banknotes, denominated in units of 1, 2, 5, 10, 20, 40, and 80 hours. John Gray, a socialist economist, worked with Owen and later with Ricardian Socialists and postulated a National Chamber of Commerce as a central bank issuing a labour currency.[1]

In 1848, the socialist and first self-designated anarchist Pierre-Joseph Proudhon postulated a system of time chits. In 1875, Karl Marx wrote of "Labor Certificates" (Arbeitszertifikaten) in his Critique of the Gotha Program of a "certificate from society that [the labourer] has furnished such and such an amount of labour", which can be used to draw "from the social stock of means of consumption as much as costs the same amount of labour." .[2] Josiah Warren published a book describing labor notes in 1852 [3]

Edgar S. Cahn coined the term "Time Dollars" in Time Dollars: The New Currency That Enables Americans to Turn Their Hidden Resource-Time-Into Personal Security & Community Renewal, a book co-authored with Jonathan Rowe in 1992.[4] He also went on to trademark the terms "Time Bank" and "Time Credit".[5][6]

Time Dollars[edit]

Time Dollars are a tax-exempt complementary currency[7] used as a means of providing mutual credit in Time Banking. They are typically called "time credits" or "service credits" outside the United States. Time Bank members exchange services for Time Dollars. Each exchange is recorded as a corresponding credit and debit in the accounts of the participants. One hour of time is worth one Time Dollar, regardless of the service provided in one hour or how much skill is required to perform the task during that hour. This "one-for-one" system that relies on an abundant resource is designed to both recognize and encourage reciprocal community service, resist inflation, avoid hoarding, enable trade, and encourage cooperation among participants.[8][9][10][11]

Time Banks[edit]

Time Banks have been established in 34 countries, with at least 300 Time Banks established in 40 US states and 300 throughout the United Kingdom.[12][13] Time Banks also have a significant presence in Japan, South Korea, New Zealand, Taiwan, Senegal, Argentina, Israel, Greece, and Spain.[14][15][16] Time Banks have been used to reduce recidivism rates with diversionary programs for first-time juvenile offenders; facilitate re-entry of for ex-convicts; deliver health care, job training and social services in public housing complexes; facilitate substance abuse recovery; prevent institutionalization of severely disabled children through parental support networks; provide transportation for homebound seniors in rural areas; deliver elder care, community health services and hospice care; and foster women's rights initiatives in Senegal.[17][18][19][20][21][22]

Criticisms[edit]

Some criticisms of Time Banking have focused on the Time Dollar's inadequacies as a form of currency and as a market information mechanism. Frank Fisher of MIT predicted in the 1980s that such a currency "would lead to the kind of distortion of market forces which had crippled Russia's economy."[23] To this day, Time Banks in the U.S. must avoid setting any monetary worth on their Time Dollars, lest it become taxable income to the IRS.

Dr. Gill Seyfang's study of the Gorbals Time Bank—one of the few studies of Time Banking done by the academic community—listed several other non-theoretical problems with Time Banking. The first is the difficulty of communicating to potential members exactly what makes Time Banking different, or "getting people to understand the difference between Time Banking and traditional volunteering."[24] She also notes that there is no guarantee that every person's needs will be provided for by a Time Bank by dint of the fact that the supply of certain skills may be lacking in a community.[25]

One of the most stringent criticisms of Time Banking is its organizational sustainability. While some member-run Time Banks with relatively low overhead costs do exist,[26] others pay a staff to keep the organization running. This can be quite expensive for smaller organizations and without a long-term source of funding, they may fold.[27]

See also[edit]

External links[edit]

References[edit]

  1. ^ National Equitable Labour Exchange article, Trade Union Congress history project of the London Metropolitan University
  2. ^ Tadayuki Tsushima, Understanding “Labor Certificates” on the Basis of the Theory of Value, 1956
  3. ^ Warren, Josiah (1852). Equitable Commerce: A New Development of Principles. New York: Burt Franklin Press. p. 117. 
  4. ^ Cahn, Edgar (1992). Time Dollars: The New Currency That Enables Americans to Turn Their Hidden Resource-Time-Into Personal Security & Community Renewal. Emmaus, Pennsylvania: Rodale Press. ISBN 9780878579853. 
  5. ^ "TIME BANKS Trademark". TrademarkHound. US PatentOffice. 
  6. ^ "TIME CREDITS Trademark". TrademarkHound. US Patent Office. 
  7. ^ Lietaer, Bernard; Dunne, Jacqui (2013). "Chapter5: The Future Has Arrived But Isn't Distributed Evenly...Yet!". Rethinking Money: how new currencies turn scarcity into prosperity. San Francisco, CA: Berrett-Koehler Publishers, Inc. p. 85. ISBN 9781609942960. 
  8. ^ Ryan-Collins, Anna; Stephens, Lucie; Coote (2008). The new wealth of time: how timebanking helps people build better public services. London, UK: New Economics Foundation. pp. 3–4. ISBN 9781904883459 Check |isbn= value (help). 
  9. ^ Ferrara, Peter (March 1, 2013). "Rethinking Money: The Rise Of Hayek's Private Competing Currencies". Forbes Magazine. Retrieved March 17, 2013. 
  10. ^ Lietaer, Bernard; Dunne, Jacqui (2013). Rethinking Money: how new currencies turn scarcity into prosperity. San Francisco, CA: Berrett-Koehler Publishers, Inc. pp. 5, 79–85. ISBN 9781609942960. 
  11. ^ Collom, Ed; Lasker, Judith (2012). Equal Time, Equal Value: Community Currencies and Time Banking in the US. Burlington, VT: Ashgate Publishing Limited. pp. 19–20. ISBN 9781409449041. 
  12. ^ Cahn, Edgar (November 17, 2011). "Time Banking: An Idea Whose Time Has Come?". Yes Magazine. Retrieved 7 April 2013. 
  13. ^ Cahn, Edgar (July 19, 2011). Beyond Bartering: Banking On Community Connections. Interview with Michel Martin. National Public Radio: Tell Me More. Washington, DC. 
  14. ^ Simon, Martin (2010). Your Money or Your Life: Time for Both. Gloucestershire, UK: Freedom Favours. pp. 110–115. ISBN 9780956655608. 
  15. ^ "Minister hails Japan care scheme". BBC News UK. 30 October 2010. Retrieved 7 April 2013. 
  16. ^ Madaleno, Margarida (29 August 2012). "Time-banking offers hope to the dispossessed youth of Europe". New Statesman. Retrieved 7 April 2013. 
  17. ^ Shah, Angana; Samb, Pape (October 2011). Time Banking™ Is More Than Money for Women in Senegal (Report). World Bank, International Finance Corporation. pp. 1-4. https://openknowledge.worldbank.org/bitstream/handle/10986/10431/652800BRI0IFC000Banking0Angana0Shah.pdf?sequence=1. Retrieved 7 April 2013. "foster women's rights initiatives in Senegal."
  18. ^ Building Social and Economic Support Networks with Time Dollars (Report). Baltimore, MD. 2004. pp. 5-10. http://www.aecf.org/KnowledgeCenter/Publications.aspx?pubguid={40FBC27E-707C-4575-BCCB-15C81C680DA6.}
  19. ^ Ryan-Collins, Anna; Stephens, Lucie; Coote (2008). The new wealth of time: how timebanking helps people build better public services. London, UK: New Economics Foundation. pp. 19–51. ISBN 9781904883459 Check |isbn= value (help). 
  20. ^ Phelps Stokes Fund (November 2008). Coming Home: An Asset-Based Approach to Transforming Self & Community (Report). Co-Production at Work. 1. W.K. Kellogg Foundation. "facilitate re-entry of for ex-convicts"
  21. ^ Letcher, Abby S.; Perlow, Kathy M. (December 2009). "Community-Based Participatory Research Shows How a Community Initiative Creates Networks to Improve Well-Being". American Journal of Preventive Medicine 37 (6S1): S292–S299. doi:10.1016/j.amepre.2009.08.008. PMID 19896032. 
  22. ^ Miyashita, Mitsunori et al. (June–July 2008). "The Japan HOspice and Palliative Care Evaluation study (J-HOPE study): study design and characteristics of participating institutions". American Journal of Hospice & Palliative Medicine 25 (3): 223–232. doi:10.1177/1049909108315517. PMID 18573997. 
  23. ^ Cahn, Edgar S. No More Throw Away People. Washington, DC: Essential Books, 2004: 6.
  24. ^ Seyfang. G. (2004) ‘Time Banks: Rewarding community self-help in the inner city?’ Community Development Journal 39 (1): 69
  25. ^ ibid.
  26. ^ name=autogenerated4
  27. ^ Seyfang. G. (2004) ‘Time Banks: Rewarding community self-help in the inner city?’ Community Development Journal 39 (1): 69.