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European Commission - Enterprise and Industry

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Economy App

Added by Connor Friesen

Economy App

SIE interviews Economy App: follow the link for the in-depth interview

Imagine …

Imagine we could solve most of unemployment by downloading a working economy as an app to our computers and smartphones. Since economy is all about connecting offers and wants according to constraints, that’s not as outlandish as it sounds. Here’s a typical scenario:

Imagine a group of unemployed youth in a city in crisis-struck Southern Italy. They’re digital natives, well-educated, curious and enthusiastic, but effectively economically excluded.

With some outreach, we gather a sufficiently large group of 30 of them one evening to try the “Economy App” out. Everybody opens an account on the website, and we celebrate the begin of the alternative economy as everybody is literally pressing a big green “Start the Economy” button  [:)]

What Happened Next: Connecting Offers and Wants, but Without Cash and Credit

The software then asks everyone some questions: about what they could offer in a local economy – and that can be anything from home-made cheese to carpooling, no-longer-needed stuff, computer support and any other product and service that can reasonably be provided in a home or small business setting. Offering 20 services and 100 items would be a good average per person, and should not take more than one afternoon.

Then also, the app starts asking the users what they want. What their economic needs are. This is done by users registering their interest in the offers that others entered before.

Now, the magic happens: The software connects people to fulfill each others needs by each others offers. Not by direct barter, which is mostly impossible because of the “double coincidence of wants” problem, but by what we call “network barter”. The second image above contains a simple example, but the software might just as well find deals that contain more than 100 people and items.

The idea is that our software keeps the value of products and services provided and accepted in balance for every person participating in a barter deal: so compensation happens in kind and just in time, and no money ever needs to change hands. This economy is free from limitations of personal liquidity and creditworthiness, and thus can also work for the financially poor. (And to some degree, all economies under austerity measures are financially poor.)

In total, this would provide compensated jobs for everybody involved – it can’t completely replace the formal money-based economy, but should generate enough income as a main or side job to allow again more decent living conditions.

A nice side effect that this app will produce is to make work “social” again: you’re no longer a captive in a cubicle, but your own microenterprise. As such, you will regularly interact with new people, mostly from your local area. Along the way, people will make new friends. And the software supports it by offering people potentially fitting new offers “like a dating site offers new matches”, and by celebrating deals and other business activity as a social experience, like exemplified by DaWanda for craftswork.

If the bottom line is that ordinary people can not only work their way out of widespread economic crisis, without money, but even have fun doing so, that’s more than a simple app could ever dream of …

For more information, see: edgeryders.eu/economy-app