Convertible Local Currencies For The Economic Development Of Sustainable Communities, Findings From An Analysis Of Nine French Local Currencies

Abstract

Alternative currencies have become a growing phenomenon in grassroots social innovation. Convertible local currencies are one of the main forms they take in France. Despite the abundance of theoretical literature on this subject, empirical evaluations remain scarce due to limited data availability. To address this gap, we conducted an econometric evaluation of the impact of using CLCs on firms’ turnover. This evaluation employs a two-way fixed-effects model using data from the Fare file, a dataset containing tax information for all French firms from 2009 to 2019. Additionally, we selected a control group through propensity score matching in the Fare file. Our analysis reveals a 10% in turnover for small and medium-sized firms using one of the nine CLCs included in this study. Consequently, we conclude that CLCs support the economic development of a localized community of actors who are chosen for their commitment to ethical and sustainable production practices.