Chapter 7 Why Complementary Currencies Are Necessary to Financial Stability: The Scientific Evidence

By Bernard Lietaer

Conventional economists tend to regard complementary currencies as an anomaly, to be dismissed as an irrelevant or romantic distraction. Regulators tolerate them, as long as they remain marginal. If any were ever to grow to a relevant size, they believe such monetary innovations should be suppressed lest they disturb monetary policy or reduce the efficiency of the price formation process.[1]

But this belief is incorrect: A recent scientific breakthrough provides evidence that a monopoly of one single type of currency is a systemic cause for the prevailing monetary and financial instability. In fact, it will be shown that, far from being a disturbance, a variety of monetary media is necessary for economic and financial stability in a society. This conclusion stems from a structural flaw in our modern monetary system, a flaw that has played an unacknowledged role in every crash since the Dutch tulip bubble burst in 1637, including the one we are experiencing now!

The proof for this claim comes from fundamental laws that govern all complex flow systems, including natural ecosystems, economic and financial systems. Recent theoretical breakthroughs now make it possible to measure quantitatively, with a single metric, the sustainability of any complex flow system, based on the emergent properties of its structural diversity and interconnectivity. Furthermore, we can now see that whenever diversity in a complex flow network is being sacrificed because of too much emphasis on efficiency, systemic collapses are a totally predictable consequence.

For generations, we have been living worldwide with a monoculture of the same type of media of exchange – a single national currency monopoly in each country, created everywhere through bank-issued debt. Neither Marxist nor various capitalist schools of economic thought find this troubling. The main difference in this respect between communism of the Marxist-Leninist variety on the one side, and capitalism on the other, is that in the former, governments always own the banks. While in the latter, governments own the banks only after they have gone bankrupt. Indeed, in capitalism, private investors are normally supposed to be in control.

But the functioning of the money system itself is the same in both instances: both rely on a single national currency created through bank debt. The structural solution to economic and financial instability in both cases is also clear, even if it appears shockingly unorthodox: we need to diversify the types of currencies available in a society and the types of agents that are creating them, specifically through complementary currencies.

 The Sustainability of Complex Flow Systems

We now can demonstrate that a structural fault is involved in generating financial crashes. Quantitative ecological research has provided empirical substantiation of this mechanism and a deeper understanding of its dynamics. A fully documented, step-by-step mathematical proof of the claims made below can be found in a seminal paper by Ulanowicz, Goerner, Lietaer and Gomez, whose most relevant points are summarized here.[2]

Information is any “difference that makes the difference,” Gregory Bateson famously declared, and, as the binary logic of the digital age has popularized, such difference almost always involves the absence of something. Information theory (IT), in studying the working of whole systems, is a means for apprehending and quantifying what is missing from representations. The key point is that if one is to address the issue of sustainability, then the inchoate, undetermined “potentiality” of a system must also become the focus of inquiry, because it is the source of the resilience that allows the entire system to persist.[3]

What IT tells us is that a system’s capacity to undergo change has two components: an order component, called “mutual constraint,” quantifies all that is regular, orderly, coherent and efficient. It encompasses basically all the concerns of conventional science. This first component is an analogue of Newton’s Third Law of Motion, or of the Chinese Yang construct.

By contrast, the second component represents the lack of those same attributes, or the irregular, disorderly, incoherent and inefficient potential behaviors that have escaped the scrutiny of science. They are ignored or discounted mainly because they cannot easily be described, are less readily repeated or measured, or all of the above. This component corresponds to the Chinese Yin.

In the jargon of IT, this second, usually overlooked component of system change is called “conditional entropy”; it can also be thought of as uncommitted potential. The very absence of order (even if its potential is never activated and therefore goes unnoticed and unmeasured) plays the key role in a system’s long-term stability. This uncommitted potential enables a system to adapt to a changing environment and survive unexpected challenges.

If we are to understand sustainability, we must recognize that the absence of order is even more significant than the first variable, order. A living system adapts in homeostatic fashion to buffer variability in performance by expending what Odum called “reserves.”[4] The reserve in this case is not some palpable storage such as a cache of some material resource. Rather, it is the capacity to show flexibility and adaptability to new circumstances – and it usually requires some loss of efficient performance.[5] Systems that endure – that is, are sustainable – are able to achieve a dynamic balance between these two poles of order and disorder, efficient performance and adaptive resilience.

Let us now define more precisely our terminology:

Efficiency is defined as the capacity of a complex flow system to process a given volume of whatever flows through it, per unit of time – e.g., grams of biomass per square meter per year for a natural ecosystem; GDP per capita in an economy; or billions of dollars per day in an electronic payment system.

Resilience is the capacity of a complex flow network to survive an attack, a disease, or adapt to a change in its environment.

A crucial finding from the study of complex flow systems is that efficiency is definitely not a sufficient metric for achieving sustainability. Metrics such as GDP or return on investment to capital are not sufficient to assess economic sustainability because they cannot distinguish between healthy sustainable growth and short-term bubbles doomed to collapse. For a complex flow system to be sustainable, it must possesses enough resilience, which can be understood as an undefined and contingent responsiveness to the unpredictable challenges thrown up by a system’s own workings and its environment.

 A Chinese Insight

“When Yang and Yin combine appropriately, all things achieve harmony,” according to Lao Tse in Tao Te King #42. This dialectic between efficiency and resilience is the “go and get” and the “let go and give” of life. In the Chinese philosophical tradition, yang and yin characteristics are assigned to all natural systems. In Asia the concepts of Yin-Yang are seen as necessary complements to each other. Their history goes back thousands years, to Siberian shamanism and to the Yi Jing (the Book of Changes), attributed to King Wen of Zhou (1099-1050 BC). The explicit Weltanschauung of Chinese philosophy is precisely the need for all aspects of nature and life to strike an appropriate balance between Yang and Yin energies.

For the first time in history, to our knowledge, Western science is now able to prove in a quantitative way the validity and depth of this Taoist discovery. So let us give credit to this ancient Eastern insight that has been so widely ignored in the West, to the point we don’t even have words to express this idea.

C.G. Jung was one of the first to express regret that our Western culture is not more familiar with the concept of Yang and Yin: “Unfortunately, our Western mind, lacking all culture in this respect, has never yet devised a concept, nor even a name, for the ‘union of opposites through the middle path’, that most fundamental item of inward experience, which could respectably be set against the Chinese concept of Tao.” If our use of this Yin-Yang vocabulary risks appearing exotic, it is simply because we don’t have any equivalent words in any of our Western languages.

Oriental philosophers have developed an infinite number of ways to describe the Yin-Yang relationship and polarity. The following figure offers those selected as most relevant for our purpose. The following figure identifies attributes most relevant to our inquiry here.

Yin-Yang Characteristics

Fig. 1: Some Yin-Yang Coherences and Polarities

Fig. 1: Some Yin-Yang Coherences and Polarities


This figure can be read vertically, emphasizing the internal coherences. Or it can be read horizontally, emphasizing the polarity between them. One advantage in using the Yin-Yang vocabulary is that Taoists never separate such polarities. They emphasize the connection between them – their complementarity – because, in truth, both are indispensable!

The Yin and Yang ways of looking at reality are not competing ways of relating to and interpreting reality any more than your right eye “competes” with your left one. Instead, because of their differences, they together provide you with a range and depth of vision, something which neither one can do by itself.

For the past millennia, all patriarchal societies have tended to confer more legitimacy on the male half of human perception. We have thereby projected a hierarchical duality on concepts such as activity/passivity, creativity/receptivity, culture/nature, mind/senses, spirit/matter, invariably claiming the former to be somehow “better” or more “accurate” than the latter. What matters here is not to deny the qualities inherent in the masculine viewpoint, but to elevate the feminine to an equal level. A shift in consciousness towards giving equal emphasis to both views is not just a matter of fairness; it may be the key to developing the kind of integrated, synergistic vision needed for the sustainability of our species.

“The feminine and the masculine are not objects, not things, not simply biological bodies we are attempting to unite,” writes Molly Dwyer, “but rather complex, archetypal organizations of consciousness…What is needed is a recognition of the synergy between these polar opposites. Synergy is evident everywhere in nature, and is an important source of causation in the ongoing evolutionary process. Since the relationship between male and female is fundamentally synergistic, it is essential that we rethink and recreate our cultural and symbolic understanding of the feminine and its relationship to the masculine to increase the possibility that the human species will co-create an evolutionary change that is advantageous to the entire biosphere. If we do not, we are in danger of bringing about our own extinction…”[6]

Not surprisingly, in all patriarchal societies a Yang bias is accepted as “normal.” In contrast, the poet John Keats coined the term “negative capability” for the often overlooked Yin trait of human personality and experience: the capacity to hold uncertainty without angst – the capacity to live with the unknown as an ally rather than something to be eliminated. It is more like a connection to an undifferentiated ground that resists form, which continually invokes questions and reflection and is potentially multidimensional, a space of “both-and” and neti-neti, the Hindu concept literally meaning “neither this, nor that.”

In summary, natural ecosystems exist because they have both sufficient self-directed identity and flexibility to change. The polarities necessitate each other in an appropriate balance of harmonious complementarity. Over time, nature must have solved many of the structural problems in ecosystems. Otherwise, these ecosystems simply wouldn’t exist today. They are our best living examples of large-scale and long-term sustainability in action.

 Empirical Ecological Evidence

A key insight from empirical studies of natural systems is that nature does not select for maximum efficiency, but for a balance between the two opposing poles of efficiency and resilience. Because both are indispensable for long-term sustainability and health, the healthiest flow systems are those that are closest to an optimal balance between these two opposing pulls. Conversely, an excess of either attribute leads to systemic instability. Too much efficiency (excess Yang) leads to brittleness and too much resilience (excess Yin) leads to stagnation. The former is caused by too little diversity and connectivity, and the latter by too much diversity and connectivity. This dynamic is illustrated in Fig. 2.

arc graph


Fig. 2: The effects of diversity and connectivity in achieving efficiency and resilience.


Sustainability of a complex flow system can therefore be defined as the optimal balance between efficiency and resilience in its network. With these distinctions we are now able to define and precisely quantify a complex system’s sustainability in a single metric.

In human designed systems, there may be a tendency to over-emphasize efficiency and growth of volume at the expense of resilience – that is, to emphasize efficiency more than resilience. Resilience theory suggests that autocatalytic forces can jeopardize the sustainability of the whole network. In an economy, for example, the larger economic actors may use lobbying to obtain laws and rules that favor their growth at the expense of the smaller ones. In the financial domain, banks may become “too big to fail” and thereby obtain implicit government guarantees that they will be bailed out in case of trouble.

In such cases, sustainability is dramatically reduced because interconnectivity collapses. In the monetary domain, similarly, as long as we remain stuck with the idea of a single national currency, the system is structurally configured to reduce diversity. Such a system will predictably collapse, and if it is forcibly restored to “normal,” it will collapse again and again. When a bias favoring efficiency is pushed still further, the collapse of interconnectivity and sustainability grows worse, hastening the speed of a system’s collapse.

Interestingly, there is an asymmetry in natural systems versus economic systems. In natural ecosystems optimality requires greater resilience than efficiency! In natural ecosystems the weight on efficiency has empirically been determined from a regression analysis using actual data from a wide variety of ecosystems of different scales that the optimal point lies closer to resilience than efficiency.

Moving beyond information theory, ecologists have measured the transfer of biomass and energy (“trophic exchanges”) within ecosystems. They have also found ways to derive values for an ecosystem’s throughput efficiency and resilience by estimating network size and network connectedness in terms of two structural variables: diversity and interconnectivity. It turns out that there is a specific zone of optimal robustness into which all observed natural ecosystems fall. This zone has been named the “Window of Viability” (in ecological literature the “Window of Vitality”), as illustrated in Fig. 3.

arc 2


Fig. 3: The Window of Viability


 Application to Other Complex Flow Systems

A reasonable question arises: Do the lessons we learn from ecosystems truly apply to other complex flow systems, such as economic or financial systems? It appears to be so. It is critical to understand that the findings described in natural ecosystems arise from the very structure of a complex flow system, and therefore that they remain valid for any complex flow network with a similar structure, regardless of what is being processed in the system. It can be biomass in an ecosystem, information in a biological system, electrons in an electrical power network, or money in an economic system. This is precisely one of the strong points of using a web-like network approach instead of machine-like metaphor.

The fields of engineering, business and economics each focus almost exclusively on efficiency, which means that we have rich opportunities to empirically test whether the proposed metrics for complex flow systems would indeed improve sustainability.

For example, electrical power grids had been systematically optimized for decades towards ever-greater technical and economic efficiency. It has come as a surprise to many engineers that, as they have approached higher efficiencies, suddenly large-scale blackouts have been breaking out with a vengeance “out of nowhere.” A few decades ago several blackouts hit large areas of the United States and northern Germany. The data should be available to model these systems as flow networks, because that is what they literally are. One could then quantify their efficiency and resilience, and plot their Window of Viability. The solution on how to rebalance the power grid system to make it less brittle, and to determine its optimal sustainability, would be an obvious “hard science” test application of the concepts and metrics described here.

The point being made here is truly profound and has wide-reaching implications for all complex systems, natural or human-made. Placing too much emphasis on efficiency tends to automatically maximize flows, size and consolidation at the expense of choice, connectivity and resilience until the entire system becomes unstable and collapses. And yet conventional engineering, economics and finance invariably assume that more efficiency is always better!

Until these findings about resilience and the Window of Viability, the only means for identifying the relative success of a system, whether in nature or in economics, have been measures of total throughput and efficiency. For example, in ecosystems, as in economies, size is generally measured as the total volume of system throughput/activity. Gross Domestic Product (GDP) measures the size of economies in this fashion and Total System Throughput (TST) does the same for ecosystems. Many economists urge endless growth in size (GDP) because they assume that growth in size is a “good enough” proxy metric for a system’s health.

GDP and TST, however, are both poor measures of sustainable viability because they ignore network structure. They cannot, for example, distinguish between a healthily thriving resilient economy and a bubble that is doomed to burst. Or between healthy “development,” as Herman Daly describes it,[7] and explosive growth in monetary exchanges driven by runaway speculation. Now, however, we can distinguish whether a particular increase in throughput and efficiency is a sign of healthy growth or just a relatively short-term bubble that is doomed to collapse.

 Application to Financial and Monetary Systems

Applying the above complex flow framework specifically to financial and monetary systems, we can predict that an excessive focus on efficiency will tend to create exactly the kind of bubble economy that we have been able to observe repeatedly in every boom and bust cycle in history, including the biggest bust of them all, the one triggered in 2007-8 whose fallout we are still dealing with today.

If we view economies as flow systems, the primary function of money as a medium of exchange can be seen as critical. Money is to the real economy as biomass is to an ecosystem – an essential vehicle for catalyzing processes, allocating resources, and generally allowing the exchange system to work as a synergetic whole. The connection to structure is immediately apparent. In economies, as in ecosystems and living organisms, the health of the whole depends heavily on the structure by which the catalyzing medium – in this case, money – circulates among businesses and individuals. Money must continue to circulate in sufficiency to all corners of the whole because poor circulation will strangle either the supply side or the demand side of the economy, or both.

Our global monetary system is itself obviously a flow network structure, in which monopolistic national currencies flow within each country (or group of countries in the case of the Euro), and interconnect on a global level. The technical justification for enforcing a monopoly of a single currency within each country is to optimize the efficiency of price formation and exchanges in national markets. Strict regulations in every country maintain these monopolies. Banking institutional regulations further ensure that banks tend to be carbon copies of each other both in terms of their structure and behavior. The consequences of relying on a worldwide monoculture of big banks were demonstrated with the cataclysmic, simultaneous crash of 2008.

In a seminal 1953 paper, Milton Friedman proposed letting markets determine the value of each national currency as a way to further improve the overall efficiency of the global monetary system.[8] This idea was actually implemented by President Nixon in 1971 to avoid a run on the dollar at that time. Since then, an extraordinarily efficient and sophisticated global communications infrastructure has been built to link and trade these national currencies. According to the Bank of International Settlements, the trading volume in the foreign exchange markets reached an impressive $5.3 trillion per day in 2013, to which trillions of currency derivatives should be added. Over 95 percent of that trading volume is speculative, and less than 5 percent is in fact used for actual international trade of goods and services.

Speculation can play a positive role in any market: theory and practice show that it can improve market efficiency by increasing liquidity and depth in the market.(“Liquidity” and “depth” in finncial markets refer to the possibility of moving large volumes of money without significanty affecting prices. In a deep market, a lot of people are buying and selling. By contrast, in a thin market, because fewer people are trading, even one single large transaction could significanty affect prices.) But current speculative levels are clearly out of balance. Although over half a century old, John Maynard Keynes’ opinion has never been as appropriate as it is today: “Speculators may do no harm as bubbles on a steady stream of enterprise. But the position is serious when enterprise becomes the bubble on a whirlpool of speculation. When the capital development of a country becomes a byproduct of the activities of a casino, the job is likely to be ill-done.”[9]

 Nobody questions the efficiency of these huge markets; but their lack of resilience has been vividly demonstrated by the Asian crisis of the late 1990s and dozens of other monetary crashes. Our global network of monopolistic national moneys has evolved into an overly efficient and therefore dangerously brittle system. The system’s lack of resilience shows up not in the technical field of the computer networks (which all have backups), but in the financial realm. Such a crisis, particularly a combined monetary and banking crash, is – apart from war – the worst thing that can happen to a country.

Even more ironically, whenever a banking crisis unfolds, governments invariably step in to help the larger banks to absorb the smaller ones, believing that the efficiency of the system is thereby further increased. This makes banks that are “too big to fail” into still bigger ones, until they become “too big to bail.”

As noted earlier, the substance that circulates in our global economic network – money – is maintained as a monopoly of a single type of currency: bank-debt money, created with interest. Imagine a planetary ecosystem where only one single type of plant or animal is tolerated and artificially maintained, and where any manifestation of successful diversity is eradicated as an inappropriate “competitor” because it would reduce the efficiency of the whole. It would clearly be unsustainable.

An overly efficient system is “an accident waiting to happen,” destined to suffer a sudden crash and collapse however many competent people dedicate time and heroic efforts to try to manage it. After a collapse, in both natural ecosystems and in monetary systems, however, the lessons of resilient systems are not learned. Political and market authorities seek to restore the preexisting structures and the same process resumes again. We have seen this after the complete meltdowns of the financial systems in Germany in the 1920s and again at the end of World War II; in the United States during the “bank holidays” of the Great Depression; in Russia in the 1990s; and in Argentina in 1999-2002. All were simultaneous monetary and banking crises. In our time, a dollar or a Euro crisis could trigger a similar phenomenon.

Fortunately, most crises are less extreme than that. However, going through the exercise of exploring such a “pure” extreme gives some ideas of the power and depth of the dynamics involved. Less extreme crises manifest only some of the features of the process we have described. Just like a partial forest fire, one that doesn’t reduce everything to ashes, these scenarios manifest only some of the attributes of a total burnout.

The process of a collapse shows up graphically with a drop of sustainability to close to 0 percent, as shown in Fig. 4. The next step after a total meltdown is an extreme fragmentation, without much collaboration. In a forest, this takes the form of seedlings of any type trying to sprout randomly. At the extreme, in a financial system, this takes the form of a return to primitive barter – i.e., survival exchanges without any standardization or organization. This stage can be seen as the case when each participant uses whatever he or she has as a commodity currency.

The next step is the emergence of a multitude of “survival organizations” that start to introduce some standards and some informal agreements on dates and places where the exchanges may take place. In Argentina this took the form of the multiplication of local exchange mechanisms, under the names of ruedes de trueque in which locally issued creditos currencies were used as medium of exchange in weekly neighborhood markets. Assuming that the designs of these systems were sound (which unfortunately wasn’t the case in Argentina), then the better systems would tend to emerge as models for others, and gradually more efficient exchange systems would evolve. Over time, a more diversified and more interconnected economy would rebuild, which would return the system back into the zone of the Window of Viability. This whole process is illustrated in Fig. 4.

arc 3

Fig. 4: The Aftermath of a Total Meltdown in a Natural Ecosystem. After extreme fragmentation the species that are best adapted to the new environment slowly make the flow system climb back toward the Window of Viability.

In modern monetary practice, this scenario does not occur, however. What has invariably happened is that – thanks to orthodox monetary policies and bank lobbying – a monopoly of bank debt money
is reestablished as the only legitimate medium of exchange. This took place for instance in Germany in the 1920s and in the US in the 1930s, when all the “emergency currencies” were outlawed; or in Argentina through a massive falsification of creditos paper currencies (see Fig. 5).

arc 4

Fig. 5: No Window of Viability in a Monetary Monoculture. After a monetary or financial collapse, however, a monetary monoculture is reestablished as soon as possible, with the result that the return to a Window of Viability is not allowed to emerge. This guarantees that we continue repeatedly to go through this loop.

We now know that such a monoculture is not a sustainable structure in the long run. Attempts to return to “normalcy” will in fact overshoot the window of sustainability again. The system will resume the next cycle of boom and bust by pushing for greater efficiency within a monoculture environment, which seeds the next crash later.

We have been going through this loop many times by now. According to International Monetary Fund (IMF) data, since the 1970s there have been no less than 145 banking crises, 208 monetary crashes and 72 sovereign debt crises: a staggering total of 425 systemic crises, an average of more than ten countries per year![10] These crises have hit more than three-quarters of the 180 countries that are members of the IMF, many of them several times.

How many more crises do we need before humanity is willing to learn that this is a systemic issue, and that only structural changes will avoid repeating the same patterns? (A full inventory of the options on how to deal with a systemic banking crisis has been explained in another paper, by Lietaer, Ulanowicz & Goerner.[11])

 A Structural Monetary Solution

Conventional economic thinking assumes the de facto monopolies of national currencies are an entirely natural phenomena. But the clear lesson from nature is that systemic monetary sustainability requires a diversity of currency systems, so that multiple and more diverse agents and channels of monetary links and exchanges can emerge.

It is important to realize that there are other ways to get back towards the Window of Viability; a total crash can be avoided. Solutions lie in letting complementary currency systems grow, or even encourage the soundest of them to blossom, and gradually and gently push back the excesses of the monoculture.

Conventional economists are correct when they claim that a diversity of media of exchange is less efficient than a monopoly. However, it has now been proven that complementary currencies facilitate transactions that otherwise wouldn’t occur, linking otherwise unused resources to unmet needs, and encouraging diversity and interconnections that otherwise wouldn’t exist. While this may result in a drop in efficiency, it is the necessary cost for increasing the resilience of the economic system.

At the other extreme, some complementary currency enthusiasts claim that we should encourage very large numbers of complementary currency systems, to the extent of letting everyone issue his or her own currency. At a certain point, of course, this scenario risks overshooting the Window of Viability in the other direction, producing stagnation.

It is very encouraging that at least one Central Bank has officially concluded that social currencies are not a threat to monetary policy, but actually contribute to the building of social capital and to the reduction of poverty.[12] Furthermore, we now also have empirical proof from 75 years of data from the WIR system in Switzerland that business-to-business complementary currencies tend to be countercyclical with the business cycle of conventional money: they actually help Central Banks in their task of stabilizing the national economy in terms of employment and in smoothing the swings in the business cycle.[13] In a period when unemployment, poverty and economic exclusion are all increasing in the developed world, it would be important that Central Banks revisit this issue with a more open mind than has been the case so far.

 Policy Implications

Ironically, our financial system has become so fragile because it has become too efficient.

To achieve high efficiency, our modern monetary system has become too streamlined via a monoculture of a single type of money – a monoculture legally imposed in the name of market efficiency. Furthermore, governments enforce this monopoly by requiring that all taxes be paid exclusively in this particular type of currency.

We argue that making the monetary system sustainable will require a new balance between efficiency and resilience in economics, in a way similar to what occurs naturally in ecosystems. Humanity has become, involuntarily and reluctantly, the steward of this planet’s biosphere. Ultimately, we have no choice but to learn how to make our global civilization sustainable, or it will cease to exist. It may be useful to remember here that Albert Einstein defined insanity as doing the same thing over and over again and expecting different results.

 Next Steps?

What then should governments do to implement the approach proposed here? It could start by accepting other types of currencies, besides conventional bank-debt national money, for the payment of fees and taxes. For instance, the province of Vorarlberg, Austria, or the city of Bristol, in the UK, are now accepting specific complementary currencies in addition to conventional national money in payment of local taxes.

The trillion-dollar question facing us today is: How many more banking and monetary crashes do we have to live through before we have the humility to learn from complex natural systems? Could it be that governments may have to learn from the next crisis that they can’t afford to save the banking system?

Bernard Lietaer has studied and worked in the field of money and payment systems for more than 30 years in an unusually broad range of capacities including Central Banker, fund manager, university professor, and a consultant to governments in numerous countries, multinational corporations, and community organizations. He co-designed and implemented the ECU, the convergence mechanism to the single European currency system (the Euro); and served as president of the Electronic Payment System while at the Belgian Central Bank. He is Research Fellow at the Center for Sustainable Resources at the University of California at Berkeley, and Professor in the Erasmus Mundus program at the Sorbonne in Paris. Information about his work is available on

[1] Rösl, Gerhard, “Regional Currencies in Germany: Local Competition for the Euro?” Discussion Paper, Series 1: Economic Studies, No. 43/2006 (Deutsche Bundesbank Eurosystem, 2006). Available for download at

[2] Ulanowicz, Robert E., A Third Window: Natural Life Beyond Newton and Darwin. (West Conshohocken, PA: Templeton Foundation Press, 2009).

[3] Conrad, Michael, Adaptability: The Significance of Variability from Molecule to Ecosystem. (New York, Plenum Press, 1983).

[4] Odum, Eugene. P., Fundamentals of Ecology (Philadelphia: Saunders, 1953).

[5] Ulanowicz, Robert. E., Sally J. Goerner, Bernard Lietaer and Rocio Gomez, “Quantifying sustainability: Resilience, Efficiency and the Return of Information Theory,” Ecological Complexity 6(1) (2009), pp. 27-36.

[6] Molly Dwyer, “Complexity and the Emergent Feminine: A Cosmological Inquiry into the Role of the Feminine in the Evolution of the Universe” (Winning Paper of the 1999 Vickers Award International Society for the Systems Sciences, Asimolar, California).

[7] Daly, Herman. E., Beyond Growth: The Economics of Sustainable Development. (Boston, Beacon, 1997).

[8] Friedman, Milton, “The Case for Flexible Exchange Rates,” in Essays in Positive Economics (Chicago: University of Chicago Press, 1953), pp. 157-203.

[9] Keynes, John Maynard, The General Theory of Employment, Interest and Money (London: Macmillan, 1936), p. 159.

[10] Caprio, Gerard Jr, and Daniela Klingebiel, “Bank Insolvencies: Cross Country Experience,” Policy Research Working Papers No. 1620 (Washington, DC, World Bank, Policy and Research Department, 1996); and Laevan, Luc and Fabian Valencia, “Resolution of Banking Crises: The Good, the Bad, and the Ugly,” IMF Working Paper 10/146 (Washington: International Monetary Fund, 2010).

[11] Lietaer, Bernard, Robert E. Ulanowicz, and Sally J. Goerner, “Options for Managing a Systemic Bank Crisis,” Sapiens, 2(1) (2009). Available online at

[12] Freire Vasconcellos, Marusa, “Social Economy and Central Banks: Legal and Regulatory Issues on Social Currencies (social money) as a Public Policy Consistent with Monetary Policy,” International Journal of Community Currency Research, (Vol. 13, 2009), pp.76 – 94.

[13] Stodder, James, “Corporate Barter and Economic Stabilization,” International Journal of Community Currency Research, 2 (1998); Stodder, James, “Reciprocal Exchange Networks: Implications for Macroeconomic Stability,” Conference Proceedings, International Electronic and Electrical Engineering (IEEE), Engineering Management Society (EMS) (Albuquerque , New Mexico, 2000). Available for download at An updated version (2005) is available at; and Stodder, James, “Complementary Credit Networks and Macroeconomic Stability: Switzerland’s Wirtschaftsring,” Journal of Economic Behavior and Organization, 72, 79–95 (2009). Available for download at

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