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"Free money" #3
Description
Some experienced LETS participants have observed that many new members are reluctant to go into debt, which is a requirement of the system. To overcome the psychological barrier, they suggest giving every newcomer some amount so they can start trading without dipping below the scary "0".
I'm not sure how to implement this; perhaps it's as simple as adding a fixed amount when printing a user-visible sum, in essense making that amount equivalent to "0". Or the system could add functionality for topping up every account and modify a database constraint.
Activity
lastorset commentedon Apr 26, 2011
I'm going for a system where a special lender account automatically transfers a given amount to every regular user. This looks like it will gel well with how the system works otherwise.
Adding a fixed amount to user-visible sums is a bit hairy, since it's hard to cover every situation and easy to mess up other calculations. It's also a bit too "magical" if we have to change amounts and users suddenly find their balances adjusted without a transaction. The other solution, topping up accounts and modifying database constraints (or actually the "Balanced" method, as it turns out) messes with the otherwise-simple logic of Local Exchange, and would make a future merge with the upstream UK version harder.
lastorset commentedon May 15, 2011
After more thought and discussion we decided to cancel this particular implementation and rather go for an approach where new members are given a "bonus" for adding at least three wanted/offered entreis. This is easier to implement and solves an additional problem: not just the psychological barrier to going into debt, but also the tendency of users to offer many services but request quite few.
The work already done has been stored in the branch "free-money". It includes a nested transaction framework that may be useful in other contexts; this framework has been placed in the branch "nested-tx".
robf commentedon Apr 7, 2012
All LETS groups I've known since 1993 use zero balance, and try to encourage people to "pass through zero" often - i.e. trade frequently in both directions.
To encourage this, and try to address reluctance to go into debit, on Falmouth LETS in the early days we ran a competition with a prize for the person with the biggest turnover of Palms (Falmouth local currency) over 3 months but with a twist to favour those using others' services (aka going into debit!), and trading with the most members.
Formula for this for each member was:
Total Palms received plus (Total Palms spent, multiplied by 2) multiplied by number of different members traded with
The winner was someone whose skills were in quite high demand, but also keen to use others' services.
Other options for those reluctant to go into debt is to pay them to do work helping run the LETS (paid from LETS admin account) or encourage them to participate in work parties, which encourages the inherently social nature of LETS - see http://falmouthlets.org.uk specifically http://falmouthlets.org.uk/pages.php?id=17
lastorset commentedon Apr 8, 2012
Thanks for the advice! I have forwarded it to our project leader. (We already do pay those that help run the LETS.)
Have you written about the competition online elsewhere? It would probably be interesting for more people.
For the record, we will not change the zero-balance constraint. Any potential technical solution would merely support solutions that reward certain behavior.