Sparked by unemployment, the Informal Economy takes off in Spain

You might have already heard that although Spain is currently in a severe economic crisis, vacation is still sacred for those with jobs. This Monday, when people are started returning to work after vacation, the Wall Street Journal published an interesting article (on page A1) titled "For Spain's Jobless, Time Equals Money." The article gave an overview of how Spaniards are organizing themselves in these turbulent times. The WSJ article (worth reading, including the 100+ comments) features a number of individuals and initiatives that OuiShare Spain (ConsumoColaborativo) has already talked about in the recent past.

  • Eduard Folch, a Web page designer from the region of Catalonia, and some his friends have launched their own alternative currency, the ECO, and have created Eco Alt Congost. "Desperate for money of any kind, a score of businesses and two town governments in the area have agreed to accept the eco, which is exchangeable through checks, electronic payments and even a smartphone app." You can try to spot Eduard inside the pictures from the first OuiShare Drink in Barcelona :)
  • Julio Gisbert is a banker who runs a superb website called Vivir Sin Empleo. His time banks and alternative currencies map is used on the directory of projects page of the blog. The number of time banks has doubled in Spain in the recent years.
  • Daniel Remeseiro, 39, founded and developed No lo Tiro, "a three-year-old site similar to Freecycle that connects people who want to give an item away to those who need it. About 6,000 to 10,000 items a month—everything from automobiles to mother's milk—change hands on the site, whose target audience is unemployed women in their 30s." The same source code was used then to develop SegundaManita focused on the gifting of baby stuff. All these initiatives were featured in an article on the gift economy (french) by Cristóbal Gracia.

"A step backward"

The most controversial part of the article states that

Some economists worry that the rise of such informal systems of economic exchange is pushing more of Spain's economy underground—out of the view of regulators and tax collectors, and effectively sending the country back in time developmentally."It's a step backward not only for a euro country, but also for a developed country,"says José García Montalvo, an economics professor at the University of Pompeu Fabra in Barcelona. "Banks and social currencies, can backfire on the broader economy since the income received from such arrangements often goes undeclared, therefore depriving the government of tax revenue."

Such statements make it evident that a large number of economists cannot imagine anything happening (and being sustainable) that does not comply with the economic "laws" they have agreed upon. According to these "laws", collaborative projects such as Wikipedia, Linux or even OuiShare should have never happened. This is not a new debate, as this quote from the book Small is Beautiful (1973) by E. F. Schumacher shows:

"Everything becomes crystal clear after you have reduced reality to one -one only - of its thousand aspects. You know what to do - whatever produces profits; you know what to avoid - whatever reduces them or makes a loss."

The ownership and the consumption of goods is a means to an end, and collaborative economics aim to attain given ends with minimum means. While explaining this to a broader audience will be very challenging, it is Ouishare's goal to help those attempting to do so. If you are interested in the so called informal economy, check out The Informal Economy Symposium taking place in Barcelona on October 12th.