Complex Systems Modeling of Community Inclusion Currencies

This paper proposes a complex dynamic systems subpopulation model for the construction and validation of a novel form of local complementary currency, namely the Grassroots Economics Foundation’s Community Inclusion Currency (CIC) implemented recently in Kenya. Differently from other related work in computer science or of a legal nature, we frame our analysis in a deeper economic context, thus bridging the gap across these parallel literatures. First, we highlight the potential usefulness of the emerging blockchain-technology backed CICs, now popular in the new – and interdisciplinary – field of cryptoeconomics. Essentially, CICs can act as a local liquidity-provision institutional device in poor or isolated economic regions to increase their internal exchange and economic value added, thereby serving as a market-based mechanism to alleviate poverty, in addition to government aid and akin in its automatism and credibility to a currency board monetary regime in national economies. The ultimate goal of these CIC systems is to promote a transition toward complete inclusion and integration into the national and global economies, pulling over the communities and regions out of self-sufficiency and poverty into more advanced stages of economic development and well-being. Second, we elicit 50 heterogeneous utility types according to observed transactions behavior and build a corresponding model and simulation at a meso-economic level, which for many purposes could prove more insightful for policymakers than the usual extreme perspectives of micro and macro.