What is a gift economy?

Last week I asked Eric, a new volunteer who is working with SOS Seattle and part of the “We Generation” to write a series of posts about aspects of the economy: local economies and local multipliers, food-system, alternative currencies and the gift economy.  Eric is a university student majoring in sustainability and economics.  Yesterday I spent my daylight hours at a CLE (continuing legal education – they make lawyers do this to keep their license) where one of the subjects was union law. In the 1950s, thirty five percent of private sector employees were union members, where today the percent has dwindled to 6.9%.   This give rise, to me, the question of what a gift economy looks like.  I have been pondering this question for a while. The story of potlatches whereby competition is based on how much a community or tribe can give versus the other community or tribe just does not adequately explain a give economy for me. 

The point of unions, as I understand them, is that people join together and give from their own pocketbooks for the better of the whole because they know this will create a positive feedback loop, and if the whole are better off, so will they be. At the same time, the union works with – or against - actors in the money-based economy. I took a course on union law in law school because I wanted to understand the demise of union. I learned that about as many of the cases in union law were between union members suing unions as unions protecting workers. 

I’ve looked a bit at the explanation given by Gifford Pinchot III, as well as the examples in Paradise Built in Hell, but still do not really feel satisfied. In the latter case, how is a gift economy sustainable and how can it be created without crisis? In the former, how does it apply to a large geographic region? 

For me, a gift economy would be based on the premise that we all want to give, where the money-based economy is based on the premise we all want more.  The utility curve would tell the story of giving, rather than getting. Supply and demand would be based on the giving utility curve, just as today it is based on the “greed is good” utility curve, and supply and demand would be “regulated” by the private and public sector based on that supply and demand.  As more people gave, more would receive, increasing their capacity to give, and a positive feedback loop would be created.

Posted by Laura Musikanski, ED of HI