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Economic Circles

Economic circles are crucial to a healthy regional economy. The more we can keep money circulating locally, the richer we are. Why? Because we can use that money over and over — in effect turning each dollar into millions.

In a typical economic circle, you buy something from a local store or pay for local services. That business then pays its local suppliers and its local employees. Those employees in turn become consumers like you — they buy something from a local store, etc. When at any point in this circle we lose the "local" and pay someone or some company outside our region, that money is gone. It has leaked out of our community and we are that much poorer.

The Common Good system gives us an easy way to track our economic circles and opportunities for improvement.

This chart shows four types of transactions. For strong economic circles, we should see the volume of person-to-business (p2b) transactions matching the volume of business-to-person (b2p) transactions. More p2b than b2p means business are not paying enough local employees (or other local businesses). More b2p than p2b means people are shopping elsewhere. As you see (in red), several member businesses have begun paying their employees in Common Good credit (see our FaceBook post on how we solved the payroll challenge).

The Monthly Bank Transfers chart also measures how well we are doing as a community, at keeping money in the system.

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