Locanomics and XtownX

For many years I have been concerned about the state of the economic system – as it exists in the large and in the small.

In 2007 I made contact with Peter Morrison, at the time the Local Economic Development manager at the Okhahlamba Municipality in KwaZulu-Natal in South Africa. From our initial contact I structured the XtownX model of information-based economic systems, and applied this to many communities throughout the country.

Over the years Peter and I met many times and started to explore a theory, which I named as Locanomics, being a combination the words “local” and “economics” and which is designed to address the specific needs of these smaller communities, below that which is addressed by local economic development (LED) initiatives, but above the level of SMME businesses. Some have called this “community economic development” with the focus on small geographical communities, but this term has not reached the mainstream. Locanomics is focused heavily on the role of high-quality information in guiding local economic activity, and is positioned as distinct from other local economic theories and practices.

My philosophy is that economics needs to be bottom-up/needs-driven, and not top-down/policy-driven, and that only way to bring billions out of poverty is to enable them to become self-sustaining economically, and to protect their own community economics as the unit of economic production. But this must be done at the level of critical mass, which is the community rather than at the individual business less.

My concern is thus focused on the poverty trap of small regions, which includes small towns and rural villages. With the advent and the growth of globalisation throughout the world, it has become cheaper to produce items in China and ship them to a village in South Africa than for the local residents to produce these items themselves. I argue that this economic model destroys local economies, and also destroys the environment, since all shipping incurs a significant cost on the climate. Whereas I do not envision a future with no international trade, I rather look to maximise the economic potential of the community to be self-sustaining as far as is possible.

We need to return back to the self-contained villages of 100 years ago – in which there is a butcher, a baker, and a candlestick-maker…well, you know what I mean. If there is someone in the village who is not working, then they should contribute to the economy by doing something which can benefit the local economy, by doing something which the community needs, or which the visitors needs, so that the community can help to lighten the purse of their tourists. There are two core challenges which we address – firstly informing the village community that a new set of products and services are now available – and secondly by encouraging the purchasing of local goods and services over non-local goods and services. Just these two alone make a significant difference.

Whereas this is simple to say, to put this together is a far greater challenge, and for this purpose I have developed a theory of local economics, which I call Locanomics, and this had been merged with Peter’s practical grounding in helping communities build themselves up. On this basis we decided, in early 2015, to write a book on Locanomics and we are busy with this at present.

Sadly, Peter passed on 8 November 2015, before our theory and practice has been finalised and before our book has been completed and published. I will be continuing the legacy of his practical experience to complete the book, since this is something worth saying, and we had always hoped that a large number of people, for whom there are few opportunities, could benefit from these practices. Peter will be missed and my continued work on Locanomics is a tribute to his life and work. Thanks Peter, may you rest in peace.