The Wörgl Experiment in Tyrol, Austria: the first parallel currency
In 1932, following the economic theories of the economist Silvio Gesell, the Austrian town of Wörgl introduced a local currency designed to lose 1% of its value each month. This gave holders an incentive to spend it as quickly as possible and therefore increase their consumption; launched in response to the Great Depression, the experiment was intended to discourage the hoarding of money. The currency proved a great success in Wörgl and other Austrian towns planned similar experiments. It was banned by an administrative court at the end of 1933. In 1934, a group of Zurich business owners launched another parallel currency, the wir, in Switzerland, to increase the amount of liquidity in the economy. The wir is still in circulation today.