GoodGeist
A podcast on sustainability, hosted by Damla Özlüer and Steve Connor, brought to you by the DNS Network. Looking at sustainability issues, communications, and featuring global guests from a wide variety of sectors such as business, NGOs and government.
GoodGeist
The Good Money, with Makoto Nishibe
What if money could finally measure what we truly care about—care, safety, culture, and thriving ecosystems—not just cash in the bank? We sit down with evolutionary economist Makoto Nishibe, head of the Good Money Lab, to explore how economies and the money that powers them can evolve together.
Starting with Japan’s “lost decades,” Makoto explains why top-down policies and a single-number view of value failed regional communities, and how plural, adaptive thinking opened the door to community currencies and digital experiments that restore trust and resilience.
We unpack the idea of “good money” as a medium designed to serve the good life, not speculation. From QR payments and crypto to Japan’s 200+ digital community currencies, Makoto shows how technology lowers barriers for cities, banks, and citizens to co-create units that reward what matters: local exchange, volunteering, and ecological care.
If you’ve ever felt that GDP and net worth don’t capture real prosperity, this conversation offers a practical, hopeful path forward—powered by digital tools, civic design, and a richer moral compass.
Listen in!
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Good guy to a podcast series on sustainability hosted by Damla Eusler and Steve Connor. Brought to you by the DNS Network.
SPEAKER_02:Hello, hello everyone. You are listening to Good Guys, the message on sustainability, which is brought to you by the DNS Network, the global network of agencies dedicated to making the world a better place. This is Damla from MIDIAgency Istanbul and This is Steve from Creative Concern in Manchester.
SPEAKER_03:This podcast series explores global sustainability issues, how they're communicated, and what creativity can do to make positive change happen.
SPEAKER_02:So in this episode, we're going to talk to Makoto El Nishived, the head director of Good Money Lab. Makoto is an evolutionary economist, and his current resurgence interests are theory and policy of evolutionary economics and evolution of institutions, in particular, evolution of money.
SPEAKER_03:And Damler is founder member of the fan club, I think, Makoto. So you're currently working on the fusion of community currency and cryptocurrency as a digital community concurrency. You're also a professor at the School of Economics in Censo University, and you've also been president, I think, of the Japan Association for Evolutionary Economics. So, Makoto, thank you so much for taking the time to talk to Damler and myself.
SPEAKER_00:Thank you. I'm very happy to be here.
SPEAKER_02:First of all, we love to find out how people got where they are, Makoto. So tell us about your journey to become involved in changing the economic system.
SPEAKER_00:Okay, my quest to find our new socioeconomic system began around 30 years ago when I started teaching economics at Hokkaido University in 1993. At the beginning of the 1990s, the Japanese uh bubble economy passed and prices of stock and real estate flashed. All banks were plagued by the bad rounds. In an attempt to stimulate the economy, the Japanese government implemented large-scale financial policy and the central bank's monetary policy several times. However, the economy didn't recover and people began to have the serious doubt about the conventional monetary and financial systems. In 1997, the four Japanese main banks and security companies were bankrupt for the first time since World War II. The first of the four failed financial institutions was the Hokkaido, Takushoku Bank, the largest bank in the northern parts of Japan. Because the bankruptcy, the Hokkaido economy was completely plagued by a serious depression. So we called it a lost decade, lost two decades, or sometimes lost three decades. At that time, people in Hokkaido often said the Hokkaido catches cold fast in Japan, but it is the last to recover. Thus, I have found out that the impact of the bubble bust on the regional and local economy was more severe and profound than in metropolitan areas such as Tokyo and Osaka. I had become strongly critical, not only conventional monetary and fiscal policy and conventional economics, but also of the conventional monetary and financial systems themselves. Accordingly, I began searching for an alternative monetary financial system and realized that since the 1980s, many citizens and groups around the world had attempted to establish and operate the community currency to stimulate local economy and communities. Since the late 1990s, a boom in the movement of a local or community currency has occurred in Japan's public and private sectors, and I have been involved in this movement, engaging with the community currency in both theory and practice. The boom faded, but another has come again right now due to the digital transformation of advanced uh fintech, including QR code settlement and the distributed ledger uh technology or blockchain or cryptocurrencies such as Bitcoin and Ethereum. This is uh the course uh where you know I came to the community currencies, uh, Bitcoin, and so on.
SPEAKER_03:So now I understand why DAMLA wanted you on the podcast, Makoto, because I'll share a secret. It doesn't matter which topic we talk about, Makoto. It could be biodiversity, climate, renewable energy in the global south. Somehow, DAMLA always challenges mainstream economic thinking in every podcast. So now I understand. So before we go deep into the heart of next economies and all of that, let's start unraveling the jargon a little. And you place the history of economic theories and thoughts across three major perspectives classical, one, two, neoclassical, and three, historical institutional schools of economic thinking. So evolutionary economics is seen as the combination of one and three. Can you explain or elaborate on this for our listeners?
SPEAKER_00:Yes. Okay, I try to explain it. Uh yeah, I major in evolutionary economics, but I started from uh Lazar Klasker or Marxian economics. So I shifted from my positions. So that's why you know uh I'm now evolutionary economist, but uh I understand every other, you know, economic schools. But uh, evolutionary economics takes uh theoretical pluralism as a methodological uh perspective on economics. So a review of a history of economics shows that there has always been multiple schools of thought coexisting and competing with each other. For example, the classical, neoclassical, and historical institution, schools, as you said, the three major talents of economics in the past have presented, systemized a theory based on the vision formed in the light of the major economic problem and real situation of the time, as well as the country or region covered by each theory of schools, and therefore they are considered to have some degree of validity in terms of isolating certain aspects of complex reality. The world economy is very complex, but when we focused on some aspect, for example, in England or in Japan or in Turkey, so it's gonna be different kind of uh you know uh sort or uh theory. Uh so since the 1970, based on the neoclassical economics, the globalization has progressed with uh expansion of uh EPA's Economic Partnership Association or FTA free trade agreement to promote the free trade zone worldwide and implement monetary integration. For example, is the EU law in Europe, driven by the belief that uh deregulation and liberalization of the market is necessary for economic efficiency. However, in recent years, due to the factors like wars, the spread of uh COVID-19, the trade friction and immigration issues, the United States has uh you know uh pivoted towards protectionism uh exemplified by the policy like uh America First, uh high tariff and immigration restriction. So, in economic terms, this signals a decline in neoclassical economics and the resurgence resurgence of uh historical institutional approaches that respect the history and institutions. Thus, the rather than the positive uh single correct doctrine or the truth theory like the national science, the economics must be understood as evolving alongside economic current with the composition of its three major school of thought undergoing uh transformations. For evolutionary economics posit that not only do economics institutions and policy change, but economics that theoretically underpin them also evolve. So economics and the economy co-evolve. Evolutionary economics consider the classical schools, or which define the economy through the leap production, to be more realistic than the neoclassical schools, which defined it through the scarcity. Uh, it also emphasized the historical institutional schools' view that the economy is more not merely based on the rationality of economic agent, but it's uh established only through a set of laws, that is, institutions, that changes over time. Therefore, abruptly economics uh critique neoclassical economics and argue that the economics should be understood at the synthesis of uh classical economics and the historical institutional economics.
SPEAKER_02:So it's all about the flaw, Steve.
SPEAKER_03:I know.
SPEAKER_00:No, I think I just I was almost I I think I understand is it right okay.
SPEAKER_02:Let's talk about good money. You say that good money drives out the bad. What is good money and how can you make a difference with it in today's world?
SPEAKER_00:Okay, uh, let me first explain what is a good money lab is, where I now I am the representative. So when I retired Hokkaido University in 2017 and transferred to Sensu University, located in Kawasaki, uh next to Tokyo, establishing an R and B hub in central Japan would be highly viable for promoting digital community currencies. Therefore, in 2018, we established the Sensu University Digital Community Currency Consortium Laboratory. The name is very long. So a general incorporate association for the industry, academia, government, uh collaboration, and uh you know, comprised of uh corporate and general members and the employee uh employing the researchers. Uh, since the official name is you know the Lang 3, so we decided to use the common name Good Money Love in 2019. We organized uh uh FIFA binary uh LAMIX uh international congress in Japan, uh, whose name Theme is Going Digital, uh New Possibility of Digital Community Currency System. It was awarded uh Gento uh Best International Compass Convention Award 2020. So let's get back to the what is you know good money. Yes, this is a simple question, but uh a little bit difficult to explain. But let me try. Say if the Turkish lila good money, how do you answer? Well, I don't know.
SPEAKER_02:I think it depends on how we use it.
SPEAKER_00:Okay. So uh I suppose many would say it's bad money. This is because the Turkish lila is rapidly uh depreciating against other currencies, uh, leading to the hyperinflation, where domestic prices are skylocating. Since people's incomes aren't rising as fast as inflation, their real income is falling and their standard of living is steadily worsening, the people should no longer have any trust in the government or the central bank or their own national currencies. The Austrian economist Hayek argued that as long as the state or central bank monopolize the issuance and the management of the money even under a floating exchange rate system, Gresham's law, where the bad money drives us good, will operate, fueling inflation and national fiscal deficit. Therefore, uh he contended that the current fiat currency is bad money and undesirable. He believed that uh eliminating the state monopoly on money and allowing private uh currency of different denominations and qualities to complete, to compete, would lead people to selectively use uh currency as they deem desirable, resulting in good money driving and bad. The while this view was uh dismissed as absurd fantasies by you know the most economists, the current situation is approaching the competitive currency environment, Hayek described. I mean, uh we we have now very much diversity of uh you know community currencies and uh cryptocurrencies and you know digital currencies and with QR code settlement and so on. So Hayek believes that uh uh for the people uh to trust and use money with uh confidence, the stability of its value is essential. If the value of money affords and the inflation becomes severe, trading uh partners may refuse to accept it, fearing it will depreciate further. Uh conversary, uh, if people anticipate deflation and rising monetary value, they hold on to their money because it becomes more valuable and they are reluctant to spend it. If monetary value is unstable, money ceases to be used for buying and selling goods and consumption stagnates. So instead, then money which should enrich our lives gets hoard becoming capital solely for the purpose of the gaining larger capital gains. So in this era of diversifying diversifying currencies, money is no longer something uh predetermined and imposed top-down from the nation and so on. So instead, it is newly created from below and chosen by people. Therefore, in the creation and selection of money, the question of what constitutes good money becomes crucial. It is not merely about uh convenience, efficiency, or stability. What exactly is good money? This is the most uh fundamental question. The answer is not something someone else will give us, we must discover it ourselves. So, what kind of life do we want to live? What kind of economy do we consider good? What kind of society do we want to live in? Uh, from now on, we must question not only quantity like uh domestic, gross domestic products, GDP, wealth, or population growth, but also the quality of our lives and the quality of our society and economy. So, what exactly do we want to make sustainable? The accumulation of money, economic growth, population growth, technological progress, or a rich national environment, ecosystems teeming with diverse life, the wars and cultures passed down through generations, and community sustained by people gathering and connecting. So, good money is a medium that uh effectively reflects the value the people hold dear, and one that depends on the good life as seen from the perspective of quality of life and existence, and that determines quality rather than quality. So, as a consodium-based laboratory, evolving industry, academia, government, and the public, our good money lab aims to explore, discover, and realize newly emerging digital community currency and other uh good money from the manipul angles.
SPEAKER_03:Uh thank you. Makoto, could we move from there? By the way, I definitely choose the good money scenario you painted at the end there. That's that's the future we want, isn't it? A good life, a good planet, good communities, and money at the service of that. So let's go then from that starting point into the future. And the title of your presentation at the first international prosumer conference was the new age of the monetary institutional ecosystem and complementary currencies, diversity, and quality of life in the environment. And you you emphasized there the importance of modern legal currencies and the digital translation transformation that we're expecting. And you started this podcast talking about blockchain and QR codes and the importance of digital in all of this. So, what does this future look like to you and and what kind of change will it bring about?
SPEAKER_00:Okay, uh as I already explained, uh we are getting into the age of diversification of monies. We have many kinds of money already, which are almost uh digital. Cryptocurrencies are all digital, they have nothing, you know, they have nothing, no material, papers, and so on. And up until now, we in Japan we already have more than 200 uh digital community currencies. Most of them are initiated by the uh local uh financial institution and uh local you know government and so on. So now we are getting into very diversified you know the monies age. So I think uh we we need to have the ability to select which uh money should be good or better for your life, and otherwise we only uh talk about how to gain money, how to uh be a leach, and so on. But I don't think that kind of conversation is not so rich, I mean, uh in our for for our you know uh quality of life. So, yes, we need to have diversity in terms of money, but also we need to have uh you know a consciousness and a good value uh for the better better society.
SPEAKER_02:So I will ask about another thing because there are a lot of terms that we are not really familiar with. So a few weeks ago, you were in Istanbul in the next economy summit, and the good money lab was a part of the vector money conversation. And as I understand, please correct me if I'm wrong, but this is a pivotal point for your theory of change for our listeners and for us, of course.
SPEAKER_03:I know, I was gonna say for our listeners, for us, please.
SPEAKER_02:For us, can you explain us what vector money is and how this concept plays a role in the next economies?
SPEAKER_00:Yeah, the term bacteria is a mathematical term, you know. Uh you you might study in in your high schools and in your mathematical uh classroom. Uh so the vector has at least uh two components, X and Y, and so on. Okay, so let me uh explain what is a Bectu money. So why we need uh such kind of uh you know complex money and so on. Okay, so we know money is more important than water sometimes, right? Uh water, we we definitely need water every day, but uh we also definitely need money, and we cannot survive a single day without it. So we also believe that money is defined as uh something, one thing, just like waters. But uh it is determined by the national law and that it can be exchanged for other countries' money at the exchange rate that fluctuates constantly in the market. So most people believe there is no money other than the legal tender uh determined by the uh national uh law or central bank law and so on. And rightly sinks that they cannot choose good money for themselves. Uh so since the Turkish Rila, uh euro, and yen uh can all be converted into dollars, so we find meaning in the uh comparing all countries' GDP on a dollar basis. So believing uh nations with a larger per capita GDP are wealthier. So, you know, the European country are richer, but Asian country or the Latin American or the African country are less richer, and so on. In this case, it arbitrarily means that each country's currency is reduced to a single currency, the dollars, the world reserve currency based on uh exchange rate at a given point in time. And this dollar is used to measure the value of all things and events. So of course, the well conversion could be done to euro or yen instead of dollars, but regardless, everything is measured by converting to a single currency. The higher income or higher asset means uh moving further to the light on the number line. The lower income or the asset means being the closer to zero, the suffering loss or uh incurring debt moved one in the negative directions. The thus the modern money is measured on the number line as a positive, negative, or zero. For example, the ten thousand dollars is ten times of hundred dollars and so on. So, but everything expressed, sold, evaluated, and purchased using this one-dimensional money. I think you know this is uh major uh source of evil. Such transactions constantly occur in buying, selling, and investing. This is one-dimensional money, so-called uh scada, uh scale money. SCADA money, one-dimensional money. Now, whether someone is rich or poor is determined solely by the side of one-dimensional quality. Income and asset disparity are measured only by the magnitude and quality. So I think you know, once we we have only one money, so we talk about rich poor and so on. So we want to get more money and so on. So if there is a big disparity of income and asset, the central national central government should uh you know redistribute.
SPEAKER_03:And then so Makato, I I would I we've decided while we've been talking, Danler and I, we're going to start a whole series of podcasts now on good money, community currencies. This is so fascinating, we want to continue. And this morning, I do know I was reflecting on this today because this morning on the news they said that uh Elon Musk had today become a half trillionaire. Which point is kind of if you want to see bad money, there it is. Half trillionaire. I mean, that's the point. Let's briefly, I mean, that's the point at which money is becoming meaningless, isn't it?
SPEAKER_00:No. So they have much, much more money they can use, right? Yeah, but there are many, many people they want to have more money, so they want to be distributed from the uh Elon Musk. Once you know they pay a lot of tax to the nation and so on, right? Yes, this is a kind of a policy, a distribution policies and the Keynesian policy and so on. This is a conventional view of the things, but uh our idea is okay, even though there is a big disparity, but uh also there are another negative side. Uh, for example, you know, the uh city street in London in Long, uh not safe. Uh when I traveled in uh long, you know, my backpack was uh loved uh by somebody and so on. But here in Japan, I never experienced that kind of thing. So the safety is a very good thing in living Japan, but it cannot be measured by money. And the relationship to other people and the community is also you know cannot be measured by money. But if we introduce multi-dimensional money, we might evaluate that kind of uh hidden dimensions of the value. That is our idea. So uh, you know, it is possible to have money with two or more dimensions. I suppose, yes, it is possible, but a little bit difficult for us to comprehend. But you know, in the community currency lets, let's was initiated by the Michael Linton in 1983 in uh Bancouba Island, Canada. All participants start with zero in their account, for example, if Mr. A shoveled snow for the Mr. B. The transaction transaction amount is recorded at the plus 10 green dollars in the Mr. A's account and minus 10 green dollars in the Mr. B's account. Mr. B doesn't need to repay Mr. A. If Mr. B gives Mr. C some homegrown vegetable and received a credit of uh 15 greendaras, Mr. C's account will have a debt of 15 glindaras. So this is not a system of repaying, you know, this is not uh uh repaying favors, you know, but rather a system of uh passing on the uh favors. So it's called uh uh it's called a payback uh for the conventional, you know uh uh give and uh leap depay system, but uh this system is called uh uh pay forward. And the credit and debit represented the mutual credit system of lending and borrowing within the community. In this red system, the total of all accounts will always add up to zero. So in other words, even if there are credit and debit recorded in the account of the participant here, there is no money in the community as a whole. The less money, say the glean dollars, cannot be exchanged for the legal currency, the dollars. Therefore, it represents a separate and independent dimension from the dollars. If the dollar is a number on the x-axis, the glyn dollars represent the number on the y-axis. So we have the plane, xy plane. Okay, so which is perpendicular to it? X axis is perpendicular to the y-axis. So this means that uh s cannot be exchanged to the y. So it's it's not in not compatible, it's incompatible system. So in that uh transaction, a store selling coffee beans for$10 would sell them for uh eight dollars plus two green dollars if it it's you know the buyer uh participates. In reds. So they may appear to be the discount for the community participant or the sellers. But the shop does not discard the two green duras it received like a discount coupons. Instead, it can use them for other participants. So, for example, for asking the cleaning in front of the shop and so on. So, in this case, the prices are displayed in two dimensions, and the transaction can be seen to be the taking price. This is back currency. This is bacter money. Expressing value in two dimensions allows for more multidimensional and free expression of value. So a community currency, which previously limited to the specific area, can also be used within the community of people who believe in protecting the global environment and inequality among people. In this case, the community is the community of value or community of interest. So it doesn't need to be local in the sense of neighborhood or in the physical world. It can also be online, virtual community on the internet. Thus, by using vector currency with two or more dimensions, we can express not only quantitative difference in size, but also qualitative differences in perspective and values. This shift from the quality and to co and quantity to quality in money, so this dimensional elevation can enhance our quality of life while also realizing social justice and fairness. So this might seem somewhat abstract and conceptual, but I believe fundamentally changing the nature of can transform not only the economic system but also our consciousness and value. And it also possible if we introduce a digital technique and you know um many kinds of fintechs, we can realize this kind of big still money.
SPEAKER_03:Well, I think we need I think Makoto, we need to make it happen, and from now on, we should all campaign for all of Elon Musk's bonuses to be paid as vector currencies. No more cash for you, Elon. We're gonna have to wrap this up, even though we could I there's so much more I would love to talk to you about. In particular, I know you mentioned it briefly, but you know, that moment of COVID when economic thinking was so fluid, so fascinating, we could have talked loads. But we have to wrap things up. So we have one more question for you, Makoto, which is our network is ironically called do not smile, because we need to make sustainability a subject that brings happiness into the world. So what object, place, or person always makes you smile?
SPEAKER_00:Okay, it's definitely not a lot of money. It's certainly not something I own. It is sharing good food and drinks with friends I can have a fun conversation with, experiencing um beautiful nature and encountering uh plants and animals, and deeply uh contemplating and exploring the truths of the world as a you know uh scientist. So these are all experiences rather than you know scenes. So these are what makes me smile.
SPEAKER_03:We end, oh that's beautiful. We ended on the experiential economy, uh, which I love to bits. Oh, Damler, you better wrap us up.
SPEAKER_02:So thanks to everyone who has listened to our goodgeist podcast brought to you by the Do Not Smile Network of Agencies.
SPEAKER_03:And make sure you listen to future episodes where we'll be talking to more amazing people about how we can all work together to create a more sustainable future. So, Makoto Damler, see you soon. Okay, thank you very much. Bye.
SPEAKER_01:Goodgeist a podcast series on sustainability, hosted by Damla Ozler and Steve Connor. Brought to you by the DNS Network.
