The Miracle of Wörgl 💫 Short Story based on a true event
In the small Austrian town of Wörgl, during the harshest period of the Great Depression, the scene was devastating: homeless people everywhere, cold, hunger, and desolation… 1931 was especially disastrous; one by one, the shopkeepers closed their businesses: Hans the barber, Maximilian the locksmith, Stefan the blacksmith, even little Florian, the shoeshine boy… Some took their own lives, and others had no choice but to abandon their trades and face the abyss of mortifying beggary.
The mayor, Michael Unter, overwhelmed by such a collapse, desperately introduced a local currency with the unremarkable name of Arbeitsbestätigung (“work certificate”) to stimulate the economy. The idea was that this kind of currency would lose value over time (1% monthly), encouraging people to spend it quickly instead of saving it.
In the battered Austrian municipality, this currency with the “oxidation rate” increased the circulation of money, reduced unemployment, and revitalized the local economy, as people wanted to spend it as soon as possible so it wouldn’t lose value. In a short time, Wörgl experienced such an improvement that the experience became known as “The Miracle of Wörgl.”
The news spread quickly across the country. So much so that several towns and cities suffering from the severe blow of the economic crisis became interested in the experiment and sent emissaries to talk to the mayor. Michael Unter was delighted to reveal the intricacies of such an unusual miracle, of the joy that had returned the smile and hope to so many fellow citizens who had recently been in the darkest pit of despair.
However, the news also reached the ears of the governor of the Central Bank of Austria, who, fearing such a threat to the monopoly of currency issuance, banned the experiment.
Despite its short life, the “Miracle of Wörgl” remains an interesting example of how monetary innovations can positively impact a local economy.
Michael Unter
