Demurrage
Seeds decay slowly over time. This decay is called demurrage and operates as a maintenance fee applied to the seed at rest.
A seed that remains unused during a prolonged period loses a monthly fraction of its value in accordance with the table published in the Treasury annex. A seed in active circulation maintains its full value.
The purpose of demurrage is explicit: to discourage private accumulation and to maintain circulation as the condition of existence of the system. Demurrage materializes, in economic terms, the principles established in Articles II (Waqf Corpus) and III (Ayni reciprocity).
The demurrage rate is fixed by tricameral agreement and reviewed every two years. The review considers the health of the circuit, the total volume of seeds in circulation, the composition of the Waqf Corpus and the relative activity of the various territorial zones.
Commentary
Demurrage has historical precedent. The German economist Silvio Gesell proposed it at the beginning of the twentieth century as a remedy against monetary hoarding. Specific experiments (the German Wära of 1929, the Wörgl Freigeld in Austria during 1932 and 1933) demonstrated its operational viability with notable social results, even when central authorities ultimately suspended them. Contemporary cooperative economics recovers demurrage as a mechanic for local circuits. Alerta inherits that tradition and inscribes it in its Constitution.
The term "demurrage" comes from maritime law, where it names the penalty charged to a consignee who retains cargo beyond the agreed time. The monetary application preserves the principle: there is a cost associated with retaining something that should circulate.
The adoption of demurrage in Alerta responds to coherence with Article III: no resource should be withdrawn from the circuit of reciprocity. A hoarded seed ceases to fulfill its function. Demurrage returns that latent value to the circuit through the pressure to redeem before decay erodes it.
Operational parameters
The current demurrage rate is a technical decision fixed by tricameral agreement. Its operational range, its application mechanics and its review calendar are documented in the Treasury technical annex. The technical considerations include:
- Nominal monthly rate. The monthly fraction of decay applied to resting balances.
- Activity threshold. The minimum level of use below which a seed enters the decay calculation.
- Grace period. The time during which a newly issued seed does not accumulate decay.
- Destination of discounted value. The portion of value eroded by demurrage returns to the Waqf Corpus, maintaining the integrity of the system's redemption floor.
Cross-references
- Article II · The Waqf Corpus receives the discounted value
- Article III · Ayni reciprocity is the principle that justifies demurrage
- Article VIII · The seed is the subject of demurrage
- Article XII · Financial transparency reports the operation