Having an asset-backed currency with a unit of sustainably managed land as the asset backing (without using a fractionally backed approach), would generate an incentive for beneficial actions, because the creation (or conversion) of (privately owned) land to sustainably managed land would in itself be a good thing while at the same time being wealth-creating for the landowner. Of necessity, governments or central banks would need to own (or control) significant reserves of sustainably managed land in order to provide this asset backing to their currencies. Not a problem to achieve in practice – they already own much land and could always use compulsory purchase powers to create adequate levels of such reserves within a balanced economy and ecosystem.
This new form of currency, which one could call, for example, the "Ecopound", providing it was taken up by reputable governments and central banks, could provide all the benefits of being a medium of exchange and could also provide a store of value (overcoming some of the shortcomings of gold as a historical form of asset backing) while encouraging the maintenance (and expansion) of the stock of sustainable land which backs it. By the very nature of the finite supply of the asset backing, this currency would protect against the worst boom-and-bust cycles of existing economic cycles, by providing a stable and limited supply of the asset (and therefore of the money supply). It would also prevent a recurrence of the financial meltdown of circa 2008 and the fall of banks such as happened to Northern Rock at that time.
This is a repost of a blog post of mine from a few years ago:
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