Abstract
Consideration of community level economic initiatives has been weakened by poor conceptualization and analysis of the cultural dimension. Culture is not only important in shaping the emergence and form of community economic initiatives but such initiatives play an important role in the reproduction and modification of local cultures. At the Portuguese national level, an historic culture of apathy and non‐participation is currently undergoing change as a result of processes of political and socio‐economic restructuring, to produce an increase in local‐level actions. The interaction of such processes with local differences in cultural and economic spheres has produced an uneven development of community initiatives. On the Serra do Montemuro, an area of peasant economic practice and culture in the interior of Portugal, community economic strategies are attempting to commercialize traditional craft skills. These initiatives offer some possibilities for diversifying sources of income at a household level, but the rationality for involvement is still principally drawn from traditional peasant culture. Recognition of the nature of the interrelationship between economic practice and the cultural context permits greater appreciation of both the possibilities and constraints for community action, and has important implications for policy formation.