"local" economy

I've been suffering through the debate/conversation between my dear paradosis and some of his friends (they are really "our" friends but in this their his--LOL) on the topic of "local economy. One of them says that there really is no such thing as local economy and the other disagrees. I do have to admit to possibly misunderstanding the whole debate but that is what I got out of it. So I as this is really the only place I can get a word in edgewise when the conversation is being carried with this particular group I thought I'd post my two cents. First I might say that I really believe that they are simply debating the difference between micro(local) and macro(global) economics without even knowing it. And if you put it that way they are both right and their it's a no win debate for sure.
But my two cents on the whole "does local economy even exist" is this...if we all stopped buying from the local businesses then they will cease to exist therefore creating a completely useless community and it will die. Thus there IS local economy in that respect. YES, our community not only supports on a local level but also in many ways supports on a global level. You cannot have one without the other for sure. The global economy would cease to exist if there was not many different local economies to make it up.
I just happen to read on the night of this said debate from a great book called "Rural Renaissance" in the section called Supporting the Local Economy...
Ecological communities offer insights as to how we might approach our local community. When we take time to examine our energy flows, the cycling of matter and materials, the interconnection of food webs, the movement from chemical-based mono-culture to organic polyculture, and other factors on our farm, we better undertstand how life manages to sustain itself--often, despite unwise human decisions.
Communities that exist within ecological perspectives, tend to thrive as well, providing healthy, safe and viable livelihoods for their members. Country and samll-town living thrives on shared experience and cooperation.
In an ecosystem, numerous self-preserving mechanisms are in place to keep a system in balance. Healthy communities are much the same. The citizens must be active, engaged and empowered for the community to be vibrant. We are active participants in our community's continued prosperity, development and future.

Yes, I know that maybe I'm making this topic much simplier than they possibly have taken it in their conversations and debates, but why not?