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The Debasement Puzzle: An Essay on Medieval Monetary History

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Author Info
Rolnick, Arthur J.
Velde, Fran?ois R.
Weber, Warren E.

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Abstract

We establish several facts about medieval monetary debasements: they were followed by unusually large minting volumes and by increased seigniorage; old and new coins circulated concurrently; and, at least some of the time, coins were valued by weight. These facts constitute a puzzle because debasements provide no additional inducements to bring coins to the mint. On theoretical and empirical grounds, we reject explanations based on by-tale circulation, nominal contracts, and sluggish price adjustment. We conclude that debasements pose a challenge to monetary economics.

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Publisher Info
Article provided by Cambridge University Press in its journal The Journal of Economic History.

Volume (Year): 56 (1996)
Issue (Month): 04 (December)
Pages: 789-808
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Handle: RePEc:cup:jechis:v:56:y:1996:i:04:p:789-808_01

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  1. John H. Munro, 2009. "Coinage and Monetary Policies in Burgundian Flanders during the late-medieval 'Bullion Famines',. 1384 - 1482," Working Papers tecipa-361, University of Toronto, Department of Economics. [Downloadable!]
  2. Luciano Pezzolo, 2006. "The rise and decline of a great power: Venice 1250-1650," Working Papers 2006_27, University of Venice "Ca' Foscari", Department of Economics. [Downloadable!]
  3. Manjong Lee & Neil Wallace, 2006. "Optimal divisibility when money is costly to produce," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 9(3), pages 541-556, July. [Downloadable!] (restricted)
  4. Gerald P. Dwyer, Jr. & James R. Lothian, 2002. "International money and common currencies in historical perspective," Working Paper 2002-7, Federal Reserve Bank of Atlanta. [Downloadable!]
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  5. Gerald P. Dwyer, Jr. & James R. Lothian, 2003. "The economics of international monies," Working Paper 2003-37, Federal Reserve Bank of Atlanta. [Downloadable!]
    Other versions:
  6. Sussman, Nathan & Zeira, Joseph, 2002. "Commodity Money Inflation: Theory and Evidence from France in 1350-1436," Working Paper Series rwp02-008, Harvard University, John F. Kennedy School of Government. [Downloadable!]
    Other versions:
  7. Oliver Volckart, 2007. "Rules, Discretion or Reputation? Monetary Policies and the Efficiency of Financial Markets in Germany, 14th to 16th Centuries," SFB 649 Discussion Papers SFB649DP2007-007, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany. [Downloadable!]
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