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Fiscal discriminations in three wars

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  • Hall, George J.
  • Sargent, Thomas J.

Abstract

In 1790, a U.S. paper dollar was widely held in disrepute (something shoddy was not ‘worth a Continental’). By 1879, a U.S. paper dollar had become ‘as good as gold’. These outcomes emerged from how the U.S. federal government financed three wars: the American Revolution, the War of 1812, and the Civil War. In the beginning, the U.S. government discriminated greatly in the returns it paid to different classes of creditors; but that pattern of discrimination diminished over time in ways that eventually rehabilitated the reputation of federal paper money as a store of value.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Monetary Economics.

Volume (Year): 61 (2014)
Issue (Month): C ()
Pages: 148-166

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Handle: RePEc:eee:moneco:v:61:y:2014:i:c:p:148-166

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Web page: http://www.elsevier.com/locate/inca/505566

Related research

Keywords: Repudiation; Reputation; Discrimination; Legal tender; Greenbacks; Alexander Hamilton; Albert Gallatin; Ulysses S. Grant;

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References

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. Hall and Sargent: Fiscal Prioritization: Lessons from Three Wars
    by Mark Thoma in Economist's View on 2013-05-18 17:49:18

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