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An Empirical Assessment of the Swedish Bullionist Controversy

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  • Nils Herger

Abstract

In the 18th century, a fierce political debate broke out in Sweden about the causes of an extraordinary depreciation of the currency. More specifically, the deteriorating value of the Swedish currency was blamed arbitrarily on monetary causes (e.g., the overissuing of banknotes) and on non‐monetary causes (such as balance‐of‐payments deficits). This paper provides a comprehensive empirical assessment of this so‐called “Swedish Bullionist Controversy”. The results of vector autoregressions suggest that increasing amounts of paper money did give rise to inflation and a depreciation of the exchange rate. Conversely, non‐monetary factors were probably less important for these developments.

Suggested Citation

  • Nils Herger, 2020. "An Empirical Assessment of the Swedish Bullionist Controversy," Scandinavian Journal of Economics, Wiley Blackwell, vol. 122(3), pages 911-936, July.
    • Handle: RePEc:bla:scandj:v:122:y:2020:i:3:p:911-936
    DOI: 10.1111/sjoe.12337
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    References listed on IDEAS

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