Miscounting Money of Colonial America
Farley Grubb has developed an ambitious new money-stock time series for colonial Pennsylvania that uses the ingenious method of examining newspaper advertisements promising rewards (e.g., for help in catching runaway slaves) to estimate monies in circulation (Grubb 2004). Grubb asserts that promises of reward payments in â€œpoundsâ€ refer to bills of credit. We contest his interpretation, arguing that â€œpoundsâ€ denotes merely a unit of account. Similarly, ads promising â€œdollarsâ€ cannot be taken to refer to silver coins. Grubb mistakes the mention of a unit of account for the specification of a medium of exchange. We also show that Grubbâ€™s methods are riddled with misinterpretations and inconsistencies, some of which arise from rather serious errors in basic scholarship. For example, Grubb denies that bills of credit readily passed current across the Middle Colonies, although it is a well-established fact. To concede it, however, would upset both his colony-level money supply estimates and his argument that the Constitutional ban on state-issued paper money had nothing to do with seigniorage. Grubbâ€™s time series differs significantly from spot estimates of the money supply arrived at using methods that Grubb himself champions elsewhere, as well as estimates based on archival data.
Volume (Year): 3 (2006)
Issue (Month): 1 (January)
|Contact details of provider:|| Postal: Enterprise Hall, Room 354, 4400 University Drive, 3G4 Fairfax, VA 22030|
Phone: (703) 993-1151
Web page: https://econjwatch.org/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- A. Piatt Andrew, 1904. "The End of the Mexican Dollar," The Quarterly Journal of Economics, Oxford University Press, vol. 18(3), pages 321-356.
- Sumner, Scott, 1993. "Colonial Currency and the Quantity Theory of Money: A Critique of Smith's Interpretation," The Journal of Economic History, Cambridge University Press, vol. 53(01), pages 139-145, March.
- Ziliak, Stephen T. & McCloskey, Deirdre N., 2004. "Size matters: the standard error of regressions in the American Economic Review," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 33(5), pages 527-546, November.
- Ronald W. Michener & Robert E. Wright, 2005. "State "Currencies" and the Transition to the U.S. Dollar: Clarifying Some Confusions," American Economic Review, American Economic Association, vol. 95(3), pages 682-703, June.
- Michener, Ron, 1988. "Backing Theories and the Currencies of Eighteenth-Century America: A Comment," The Journal of Economic History, Cambridge University Press, vol. 48(03), pages 682-692, September.
- Bennett T. McCallum, 1990.
"Money and Prices in Colonial America: A New Test of Competing Theories,"
NBER Working Papers
3383, National Bureau of Economic Research, Inc.
- McCallum, Bennett T, 1992. "Money and Prices in Colonial America: A New Test of Competing Theories," Journal of Political Economy, University of Chicago Press, vol. 100(1), pages 143-61, February.
- Bruce D. Smith, 1985. "American Colonial Monetary Regimes: The Failure of the Quantity Theory and Some Evidence in Favour of an Alternative View," Canadian Journal of Economics, Canadian Economics Association, vol. 18(3), pages 531-65, August.
- Lydon, James G., 1965. "Fish and Flour for Gold: Southern Europe and the Colonial American Balance of Payments," Business History Review, Cambridge University Press, vol. 39(02), pages 171-183, June.
- Hanson, John R, II, 1979. "Money in the Colonial American Economy: An Extension," Economic Inquiry, Western Economic Association International, vol. 17(2), pages 281-86, April.
- Farley Grubb, 2003. "Creating the U.S. Dollar Currency Union, 1748–1811: A Quest for Monetary Stability or a Usurpation of State Sovereignty for Personal Gain?," American Economic Review, American Economic Association, vol. 93(5), pages 1778-1798, December.
- Farley Grubb, 2003.
"Two Theories of Money Reconciled: The Colonial Puzzle Revisited with New Evidence,"
03-03, University of Delaware, Department of Economics.
- Farley Grubb, 2005. "Two Theories of Money Reconciled: The Colonial Puzzle Revisited with New Evidence," NBER Working Papers 11784, National Bureau of Economic Research, Inc.
- Stephen T. Ziliak & Deirdre N. McCloskey, 2004. "Size Matters: The Standard Error of Regressions in the American Economic Review," Econ Journal Watch, Econ Journal Watch, vol. 1(2), pages 331-358, August.
- Smith, Bruce D, 1985. "Some Colonial Evidence on Two Theories of Money: Maryland and the Carolinas," Journal of Political Economy, University of Chicago Press, vol. 93(6), pages 1178-1211, December.
- Richard A. Lester, 1938. "Currency Issues to Overcome Depressions in Pennsylvania, 1723 and 1729," Journal of Political Economy, University of Chicago Press, vol. 46, pages 324.
- Grubb, Farley, 2004. "The circulating medium of exchange in colonial Pennsylvania, 1729-1775: new estimates of monetary composition, performance, and economic growth," Explorations in Economic History, Elsevier, vol. 41(4), pages 329-360, October.
When requesting a correction, please mention this item's handle: RePEc:ejw:journl:v:3:y:2006:i:1:p:4-44. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jason Briggeman)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.