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The debasement puzzle: an essay on medieval monetary history

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  • Arthur J. Rolnick
  • Francois R. Velde
  • Warren E. Weber

Abstract

This study establishes 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, the authors reject explanations based on by-tale circulation, nominal contracts, and sluggish price adjustment. They conclude that debasements pose a challenge to monetary economics. This article was originally published in the Journal of Economic History (December 1996, vol. 56, no. 4, pp. 789--808). It is reprinted in the Federal Reserve Bank of Minneapolis Quarterly Review with the permission of Cambridge University Press.

Suggested Citation

  • Arthur J. Rolnick & Francois R. Velde & Warren E. Weber, 1997. "The debasement puzzle: an essay on medieval monetary history," Quarterly Review, Federal Reserve Bank of Minneapolis, vol. 21(Fall), pages 8-20.
    • Handle: RePEc:fip:fedmqr:y:1997:i:fall:p:8-20:n:v.21no.4
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    References listed on IDEAS

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    1. N. J. Mayhew, 1974. "Numismatic Evidence and Falling Prices in the Fourteenth Century," Economic History Review, Economic History Society, vol. 27(1), pages 1-15, February.
    2. Riley, James C. & McCusker, John J., 1983. "Money supply, economic growth, and the quantity theory of money: France, 1650-1788," Explorations in Economic History, Elsevier, vol. 20(3), pages 274-293, July.
    3. Bordo, Michael D., 1986. "Money, deflation and seigniorage in the fifteenth century: A review essay," Journal of Monetary Economics, Elsevier, vol. 18(3), pages 337-346, November.
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