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Fiscal Discriminations in Three Wars

  • George J. Hall

    ()

    (Economics Department, Brandeis University)

  • Thomas J. Sargent

    ()

    (New York University)

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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File URL: http://www.brandeis.edu/departments/economics/RePEc/brd/doc/Brandeis_WP56.pdf
File Function: First version, 2013
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Paper provided by Brandeis University, Department of Economics and International Businesss School in its series Working Papers with number 56.

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Length: 40 pages
Date of creation: May 2013
Date of revision:
Handle: RePEc:brd:wpaper:56
Contact details of provider: Postal:
MS032, P.O. Box 9110, Waltham, MA 02454-9110

Web page: http://www.brandeis.edu/departments/economics/

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