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Lowndes and Locke on the value of money


  • Ormazabal Sánchez, Kepa Mirena


In this paper I analyze the monetary theories underlying the arguments that Locke and Lowndes directed against each other during their discussions around the Great Recoinage of 1696. My primary place of interest is the theory that Marx calls “the theory of the nominal standard of money”, which is the theory that the monetary names stand for definite quantities of value, so that the unit of money is a unit of value. I argue that Lowndes appealed to this theory and that the criticism of it offered by Locke is fundamentally correct, in spite of which Lowndes’ language and ideas can be very often found in current discussions about monetary problems. In the course of this theoretical investigation, I have come across the critical commentaries of Steuart and Marx, which are not paid the attention they deserve in the standard literature. Marx commentary is of special interest because it contains a solid theoretical explanation of the concepts appealed to in the debate and puts it in a very interesting practical perspective.

Suggested Citation

  • Ormazabal Sánchez, Kepa Mirena, 2007. "Lowndes and Locke on the value of money," IKERLANAK 2007-29, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
  • Handle: RePEc:ehu:ikerla:6481

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    References listed on IDEAS

    1. Sargent, Thomas J & Velde, Francois R, 1999. "The Big Problem of Small Change," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 31(2), pages 137-161, May.
    2. Richard A. Kleer, 2004. "“The ruine of their Diana”: Lowndes, Locke, and the Bankers," History of Political Economy, Duke University Press, vol. 36(3), pages 533-556, Fall.
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    More about this item


    monetary theory; value of money; english monetary history; history of english banking;

    JEL classification:

    • B11 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - Preclassical (Ancient, Medieval, Mercantilist, Physiocratic)
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy


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