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After the Great Debasement, 1544-51: did Gresham’s Law apply?

Li, Ling-Fan (2009) After the Great Debasement, 1544-51: did Gresham’s Law apply? Economic History Working Papers (126/09). Department of Economic History, London School of Economics and Political Science, London, UK.

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In England, across the whole period of the Great Debasement, the mint issued six different kinds of silver coins and three kinds of gold coins. According to Gresham’s Law, coins with the same face value but different intrinsic values can not circulate side by side for too long: only those coins with lower intrinsic values stay in circulation; those with relatively high intrinsic values would be hoarded, exported, or melted down. Neither contemporary sources nor modern research about the disappearance of good money over this period has provided any solid quantitative assessment of the effectiveness of Gresham’s Law. This paper intends to produce such an assessment. For this purpose, two types of evidence are examined: the composition of the re-coinage of 1560, and the trend of the exchange rate. The result shows that contrary to popular belief, Gresham’s Law was rather ineffective in mid-sixteenth-century England.

Item Type: Monograph (Working Paper)
Official URL:
Additional Information: © 2009 Ling-Fan Li
Divisions: Economic History
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HG Finance
D History General and Old World > DA Great Britain
Date Deposited: 11 May 2010 15:03
Last Modified: 16 May 2024 11:49

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