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Power politics and princely debts: why Germany’s common currency failed, 1549-1556

Volckart, Oliver (2015) Power politics and princely debts: why Germany’s common currency failed, 1549-1556. Economic History working paper series (223/2015). The London School of Economics and Political Science, London, UK.

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Abstract

The article argues that in the first half of the sixteenth century the need to avoid rounds of competitive debasements was the primary motive for the creation of a common currency valid in the whole Holy Roman Empire. In the years 1549 to 1551, the estates came close to achieving this. In contrast to what is suggested in the literature, their attempt did not fail because the Empire was economically poorly integrated or the will to co-operate was lacking. Rather, it failed because during the talks, the estates lost sight of the original motive, the princes favouring a bimetallic system that they hoped would allow them deflating the real value of their debts, and Charles V undervaluing the taler in the hope that this would weaken political opponents. These decisions antagonised important actors; when it proved impossible to enforce them, the Empire’s common currency failed.

Item Type: Monograph (Working Paper)
Official URL: http://www.lse.ac.uk/economicHistory/home.aspx
Additional Information: © 2015 The Authors
Divisions: LSE
Subjects: D History General and Old World > D History (General) > D901 Europe (General)
H Social Sciences > HB Economic Theory
H Social Sciences > HC Economic History and Conditions
JEL classification: E - Macroeconomics and Monetary Economics > E4 - Money and Interest Rates > E42 - Monetary Systems; Standards; Regimes; Government and the Monetary System
E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E52 - Monetary Policy (Targets, Instruments, and Effects)
N - Economic History > N1 - Macroeconomics and Monetary Economics; Growth and Fluctuations > N13 - Europe: Pre-1913
N - Economic History > N2 - Financial Markets and Institutions > N23 - Europe: Pre-1913
N - Economic History > N4 - Government, War, Law, and Regulation > N43 - Europe: Pre-1913
Date Deposited: 24 Nov 2015 16:37
Last Modified: 30 Jan 2019 12:23
URI: http://eprints.lse.ac.uk/id/eprint/64496

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