Resource title

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

Resource image

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

Resource description

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.

Resource author

Resource publisher

Resource publish date

Resource language

en

Resource content type

application/pdf

Resource resource URL

http://eprints.lse.ac.uk/27874/1/WP126.pdf

Resource license