Money and monetary stability in Europe, 1300-1914

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Karaman K. K., Pamuk S., Yildirim-Karaman S.

JOURNAL OF MONETARY ECONOMICS, cilt.115, ss.279-300, 2020 (SSCI) identifier identifier

  • Yayın Türü: Makale / Tam Makale
  • Cilt numarası: 115
  • Basım Tarihi: 2020
  • Doi Numarası: 10.1016/j.jmoneco.2019.07.007
  • Dergi Adı: JOURNAL OF MONETARY ECONOMICS
  • Derginin Tarandığı İndeksler: Social Sciences Citation Index (SSCI), Scopus, IBZ Online, International Bibliography of Social Sciences, ABI/INFORM, Business Source Elite, Business Source Premier, EconLit, Public Affairs Index
  • Sayfa Sayıları: ss.279-300
  • Anahtar Kelimeler: Monetary stability, Monetary standards, Fiat money, Commodity money, Seigniorage, CENTRAL BANK INDEPENDENCE, GOLD STANDARD, CURRENCY DEPRECIATION, COMMODITY MONEY, CREDIBILITY, SEIGNIORAGE, INFLATION, POLITICS, WAGES, ESSAY
  • Marmara Üniversitesi Adresli: Hayır

Özet

This paper investigates the determinants of monetary stability in Europe from the late medieval era until World War I. Through this period, the anchor for monetary policy was the silver or gold value of the monetary unit. States, however, frequently abandoned this anchor, some depreciating their monetary units against silver and gold less than 10-fold and others more than 10,000-fold between 150 0 and 1914. To understand the determinants of these differences, we compile a new and comprehensive monetary history dataset for all major states in Europe and test alternative theories. We find strong evidence that political factors, and in particular, fiscal capacity, political regime and warfare explain patterns of monetary stability. This finding is robust to addressing endogeneity, controlling for the instability induced by the mechanics of the monetary system and accounting for the impacts of new monetary technologies and the advent of fiat standard. (c) 2019 Elsevier B.V. All rights reserved.