The emergence of the Classical Gold Standard

Research output: Working paper

Standard

The emergence of the Classical Gold Standard. / Morys, Matthias.

University of York Economic History Working Paper, 2012.

Research output: Working paper

Harvard

Morys, M 2012 'The emergence of the Classical Gold Standard' University of York Economic History Working Paper.

APA

Morys, M. (2012). The emergence of the Classical Gold Standard. University of York Economic History Working Paper.

Vancouver

Morys M. The emergence of the Classical Gold Standard. University of York Economic History Working Paper. 2012.

Author

Morys, Matthias. / The emergence of the Classical Gold Standard. University of York Economic History Working Paper, 2012.

Bibtex - Download

@techreport{e2f2c6c9dafc49dda7e7c4e46ba4908a,
title = "The emergence of the Classical Gold Standard",
abstract = "This paper asks why the Classical Gold Standard (1870s - 1914) emerged: Why did the vastmajority of countries tie their currencies to gold in the late 19th century, while there was onlyone country {\^a}€“ the UK {\^a}€“ on gold in 1850? The literature distinguishes a number of theories toexplain why gold won over bimetallism and silver. We will show the pitfalls of these theories(macroeconomic theory, ideological theory, political economy of choice between gold andsilver) and show that neither the early English lead in following gold nor the German shift togold in 1873 were as decisive as conventional accounts have it. Similarly, we argue that thesilver supply shock materializing in the early 1870s was only the nail in the coffin of silverand bimetallic standards. Instead, we focus on the impact of the 1850s gold supply shock (dueto the immense gold discoveries in California and Australia) on the European monetarysystem. Studying monetary commissions in 13 European countries between 1861 and 1874,we show that the pan-European movement in favour of gold monometallism was motivatedby three key factors: gold being available in sufficient quantities to actually contemplate thetransition to gold monometallism for a larger number of countries (while silver had becomeextremely scarce in the bimetallic bloc, which was the single most important currency area interms of GDP), widespread misgivings over the working of bimetallism and the fact that goldcould encapsulate substantially more value in the same volume than silver (i.e. coinconvenience). In our view, then, the emergence of the Classical Gold Standard was imminentin the late 1860s; which European country would move first {\^a}€“ which is often erroneouslyattributed to Germany {\^a}€“ is of secondary importance.",
author = "Matthias Morys",
year = "2012",
language = "English",
publisher = "University of York Economic History Working Paper",
type = "WorkingPaper",
institution = "University of York Economic History Working Paper",

}

RIS (suitable for import to EndNote) - Download

TY - UNPB

T1 - The emergence of the Classical Gold Standard

AU - Morys, Matthias

PY - 2012

Y1 - 2012

N2 - This paper asks why the Classical Gold Standard (1870s - 1914) emerged: Why did the vastmajority of countries tie their currencies to gold in the late 19th century, while there was onlyone country – the UK – on gold in 1850? The literature distinguishes a number of theories toexplain why gold won over bimetallism and silver. We will show the pitfalls of these theories(macroeconomic theory, ideological theory, political economy of choice between gold andsilver) and show that neither the early English lead in following gold nor the German shift togold in 1873 were as decisive as conventional accounts have it. Similarly, we argue that thesilver supply shock materializing in the early 1870s was only the nail in the coffin of silverand bimetallic standards. Instead, we focus on the impact of the 1850s gold supply shock (dueto the immense gold discoveries in California and Australia) on the European monetarysystem. Studying monetary commissions in 13 European countries between 1861 and 1874,we show that the pan-European movement in favour of gold monometallism was motivatedby three key factors: gold being available in sufficient quantities to actually contemplate thetransition to gold monometallism for a larger number of countries (while silver had becomeextremely scarce in the bimetallic bloc, which was the single most important currency area interms of GDP), widespread misgivings over the working of bimetallism and the fact that goldcould encapsulate substantially more value in the same volume than silver (i.e. coinconvenience). In our view, then, the emergence of the Classical Gold Standard was imminentin the late 1860s; which European country would move first – which is often erroneouslyattributed to Germany – is of secondary importance.

AB - This paper asks why the Classical Gold Standard (1870s - 1914) emerged: Why did the vastmajority of countries tie their currencies to gold in the late 19th century, while there was onlyone country – the UK – on gold in 1850? The literature distinguishes a number of theories toexplain why gold won over bimetallism and silver. We will show the pitfalls of these theories(macroeconomic theory, ideological theory, political economy of choice between gold andsilver) and show that neither the early English lead in following gold nor the German shift togold in 1873 were as decisive as conventional accounts have it. Similarly, we argue that thesilver supply shock materializing in the early 1870s was only the nail in the coffin of silverand bimetallic standards. Instead, we focus on the impact of the 1850s gold supply shock (dueto the immense gold discoveries in California and Australia) on the European monetarysystem. Studying monetary commissions in 13 European countries between 1861 and 1874,we show that the pan-European movement in favour of gold monometallism was motivatedby three key factors: gold being available in sufficient quantities to actually contemplate thetransition to gold monometallism for a larger number of countries (while silver had becomeextremely scarce in the bimetallic bloc, which was the single most important currency area interms of GDP), widespread misgivings over the working of bimetallism and the fact that goldcould encapsulate substantially more value in the same volume than silver (i.e. coinconvenience). In our view, then, the emergence of the Classical Gold Standard was imminentin the late 1860s; which European country would move first – which is often erroneouslyattributed to Germany – is of secondary importance.

M3 - Working paper

BT - The emergence of the Classical Gold Standard

PB - University of York Economic History Working Paper

ER -