Currency and Commerce in the Early Seventeenth Century

Abstract

The seventeenth-century monetary system was based on a dual coinage of so-called 'real' and 'imaginary' money.2 The former was the medium of exchange-the actual metallic counters circulating from hand to hand. The latter, however, was used for price-quotation; it was the money of account. Real coins had many particular names: angel, groat, rixdollar, quart d'6cu, real, etc. To facilitate commercial transactions these real units were given an official rating in terms of the standard money of account (which might rarely or never exist as actual coins). In England these ratings were given directly to the metallic counters in circulation; on the Continent they would often be given to petty coins, whose monetary value exceeded their commodity value, which would, in their turn, be used to rate larger, metallic units. The following presentation will assume that rating of the larger coins was done directly in imaginary money. Examples of this 'imaginary' money were pounds, shillings, pence in England; livres, sous, deniers in France; and guilders, stuivers, penningen in the Low Countries.3 These could be used to unify a complex 1 See especially: C. H. Wilson, 'Treasure and Trade Balances: The Mercantilist Problem,' Econ. Hist. Rev. 2nd ser. II (i949), 152-6X; E. F. Heckscher, 'Multilateralism, Baltic Trade, and the Mercantilists,' Econ. Hist. Rev. 2nd ser. III (1950), 2i9-8; C. H. Wilson, 'Treasure and Trade Balances: Further Evidence,' Econ. Hist. Rev. 2nd ser. IV (1951), 231-42; J. D. Gould, 'The Royal Mint in the Early Seventeenth Century,' Econ. Hist. Rev. 2nd ser. V (1952), 240-8; J. D. Gould, 'The Trade Depression of the Early i620'S,' Econ. Hist. Rev. 2nd ser. VII (X954), 8i-go; R. W. K. Hinton, 'The Mercantile System in the Time of Thomas Mun,' Econ. Htst. Rev. 2nd ser. VII (1955), 277-90. 2 For a fuller description, see L. Einaudi, 'The Theory of Imaginary Money from Charlemagne to the French Revolution,' reprinted in Enterprise and Secular Change, ed. F. C. Lane and J. C. Riemersma (Homewood, Illinois, 953). Also C. M. Cipolla, Money, Prices, and Civilization