THE HISTORY OF FINANCIAL SYSTEMS AND MONETARY CIRCULATION IN EUROPE IN THE ERA OF THE GREAT FRENCH REVOLUTION AND THE NAPOLEONIC WARS (LATE XVIIITH – EARLY XIXTH CENTURY)

Abstract

The article is devoted to the consideration of the financial policies of France, Britain, Austria and Russia in the late XVIIIth and early XIXth century in connection with the release a significant amount of paper currency (bank notes) into circulation in the era of the Great French Revolution and the Napoleonic Wars. The article focuses on the monetary policy conducted by the government of Alexander I.The adoption of bank notes almost everywhere in Europe led to a change in their function. In addition to covering extraordinary military expenses, the paper currency had a new function – they were used as an instrument of financial policy and state regulation of the national monetary system. Mass issue of bank notes led to their depreciation. Although stabilization of currency circulation had some differences in the abovementioned countries, it was mostly based on the withdrawal of bank notes from circulation. The Russian Empire believed it was preferable to use the experience of the Habsburg Monarchy. The strategy of the Austrian government was devoted to complete withdrawal of one part of the bank notes and replacement of the other one with private bank notes in form and status, however state participation was preserved in the capital of the Privileged Austrian National Bank.