PART I.

The principles of money deduced, and applied to the coin of Great Britain.

INTRODUCTION, 523

CHAP. I. Of money of accompt, 526 What money is —— Definitions —— Money a scale for measuring value, —— Principles which determine the value of things 527 Prices not regulated by the quantity of money, —— But by the relative proportion between commodities and 528 the wants of mankind, Necessity of distinguishing between money and price, 529 Money of accompt what, and how contrived, —— Examples of it, 531 Bank money, —— Angola money, ——

CHAP. II. Of artificial or material money, —— Usefulness of the precious metals for the making money, 532 Adjusting a standard, what? 533 Debasing and raising a standard, what? 534 The alteration of a standard, how to be discovered? —— Of alloy, ——

CHAP. III. Incapacities of the metals to perform the office 535 of an invariable measure of value,

1. They vary in their relative value to one another, —— All measures ought to be invariable, —— Consequences when they vary, 536 Defects of a silver standard, 537 Arguments in favour of it, —— Answers to these arguments, 538 Usefulness of an universal measure, 539 They have two values, one as coin, and one as metals, 540 Smaller inconveniences attending material money, —— It wears in circulation, —— It is inaccurately coined, 541 The coinage adds to its value, without adding to its —— weight, The value of it may be arbitrarily changed, —— Trade profits of the smallest defects in the coin, ——

CHAP. IV. Methods which may be proposed for lessening the 542 several inconveniences to which material money is liable, Use of theory in political matters, —— Five remedies against the effects of the variation —— between the value of the metals, Remedies against the other inconveniences, 544 Against the wearing of the coin, —— Against inaccuracy of coinage, —— Against the expence of coinage, —— Against arbitrary changes in the value of coin, 545

CHAP. V. Variations to which the value of the money-unit is —— exposed from every disorder in the coin, How the market price of the metals is made to vary, —— The variation ought to be referred to the _rising_ 546 metal, and never to the _sinking_, How the money-unit of accompt is made to vary in its 547 value from the variation of the metals, Consequences of this, —— The true unit is the mean proportional between the —— value of the metals, The unit to be attached to the mean proportion upon a 548 new coinage, not after the metals have varied, It is better to affix the unit to one, than to both 549 metals, Variation to which the money-unit is exposed from the —— wearing of the coin, Variations to which the money-unit is exposed, from the 550 inaccuracy in the fabrication of the money, Variation to which the money-unit is exposed from the 551 imposition of coinage, When coinage is imposed, bullion must be cheaper than —— coin, Exception from this rule, 552 Variation to which the money-unit is exposed by the —— arbitrary operations of Princes in raising and debasing the coin,

CHAP. VI. How the variations in the intrinsic value of the 553 unit of money must affect all the domestic interests of a nation, How this variation affects the interests of debtors and —— creditors, A mistake of Mr. Locke, 555 When the value of the unit is diminished, creditors 556 lose; when it is augmented, debtors lose,

CHAP. VII. Of the disorder in the British coin, so far as it 558 occasions the melting down or the exporting of the specie, Defects in the British coin, —— Of the standard of the English coin and money-unit, —— A pound sterling by statute contains 1718.7 grains troy 559 fine silver, The guinea 118.644 grains fine gold, —— Coinage in England free, —— The standard not attached to the gold coin till the 560 year 1728, Consequences of this regulation to debase the standard, —— That debtors will not pay in silver but in gold, —— That some people consider coin as money of accompt, 561 Others consider it as a metal, —— Operations of money-jobbers, when the coin deviates 562 from the market proportion of the metals, or from the legal weight, They melt down when the metals in it are wrong —— proportioned, And when the coin is of unequal weight, —— Why silver bullion is dearer than coin, —— Because that species has risen in the market price as 563 bullion, and not as coin, What regulates the price of bullion? 564 1. The intrinsic value of the currency, —— 2. A demand for exporting bullion, 565 3. Or for making of plate, —— Exchange _raises_, and the mint price _brings down_ —— bullion, Continuation of the operations of money-jobbers: their 566 rule for melting the coin, The price in guineas equal to the price of shillings of —— 65 in the pound troy, When guineas may be melted down with profit, —— Silver is exported preferably to gold, 567 This hurtful, when done by foreigners, ——

CHAP. VIII. Of the disorder in the British coin, so far as it 568 affects the value of the pound sterling currency, Two legal pounds sterling in England, —— And several others, in consequence of the wearing of 569 the coin, Why any silver coin remains in England, —— Value of a pound sterling current determined by the —— operations of trade, To the mean value of all the currencies, 570 Exchange a good measure for the value of a pound —— sterling, The use of paper money not hurtful in debasing the 571 standard, The pound sterling not regulated by statute, but by the —— mean value of the current money, Why exchange appears so commonly against England, —— How the market price of bullion shews the value of the —— pound sterling, Shillings at present weigh no more than 1⁄65 of a pound 572 troy, And are worn 4.29 troy grains lighter than their —— standard weight, A pound sterling worth, at present, no more than 1638 573 grains troy fine silver, according to the price of bullion, And according to the course of exchange, —— Shillings coined at 65 in the pound troy, would be in 574 proportion with the gold, Which shews that the standard has been debased, —— And that the preserving it where it is, is no new —— debasement, Proof that the standard has been debased by law, 575 And is at present reduced to the value of the gold, ——

CHAP. IX. Historical account of the variations of the British 576 coin, Purport of this treatise not to dictate, but to —— inquire, How the disorder in the coin may be remedied without —— inconveniences, By making the nation itself choose the remedy, 577 If the present standard is departed from, every other —— that might be pitched on is arbitrary, People imagine the present standard is the same with 578 that of Queen Elizabeth, Debasements of the standard during the reformation, —— Raised by Edward VI. —— Debased by Elizabeth, —— Supported by her successors, —— Until it was debased by the clipping, after the 579 revolution, Lowndes’s scheme refuted by Locke: the standard raised 580 to that of Elizabeth, and the consequences of that measure, Silver has been rising from the beginning of this —— century, The English standard has been debased by law, since —— 1726, The trading interest chiefly to be blamed for this 581 neglect, Debasing the standard chiefly affects permanent —— contracts, And prevents prices from rising as they should do, ——

CHAP. X. Of the disorder of the British coin, so far as it 582 affects the circulation of gold and silver coin, and of the consequences of reducing guineas to twenty shillings, Why silver coin is so scarce, 583 Consequences of fixing the guineas at 20 shillings, —— with regard to circulation, Will make coin disappear altogether, 584 How light shillings are bought by weight, —— Consequences as to the circulation with merchants and 585 bankers, That guineas would still pass current for 21 shillings, —— That the standard would be affixed to the light silver, —— as it was in the year 1695, That merchants would gain by it, 586 Debtors would be ruined, —— Consequences as to the bank, —— Reducing guineas to 20 shillings is the same as making 587 them a commodity,

CHAP. XI. Method of restoring the money-unit to the standard —— of Elizabeth, and the consequences of that revolution, How to fix the pound sterling at the standard of Queen —— Elizabeth, The consequences of this reformation will be to raise 588 the standard _5 per cent._ Every interest in a nation equally intitled to 589 protection, Those who suffer by the debasement of the standard, —— Ought only to benefit by the restitution, 590 And not the whole class of creditors, —— Whose claim ought to be liable to a conversion, 591 According to justice and impartiality, ——

CHAP. XII. _Objections_ stated against the principles laid 592 down in this inquiry, and answers to _them_, That a pound will always be considered as a pound, 593 That the standard is not debased at present, being —— fixed to the statute, not to the coin, That the pound sterling is virtually worth 1718.7 —— grains fine silver, That these principles imply a progressive debasement of 594 the standard every new coinage, That the same argument holds for debasing the standard —— measures of weights, capacity, &c. That the wearing of the coin falls on them who possess —— it at the crying down, but does not debase the standard, That inland dealings, not the price of bullion, or —— course of exchange, regulate the standard, That public currency supports the value of the coin, —— That this scheme is the same with that of Lowndes, —— Answers to these objections, 595 That a pound will be considered at its worth by all —— debtors, and by those who buy, If the standard was affixed to the statute, people —— would be obliged to pay by weight, No body can be obliged to pay 1718.7 grains fine silver 596 for a pound sterling, That it is not the regulation of the mint, but the —— disorder of the coin which must debase the standard, That people are obliged to measure by the standard 597 weight, but are not obliged to pay by the standard pound, That the loss upon light money when called in, does not —— fall upon the possessors, That inland dealings cannot support the standard where 599 there are money-jobbers or foreign commerce, That public currency supports the authority of the 601 coin, not the value of the pound sterling, That the scheme is similar, though not the same with 602 that of Lowndes, Lowndes reasoned upon wrong principles, —— Locke attended to supporting the standard, without —— attending to the consequences, Political circumstances are greatly changed, 604 Reconciliation of the two opinions, 606 The question in dispute is not understood, 607 The true characteristic of a change upon the standard —— is not attended to, Principles will not operate their effects without the 608 assistance of the state, When people understand one another, they soon agree, —— Permanent contracts are confounded with sale in the 609 dispute, The interest of creditors is always the predominant, 611 and determines the opinion of a nation, Application of principles to the operation the Dutch 612 have lately made upon their coin, All decisions in political questions depend upon 613 circumstances,

CHAP. XIII. In what sense the standard may be said to have 614 been debased by law; and in what sense it may be said to have suffered a gradual debasement by the operation of political causes, These proportions appear contradictory, —— Debased by law, when affixed to the gold, 615 Effects which the changing the proportion of the metals —— has upon melting the coin, and regulating payments, Payments made by bankers regulate all others, —— The standard gradually debased by the rising of the 616 silver, The proportion of the metals in 1728, supposed to have —— been as 15.21 is to 1., By what progression the silver standard has been —— debased, The standard of Elizabeth, for the pound sterling, was 617 1718.7 grains silver, and 157.6 ditto gold, both fine, The gold standard of her pound worth, at present, —— 2285.5 grains fine silver, The variation of the metals has produced three —— different standards of Elizabeth, One worth £ 1 0 11⅜ present currency, 618 Another worth £ 1 7 10⅞ ditto, —— And a third worth £ 1 4 5⅛ ditto, —— The last is the true standard of Elizabeth for the —— pound sterling, and worth at present 2002 grains fine silver, and 138 ditto gold, But may vary at every moment, 619 Gold rose during the whole 17th century, —— And silver has risen since the beginning of this —— century, Some positions recapitulated, 620

CHAP. XIV. Circumstances to be attended to in a new 621 regulation of the British coin, The adopting of the standard of Elizabeth, has an air —— of justice, Advantages of that of Mary I., —— Conversions necessary in every case, 622 Every interest within the state to be examined, —— Landed interest examined, —— Interest of the public creditors examined, 625 Interest of trade examined, 628 Interest of buyers and sellers examined, —— Interest of the bank examined, 629 Inconveniences attending all innovations, 632 Argument for preserving the standard at the present —— value, That every change must either hurt the bank, or the —— public creditors, A more easy method of making a change upon the 633 standard,

CHAP. XV. Regulations which the principles of this inquiry 634 point out as expedient to be made, by a new statute for regulating the British coin, 1. Regulation as to the standard, —— 2. As to the weight, —— 3. Mint price, —— 4. Denominations, 635 5. Marking the weight on the coins, —— 6. Liberty to stipulate payment in gold or silver, —— 7. Creditors may demand payment, half in gold, and half —— in silver, 8. Regulations as to sale, —— 9. Ditto as to payments to and from banks, &c., —— 10. All coin to be of full weight, when paid away, —— 11. Liberty to melt or export coin, but death to clip —— or wash, 12. Rule for changing the mint price of the metals, 636 13. When to change the mint price, —— 14. Rule for changing the denomination of the coins, —— 15. How contracts are to be acquitted, after a change —— of the denomination has taken place, 16. The weight of the several coins never to be 638 changed, except upon a general recoinage of one denomination at least, How these regulations will preserve the same value to —— the pound sterling at all times, and how fractions in the denomination of coin may be avoided, 17. Small coins to be current only for 20 years, and 639 large coins for 40 years, or more, 18. All foreign coins to pass for bullion only, —— Consequences of these regulations, ——

AN INQUIRY INTO THE PRINCIPLES OF POLITICAL OECONOMY.