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The monetary systems of the Han and Roman empires

The monetary systems of the Han and Roman empires

Walter Scheidel

Princeton/Stanford Working Papers in Classics, February (2008)

Abstract

The Chinese tradition of supplementing large quantities of bronze cash with unminted gold and silver represents a rare exception to the western model of precious-metal coinage. This paper provides a detailed discussion of monetary development in ancient China followed by a brief survey of conditions in the Roman empire. The divergent development of the monetary systems of the Han and Roman empires is analyzed with reference to key variables such as the metal supply, military incentives, and cultural preferences. This paper also explores the “metallistic” and “chartalistic” elements of the Han and Roman currency systems and estimates the degree of monetization of both economies.



Beginning in the third century BCE, the imperial unification of both East Asia and the Mediterranean gave rise to increasingly standardized currency systems that sought to establish stable means of payment. In both cases, the eventual monopolization of minting tied the success of these currencies to the fortunes of the state. Yet despite these basic similarities, substantial differences prevailed. While silver and later gold dominated the monetary economy of the Roman empire, the victorious Chinese regimes operated a system of bronze coinages supplemented by uncoined precious-metal bullion. This raises a series of questions. How did these differences arise, and why did they persist well beyond antiquity? How did the use of different metals affect the relationship between the nominal and intrinsic value of monetary objects? Did the minting of precious metals in the West and China’s reliance on copper determine overall levels of monetization? To the best of my knowledge, none of these issues has ever been addressed from a comparative perspective. The failure to do so has made it harder to appreciate the specific properties of each of these two monetary systems. Explicit comparison brings the constituent elements of each tradition into sharper relief: by defamiliarizing the familiar, it invites us to question established interpretations and reconsider the nature of putative causal relationships.

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