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The Debasement Puzzle: an Essay on Medieval Monetary History (1997) [pdf]

20 pointsby jpelecanosover 6 years ago

3 comments

empath75over 6 years ago
The debtor explanation seems like it would be fine to me because it seems like lenders would not be likely to want to renogotiate their loans every time the money is debased, nor would most debtors have the leverage to demand it. Seems like it would be much easier to just get new coins.
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RobertoGover 6 years ago
&quot;[..] come to a counter at the mint and deliver their metal[..], and they would be paid back, within a few weeks, in newly minted coins of the same metal they brought in. They always received back less fine metal than they brought in.&quot;<p>If the quantity of metal was the origin of the value and they weighted the coin when using it, why they need the mint in the first place? why not to use the metal directly?
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cbkellerover 6 years ago
&gt; <i>In our opinion, the facts we have presented suggest that existing models of commodity money, which assume well-informed agents, are not capable of successfully confronting the facts we present. A potentially fruitful line of research may be to weaken the full-information assumption</i><p>So, the solution to the puzzle is just that humans aren&#x27;t actually all rational and well-informed?