Levy Economics Institute Presents
Why Fiat Copper Money Collapsed: Evidence of Trust in Early Modern Europe
Wednesday, March 6, 2024
Blithewood
5:00 pm – 6:00 pm EST/GMT-5
5:00 pm – 6:00 pm EST/GMT-5
The Levy Economics Institute Presents a Guest Lecture Featuring Danila Raskov from the Helsinki Collegium for Advanced Studies at the University of Helsinki, Finland
Abstract:The talk addresses two questions: Why did fiat copper money operations fail? And what is the reason behind the short-term success of these operations? I argue that, in both cases, trust as a habit and sovereigns' competition provide a more plausible explanation than the risk of default, the supply of money, or the scarcity of real resources. The issuance of copper currency at enforced exchange rates as the monetary campaign of Tsar Alexei Mikhailovich of Russia (1654–1663) is worth investigating. The prevailing literature highlighted the fiasco accompanied by agio and hyperinflation. A better understanding of these initiatives can be achieved through a framework of trust, as expounded by Aglietta and Orléan. Trust, in this context, operates on three levels: as societal norms and conventions, as public trust in governing authorities, and as an interplay among sovereigns (including counterfeiters). This framework reveals that inflation correlates with a decline in trust, challenging the efficacy of both the State Theory of Money and monetarism.
For more information, call 845-758-7710.
Time: 5:00 pm – 6:00 pm EST/GMT-5
Location: Blithewood