Competing Bimetallic Ratios: Amsterdam, London and Bullion Arbitrage in the Mid-18th Century

Pilar Nogues-Marco

No 9300, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: This article analyzes the stability of bimetallism for countries operating in integrated bullion markets who enact different legal ratios. I articulate a new theoretical framework to demonstrate that two countries can both be bimetallic only if they coordinate their legal ratios. The theoretical framework is applied to the mid-18th century when London?s legal ratio was 3.8% higher than that of Amsterdam. I find that Amsterdam was effectively on the bimetallic standard, whereas London was on a de facto gold standard.

Keywords: Bimetallic stability; Bullion market integration; Arbitrage; Monetary policy; Specie-point mechanism; Melting-minting points (search for similar items in EconPapers)
JEL-codes: E42 F15 N13 N23 (search for similar items in EconPapers)
Date: 2013-01
New Economics Papers: this item is included in nep-his and nep-mac
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Citations: View citations in EconPapers (14)

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Related works:
Journal Article: Competing Bimetallic Ratios: Amsterdam, London, and Bullion Arbitrage in Mid-Eighteenth Century (2013)
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