A Multi-Layer System and Its Features: Reconceptualizing the Monetary Regime of Late Qing and Modern China

Hongzhong Yan (), Zhijian Qiao and Chen Xu
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Hongzhong Yan: School of Economics, Shanghai University of Finance and Economics, Shanghai 200433, China
Zhijian Qiao: Department of History, Amherst College, Amherst, MA 01002, USA
Chen Xu: School of Economics, Minzu University of China, Beijing 100081, China

Frontiers of Economics in China-Selected Publications from Chinese Universities, 2018, vol. 13, issue 3, 436-457

Abstract: This essay aims to reconceptualize the monetary regime of late Qing and modern China as a multilayer system of currencies and examine the features and logics of its operation from the 16th century to early 20th century. We argue that this system consists of a variety of silver and copper currencies, each occupying a particular layer in the structure and each satisfying a specific market demand. Analyzing the production and circulation of copper and silver currencies, we first trace their evolution from the Qing to the Republican era and demonstrate the multi-layer currency structure persisted in China across the modernizing changes that took place at the end of the 19th century. Second, using data drawn from gazetteers, this essay adopts a quantitative approach to empirically examine the mechanism and speed of interactions between the different layers of the monetary market and reveal the operational mechanism of the multi-layer system. We suggest that this multi-layer system, while bringing some efficiency loss, also constituted an effective institutional arrangement that helped to ensure the stability of the Chinese economy in tumultuous times.

Keywords: late Qing China; modern China; monetary system; market hierarchy; exchange rate; silver coins; copper dollars (search for similar items in EconPapers)
JEL-codes: B15 B41 E42 (search for similar items in EconPapers)
Date: 2018
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