The Law of Copernicus in Poland, from early 16th century to late 18th century

Paweł Kowalewski (), Stephen Quinn () and William Roberds ()
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Paweł Kowalewski: Narodowy Bank Polski
Stephen Quinn: Texas Christian Univers
William Roberds: Federal Reserve Bank of Atlanta (emeritus)

Bank i Kredyt, 2025, vol. 56, issue 2, 139-162

Abstract: The law according to which bad money drives out good money was coined by Nicolaus Copernicus around 1518. His contributions to economic thought went beyond this law to deal with issues related to debasement. It was a bizarre coincidence that approximately 200 years after Copernicus’ death his native land was the setting for his theories to be turned into practice on a massive scale. This coincidence was a side effect of economic processes that began with the discovery of silver in the Spanish American Empire. As a result of all this silver, and later gold, Central and Eastern Europe struggled to control its money and made little progress in constructing a modern state. In particular, the Polish- -Lithuanian Commonwealth was the key target for unethical monetary policies pursued by Frederick the Great during the Seven Years War (1756–1763). The Prussian state sponsored counterfeiting, which aggressively debased the Commonwealth’s coins and amplified all the negative effects stemming from Copernicus’ law. Action undertaken by the Prussian king made the economic division of Europe into the wealthy west and the poor east even stronger. And it was not until the turn of the last and current centuries, when this gap slowly started to reverse.

Keywords: debasement; coinage; seigniorage; gold (silver); mint (search for similar items in EconPapers)
JEL-codes: N13 N23 N33 N43 N53 (search for similar items in EconPapers)
Date: 2025
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