Goldilocks: American precious metals and the Rise of the West

Yao Chen, Nuno Palma and Felix Ward

No 17919, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We estimate the contribution of the American precious metal windfall to West Europe’s growth performance in the early modern period. The exogenous nature of American precious metal extraction allows for the identification of monetary effects. We find that American precious metals fostered West Europe’s growth by stimulating trade and capital accumulation. Our findings place West Europe’s second-stage receivers in a particularly fortunate goldilocks zone that enjoyed monetary stimulus, while being insulated against the transport-loss induced financial crises that caused persistent damage to first-stage receiver Spain.

Keywords: market; integration (search for similar items in EconPapers)
JEL-codes: E51 F40 N10 (search for similar items in EconPapers)
Date: 2023-02
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Journal Article: Goldilocks: American Precious Metals and the Rise of the West (2026)
Working Paper: Goldilocks: American precious metals and the Rise of the West (2026)
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