Financial and Monetary Policy Studies Peter Bernholz Roland Vaubel Editors Explaining Monetary and Financial Innovation A Historical Analysis Financial and Monetary Policy Studies Volume 39 Series editor Ansgar Belke, Essen, Germany For further volumes: http://www.springer.com/series/5982 Peter Bernholz · Roland Vaubel Editors Explaining Monetary and Financial Innovation A Historical Analysis 1 3 Editors Peter Bernholz Roland Vaubel Center for Economics and University of Mannheim Business (WWZ) Mannheim University of Basel Germany Basel Switzerland ISSN 0921-8580 ISSN 2197-1889 (electronic) ISBN 978-3-319-06108-5 ISBN 978-3-319-06109-2 (eBook) DOI 10.1007/978-3-319-06109-2 Springer Cham Heidelberg New York Dordrecht London Library of Congress Control Number: 2014937280 © Springer International Publishing Switzerland 2014 This work is subject to copyright. 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Printed on acid-free paper Springer is part of Springer Science+Business Media (www.springer.com) Contents The Political Economy of Monetary and Financial Innovation: Introduction and Overview ...................................... 1 Peter Bernholz and Roland Vaubel Silver as a Financial Tool in Ancient Egypt and Mesopotamia. . . . . . . . . . 17 Marc Van De Mieroop War and Peace, Imitation and Innovation, Backwardness and Development: The Beginnings of Coinage in Ancient Greece and Lydia .............................................. 31 David M. Schaps The Emergence and Spread of Coins in Ancient India ................ 53 Deme Raja Reddy The Emergence and Spread of Coins in China from the Spring and Autumn Period to the Warring States Period .................... 79 Yohei Kakinuma The Changing Pattern of Achaemenid Persian Royal Coinage ......... 127 Christopher Tuplin The Spread of Coins in the Hellenistic World ....................... 169 Andrew Meadows Monetary Innovation in Ancient Rome: The Republic and Its Legacy ... 197 Bernhard E. Woytek The Provision of Stable Moneys by Florence and Venice, and North Italian Financial Innovations in the Renaissance Period ..... 227 Peter Spufford v vi Contents Monetary and Financial Innovations in Flanders, Antwerp, London and Hamburg: Fifteenth to Eighteenth Century .............. 253 Markus A. Denzel The Bank of Amsterdam Through the Lens of Monetary Competition ................................................... 283 Stephen Quinn and William Roberds Monetary and Financial Innovation in the Spanish Empire: Lights and Shadows ............................................ 301 Carlos Alvarez-Nogal The Emergence and Innovations of the Eurodollar Money and Bond Market: The Role of Openness and Competition Between States ................................................. 323 Torsten Saadma and Roland Vaubel Editor Biography Carlos Álvarez-Nogal Ph.D. (Universidad de Valladolid) is Associate Professor of Economic History and Institutions and Research Fellow of the Figuerola Institute at Universidad Carlos III de Madrid. He has been a Visiting Professor at Paris School of Economics, Stanford University (Social Science History Institute) and Visiting Fellow at Universitá degli Studi di Genova. He has published Los banqueros de Felipe IV y los metales preciosos americanos, (1621–1665) (1997) and other books; with Leandro Prados de la Escosura: The Rise and Fall of Spain (1270–1850) (Economic History Review 2013), and The Decline of Spain (1500–1850): conjec- tural estimates (European Review of Economic History 2007), and with Christophe Chamley Debt Policy under Constraints between Philip II, the Cortes and Genoese bankers (Economic History Review 2014). Peter Bernholz is retired Professor of Economics at Universität Basel, Switzerland. He was educated at Marburg and Munich Universities. His main efi lds of research are Austrian Real Capital Theory; Public Choice; Monetary Theory, Policy and History. Rockefeller Fellow 1963/1964 at Harvard and Stanford Universities. Guest professor at Massachusetts Institute of Technology, Virginia Polytechnic Institute, Institute for Advanced Studies, Vienna, Stanford University, University of C alifornia Los Angeles, Australian National University, Canberra, University of California Irvine, Universita degli Studi di Roma “La Sapienza”, and Universität Innsbruck. Corresponding Member of the Bavarian Academy of Sciences. Dr. h. c. of Universitaet Konstanz and Universitaet Freiburg. Co-Founder of the European Public Choice Society and her President from 1974 to 1981; Member of Wissenschaftlicher Beirat (Academic Advisory Council) of the German Federal Ministry of Economics since 1974. Markus A. Denzel is Professor of Social and Economic History at Universität Leipzig, Germany. His research focusses on late medieval and early modern econom- ic history, especially monetary history. He is the author of the books Das System des bargeldlosen Zahlungsverkehrs europäischer Prägung vom Mittelalter bis 1914 (2008), Die Bozner Messen und ihr Zahlungsverkehr, 1633–1850 (2005) and La Practica della Cambiatura. Europäischer Zahlungsverkehr vom 14. bis zum 17. Jahrhundert (1994). vii viii Editor Biography Yohei Kakinuma is a Lecturer at the Department of History, Faculty of Liberal Arts, Teikyo University, Japan. His doctorate is from Waseda University, and he was Assistant Professor at Waseda University. His fields of study include Chinese his- tory, ancient, and medieval Chinese economic history. He is the author of the book Chu¯goku Kodai Kahei Keizaishi Kenkyu¯ (A History of Ancient Chinese Monetary Economy) (2011). He has also published, Gokan Jidai ni okeru Kahei Keizai no - - Tenkai to Sono Tokushitsu (2009), Shindai Kahei Keizai no Kozo to Sono Tokushitsu - (2010), Sangoku Jidai no Sogi ni okeru Zeisei Kaikaku to Kahei Keizai no Shitsuteki - - Henka (2010), Shu˘ hàn de Ju¯nshì Zuìyouxia¯nxíng Jıngjì Tˇıxì (2012) etc. Andrew Meadows holds degrees from the University of Oxford and Michigan. He has been Curator of Greek Coins at the British Museum, a member of the Institute for Advanced Study in Princeton and in 2008 was appointed Deputy Director of the American Numismatic Society in New York. In 2012, he was elected to the Kraay Visitorship and a Robinson Scholarship at the University of Oxford. He has written and edited more than 90 books and articles, including three volumes of the Sylloge Nummorum Graecorum and Coin Hoards IX and X, and is Series Editor of the joint ANS-Cambridge University Press Guides to the Coinage of the Ancient World and editor of the American Journal of Numismatics. He teaches Greek and Roman numismatics for Columbia University in New York. Stephen Quinn is an Associate Professor of Economics at Texas Christian University. He has been at TCU since he nfi ished his Ph.D. at the University of Illinois at Urbana- Champaign. His scholarship focuses on money and banking in Early Modern England and Netherlands. With William Roberds, he has published The Bank of Amsterdam and the Leap to Central Bank Money (American Economic Review Papers and Proceed- ings) and An Economic Explanation of the Early Bank of Amsterdam in The Origin and Development of Financial Markets and Institutions. Deme Raja Reddy is a neurosurgeon and a numismatist. After medical graduation from Gandhi medical college in Hyderabad, India, he took neurosurgical training in U.K., U.S.A., and Australia. He has obtained a fellowship of the Royal College of Surgeons of Edinburgh and Royal Australasian College of Surgeons. Neurosurgi- cal practice, teaching, and training of neurosurgeons led to his appointment as the Director of the Nizam’s Institute of Medical Sciences in Hyderabad and now con- tinues there as its Emeritus professor. He was invited as a visiting professor to four universities in U.S.A. Reddy took interest in numismatics as a hobby in the 1980s which has now become a serious avocation. His scientific approach to the study of coins led to publication of large numbers of papers on Deccan coinage of ancient India. He was elected as the president of the “South Indian Numismatic Society” of Chennai and the editor of its journal “Studies in South Indian Coins”. The study of Singavaram coinage dating back to the sixth–seventh century BC helped in under- standing the origin of coinage in India and its spread through the Indian subconti- nent. The articles and books relevant to the present paper in this volume are: Andhra “janapada” coins from Singavaram, the uninscribed coins from Andhra, Kotalingala coins, and the Pre-Satavahana coinage of Andhra. Editor Biography ix William Roberds is a Research Economist and Senior Policy Advisor with the Federal Reserve Bank of Atlanta. Dr. Roberds joined the bank in July 1987. Previ- ously he was an Assistant Professor at Brown University (1982–1984) and an econ- omist at the Federal Reserve Bank of Minneapolis (1984–1987). He holds a Ph.D. in Economics from Carnegie-Mellon University. Dr. Roberds’ fields of specialization is the economics of money and payments. With Stephen Quinn, he has authored a number of papers on the Bank of Amsterdam. These include The Bank of Amster- dam and the Leap to Central Bank Money (American Economic Review Papers and Proceedings) and An Economic Explanation of the Early Bank of Amsterdam in The Origin and Development of Financial Markets, and Institutions. Torsten Saadma received his Master’s in Economics (Diplom-Volkswirt) from the University of Mannheim. While serving at the same institution as a lecturer (wissenschaftlicher Mitarbeiter) he focused his research on international banking and the European Monetary Union. David M. Schaps is Professor of Classical Studies at Bar-Ilan University in Ramat- Gan, Israel. He is the author of Economic Rights of Women in Ancient Greece, The Invention of Coinage and the Monetization of Ancient Greece, Handbook for Classi- cal Research, and numerous articles in various areas of classics and ancient history. Peter Spufford Fellow of the British Academy. B.A., M.A., Ph.D., Litt.D., University of Cambridge. Emeritus Professor of European History, University of Cambridge, since 2001, Fellow, Queens’ College, Cambridge, since 1979. Hand- book of Medieval Exchange (1986), Money and Its Use in Medieval Europe (1988), Power and Profit: The Merchant in Medieval Europe (2002), From Antwerp to Lon- don. The Decline of Financial Centres in Europe (2005), The First Century of the Florentine Florin (Rivista Italiana di Numismatica, cvii, 2006), How Rarely Did Medieval Merchants Use Coin? (2008). Christopher Tuplin was educated in Oxford but for the last 37 years has worked at the University of Liverpool, where he is now Professor of Ancient History. He is the author of Failings of Empire (1993) and Achaemenid Studies (1996), editor of Pontus and the Outside World (2004), Xenophon and his World (2004) and Per- sian Responses: Cultural interaction (with) in the Achaemenid Empire (2007), and co-editor (with T. E. Rihll) of Science and Mathematics in Ancient Greek Culture (2002) and (with F. E. Hobden) of Xenophon: Ethical Principles and Historical Enquiry (2012). He has also published numerous research papers, chiefly on classi- cal Greek history, Xenophon, and the Achaemenid Empire. He is currently working on Greek mercenaries, seal-stone images of Persian military combat, and the cor- respondence of Arshama, Persian satrap of Egypt in the later fifth century BC. Marc Van De Mieroop is Professor of History at Columbia University. He has also taught at the University of Oxford and at Yale University. He is the author of numer- ous articles and books on various aspects of the history of the ancient Near East. These include Society and Enterprise in Old Babylonian Ur, The Ancient Mesopota- mian City, A History of the Ancient Near East, A History of Ancient Egypt, and The Eastern Mediterranean in the Age of Rameses II. x Editor Biography Roland Vaubel is Professor of Economics at Universität Mannheim, Germany. He received a B.A. in Philosophy, Politics, and Economics from the University of Oxford, an M.A. in Economics from Columbia University, New York and a doctorate from Universität Kiel. He has been Professor of Economics at Erasmus Universiteit Rotterdam and Visiting Professor in International Economics at the Graduate School of Business, University of Chicago. He is author of Strategies for Currency Unification, the Economics of Currency Competition and the Case for a European Parallel Currency, and associate editor of the Review of Interna- tional Organizations (Springer) and a member of the Academic Advisory Council of the German Federal Ministry of Economics. Bernhard E. Woytek is head of the division “Documenta Antiqua”—responsible for research in epigraphy, numismatics, papyrology, and the history of ancient law— at the Institute for the Study of Ancient Culture, Austrian Academy of Sciences, Vienna. He also teaches numismatics and monetary history at the University of Vienna. Woytek studied ancient history and numismatics in Vienna and was “Visiting Scholar in Residence” at the American Numismatic Society (New York) in 2010. In the academic year 2010/2011, he was a research fellow at the University of Cambridge (UK). Woytek specializes in the coinage and nfi ances of the Roman world as well as in the history of classical scholarship. His publications include Arma et nummi. Forschungen zur römischen Finanzgeschichte und Münzprägung der Jahre 49–42 v. Chr. (2003) and Die Reichsprägung des Kaisers Traianus (98-117). Moneta Imperii Romani 14 (2010).