Role Of Precious Metals In European Economic Development, Vol. 192

Tracing the monetary history of Europe, this study explores the impact of change in the availability and use of bullion, in the form of money, on the economic evolution of Europe. The Romans fostered economic prosperity through the accumulation of bullion and circulation of accredited currency. Over time, shortages of species rendered the Roman coinage worthless. As a result, commercial activities contracted, causing the breakdown of the Roman economic and political systems. Lack of liquidity in the early Middle Ages limited commercial activities, and promoted conditions sustaining dependency on land, thereby enabling feudalism to flourish. In the late 10th century, discovery of rich silver mines in Central Europe increased the circulation of coinage, promoting trade and demographic urbanization. The augmentation of silver resources continued to boost economic prosperity during the 12th and 13th centuries.

In the 14th century, decrease in mine output induced severe scarcity of bullion. Lack of currency caused the contraction of economic activities, leading to food shortages, famines, depopulation, and the eventual breakdown of the feudal economic order. Continuous shortage of bullion in the 15th century forced the reintroduction of barter trade and limited commercial activities. Scarcity of precious metals induced the Portuguese to venture into Africa. African gold provided them with the incentive and capital for expeditions of discovery to the East, but the lack of sufficient bullion prevented them from monopolizing the eastern trade. In the 16th century the influx of species from the mines of central Europe and America ended the European bullion famine and gave rise to economic prosperity.

Tracing the monetary history of Europe, this study explores the impact of change in the availability and use of bullion, in the form of money, on the economic evolution of Europe. The Romans fostered economic prosperity through the accumulation of bullion and circulation of accredited currency. Over time, shortages of species rendered the Roman coinage worthless. As a result, commercial activities contracted, causing the breakdown of the Roman economic and political systems. Lack of liquidity in the early Middle Ages limited commercial activities, and promoted conditions sustaining dependency on land, thereby enabling feudalism to flourish. In the late 10th century, discovery of rich silver mines in Central Europe increased the circulation of coinage, promoting trade and demographic urbanization. The augmentation of silver resources continued to boost economic prosperity during the 12th and 13th centuries.

In the 14th century, decrease in mine output induced severe scarcity of bullion. Lack of currency caused the contraction of economic activities, leading to food shortages, famines, depopulation, and the eventual breakdown of the feudal economic order. Continuous shortage of bullion in the 15th century forced the reintroduction of barter trade and limited commercial activities. Scarcity of precious metals induced the Portuguese to venture into Africa. African gold provided them with the incentive and capital for expeditions of discovery to the East, but the lack of sufficient bullion prevented them from monopolizing the eastern trade. In the 16th century the influx of species from the mines of central Europe and America ended the European bullion famine and gave rise to economic prosperity.

Booknews

Evaluates the role of money (in the form of precious metals) and its availability and use on the economic development of Europe. Placing an emphasis on the Roman Empire and the Middle ages the author argues that the availability of a sound currency is central to economic progress. He examines the impact of money on the political, social, and demographic evolution of pre-capitalist Europe, as well as its relevance to international commerce, overseas exploration, and European economic development. Annotation c. by Book News, Inc., Portland, Or.

S.M.H. BOZORGNIA received his Ph.D. from Arizona State University and is currently employed by the Caspian Trading Company.