NEW APPRECIATIONS IN HISTORY 4 Published by The Historical Association Currency and the Economy in Tudor and early Stuart England by C. E. Challis NEW APPRECIATIONS IN ^ HISTORY 4 XT Currency and the Economy in Tudor and early Stuart England by C. E. Challis The Historical Association 59a Kennington Park Road, London SE11 4JH Acknowledgements \s I wish to thank Emeritus Professor A. J. Brown and Or A. R. Bridbury for their stimulating and helpful comments on the draft of this pamphlet. The Trial Plates of 1560 are published by kind permission of the Deputy Master of the Royal Mint. The coins and tokens are published by kind permission of the Curator of the Leeds University Coin and Medal Collection. Introduction, Page 5 This pamphlet has been edited by Gareth Elwyn Jones Mint Output and the Supply of Bullion, Page 7 The Historical Association, founded in 1906, brings together people who share an interest in, and love for, the past. It aims to further the study and teaching of history at all levels: teacher and student, amateur and professional. This is one of The Circulating Medium, Page 14 over 100 publications available at very preferential rates to members. Membership also includes journals at generous discounts and gives access to courses, conferences, tours and regional and local activities. Full details are Offsetting, Barter and Payments in Kind, available from The Secretary, The Historical Association, 59a Kennington Park Page 18 Road, London SE11 4JH, telephone: 01-735 3901 The publication of a pamphlet by the Historical Association does not necessarily Petty Credit and Tokens, Page 21 imply the Association's approval of the opinions expressed in it. © C. E. Challis, 1989. Conclusion, Page 26 ISBN 0 85278 307 8 Printed Works Cited in the Text, Page 31 Originated and published by The Historical Association, 59a Kennington Park Road, London SE11 4JH and printed in Great Britain by The Chameleon Press Limited, 5-25 Burr Road, London SW18 4SG The front cover illustration is a groat of I lenry VII ( 14H5-1509) L Figure 1. Trial Plates by which the Gold and Silver coins ordered in 1560 were tested. Currency and the Economy in Tudor and early Stuart England Then, as now, it was a royal Introduction monopoly.1 Before the development of paper money, which in England did not really Unlike many European states at that occur until the later seventeenth time, England had no official coins in century, the circulating medium copper or billon (a copper/silver alloy consisted of coins and tokens. The unit in which copper predominated), which of account in which they were valued meant that coins were either of gold or was the pound sterling, in which there of silver. In each case the face value of were twenty shillings each of twelve a coin was determined by, first, the pence, making 240 pennies in all. In weight of the metal it contained; value terms, coins were unquestionably second, the fineness (or purity) of that more important than tokens and, metal; and, third, the cost of coinage, although from time to time coins were by which is meant not only the cost of imported, the overwhelming number actual manufacture but also the profit throughout the Tudor and early Stuart offered to suppliers to induce them to period were produced at home. The bring bullion in. Thus, in 1560, 1 Ib. of ending of the franchises in the later silver coin had a face value of 60s. but years of Henry VlII's reign, whereby contained only 55s.6d. worth of pure the bishop of Durham and the silver. Since the mint charged ls.6d. archbishops of Canterbury and York for manufacture, the supplier gained had minted small quantities of silver 3s., or 5 per cent of the face value of under royal licence, was followed by a his new coins. This third factor, though brief period in which some minting small in comparison with the other occurred in the provinces under direct two, was of vital importance because it royal control, and there was a ensured that the value which weight subsequent, if minor, resurgence of and fineness gave to a coin (its provincial minting following intrinsic value) was always less than parliament's seizure of the Tower mint the face value assigned to the coin by in 1642. In general, however, minting government. Consequently, the coin, in England was synonymous with being more valuable as coin than as output at the Tower mint, London. bullion, stayed in circulation. Whenever this relationship was effective, alloy in circulation. In view Table 1. Value in £s of English Coin Output, J460-1660 reversed, by the cost of bullion rising of this, it seems more profitable to see and causing the intrinsic value of coins the introduction of a new standard in to exceed their face value, remedial 1526 not as an abandonment of the (1) (2) (3) (4) (5) ((>) (7) Cold Silver Total Gold as % Annual Index action was essential if the money traditional policy of avoiding Total Average 1485-1526 supply was to be maintained and took depreciation through a reduction in £ £ .£ = 100 the form either of raising the face fineness, but of the recognition of the value of existing coins sufficiently high superior merits of an alternative alloy. 1460-1485 762,106 1,041,861 41,674 to make their face value once again 279,755 73 103 1485-1526 1,271,986 394,954 1,666,940 40,657 100 higher than their intrinsic value — a Commonly, depreciation is quite 76 1526-1544 360,244 603,381 963,625 53,534 132 process normally referred to as mistakenly described as debasement, a 37 1544-1551 1,314,188 2,724,479 4,038,667 576,952 1419 enhancement — or of reducing the phenomenon for which the years 33 1551-1560 88,201 228,500 316,701 28 35,189 87 quantity of metal in a coin. 1542-51 were especially notorious. As we have seen, in normal circumstances 1560-1603 769,502 4,594,128 5,363,630 14 124,736 307 1603-1625 4,346,022 1,642,857 5,988,879 73 272,221 670 In respect of this process two points a coin's face value equalled its intrinsic value plus the charge made for coinage 1625-1649 3,212,081 8,673,858 1 1 ,885,939 27 495,247 1218 are worth particular emphasis. First, 1649-1660 97,448 751,954 849,402 12 77,218 190 regardless of which technique was and it is obvious that when depreciation occurred this relationship used to restore the correct relationship Totals 12,221,778 19,893,866 32,115,644 38 160,578 between intrinsic and face values, the was not disturbed. It could hardly have result was always the same: a coin of a been otherwise, given that given denomination contained less depreciation was a mechanism Source: Challis, A New History of the Royal Mint, Chapter 3. precious metal than previously, and the deliberately employed to keep the coinage as a whole depreciated in equation in balance. When debasement alterations in the English currency and notably of various gaps in the evidence value. Second, in England it was quite was being practised, however, this the fortunes not only of the exchange for the Tower and of the breakdown in exceptional for depreciation to be equation was extended to include a rate but also of overseas trade is an the practice of making up the mint achieved by altering the fineness of large profit for the Crown which was important area of study, it lies beyond accounts on a regular basis, using the coins. Time out of mind the standard obtained by reducing the weight the scope of the following discussion same annual accounting period, which of English silver coin, 'sterling' in and/or the fineness of the precious which is entirely devoted to the means that, even for the Tower, there contemporary parlance, had been fixed metal content of a coin, through the domestic circulating medium. We shall are difficulties in presenting a uniform at 11 ounces 2 pennyweights, or 925 substitution of copper, without this look, first, at the expansion of the set of figures. Nevertheless, it remains parts in a thousand pure metal, and reduction being reflected in the coin's coined money supply and the more true that the principal details of gold at 23 carats 3'/2 grains, or 994.8 face value. By this means the mint's obvious factors which determined this; English mint output are here set out parts in a thousand. Being high and output became fiat money, in which then at the relationship between that with some accuracy and we may feel dependable, these standards ensured face value was determined not by supply and what appears to have been confident, especially when these details that English coin had a remarkably precious metal content but by the transactions demand for money; are aggregated together over good reputation, not least abroad. government edict, and was thus open and, finally, at forces which tugged in reasonable periods of time, that they Leaving on one side the wholly to doubt wherever and whenever that opposite directions, on the one hand may be taken as a trustworthy basis for edict could not be enforced. This was exceptional circumstances of the increasing the demand for money and further analysis.2 1540s and 1550s which arose from the particularly obvious when English coin on the other greatly economising in its fiscal exploitation of the coinage, the travelled abroad and circulated quite use.