GOLD. 595 



I cannot agree with the opinion expressed by some econo- 

 mists, that the market value of gold will always be relative to 

 its demand in the arts, unless indeed the term be extended so 

 as to include the art of the moneyer. The price of gold must 

 be relative to the aggregate of all demands for it, corrected by 

 the cost of producing it. Now it cannot be doubted that equal 

 quantities of gold are not always obtained at equal cost, but 

 that since, as a rule, gold is found at first superficially and 

 afterwards by a laborious mechanical process, operations of 

 the latter kind are undertaken because the cost of production 

 is compensated by the demand for the product. Were gold to 

 be in demand for the arts only, and by some economical 

 revolution did it cease to have any use as a medium of ex- 

 change, either by actual transfer or as deposited in pledge of a 

 convertible paper currency, it would certainly follow that exist- 

 ing stocks would be greatly depreciated, and that gold minings 

 would be carried on only where the supply was abundant and 

 the produce easily gathered, lighter labour being given in 

 anticipation of lower prices. If, indeed, the demand created 

 by the arts were so great as to absorb all that was produced, 

 and were sufficient to stimulate all the labour now engaged in 

 the cost of production, the price would not fall ; but it seems 

 certain that the amount of gold thus employed is but a very 

 small fraction of the annual produce. 



Now it appears from Muratori, Antiqq. Med. >*Evi, vol. vi. 

 dissert. 28, that at or about the conclusion of the thirteenth 

 century gold currencies became general in Italy. The Venetians, 

 we are informed (Sanuto, Hist. Venet. vol. xxii.), coined gold 

 ducats (subsequently called 2-ecchins in the Dogeship of John 

 Dandolo) in the year T 285 ; and it is said that the weight and 

 shape of these ducats were copied in Germany and Hungary. It 

 appears, too, that the reputation of the gold coinage of Brescia 

 and Florence commenced at about 1270 and 1290 respectively, 

 and that it extended over all Italy, and even to the whole 

 civilised world, in the next century. This extension of a gold 

 currency was, no doubt, furthered by the migration of the 



