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Coin and Currency in [No. 9, new series. 



other countries it should not only maintain itself but also yield a 

 revenue. A seignorage is in one respect, as he remarks, a unique 

 tax. Other indirect taxes are advanced by manufacturers or im- 

 porters but finally paid by the consumers. The tax on coined 

 money is advanced by every one who receives it but finally paid by 

 none. In his time Parliament allowed £14,000 a year for coin- 

 age expenses. Even the saving of this comparatively small sum 

 is not unworthy of consideration. 



A law passed in the reign of Charles II. for the encouragement 

 of a coinage made it free for a limited period. This was extended 

 by successive enactments until 1769 when it was made perpetual. 

 Most probably Adam Smith is right in his suspicion, that this was 

 a job for the Bank of England. Her interest is chiefly concerned 

 as she coins most ; and her wealth and close connexion with 

 Government in monetary affairs give her sufficient influence to 

 effect a considerable saving to her own revenues at the public cost. 



In 1816, as I have before had occasion to mention, a seignorage 

 was imposed upon the coinage of silver. A pound of standard 

 silver is coined into 66 shillings, while the mint price is only 62s., 

 4s. or 6-^f- per cent, being retained as seignorage. The gold coin- 

 age in England continues free. 



In 1771, four years before the appearance of the First Edition 

 of the Wealth of Nations, the seignorage in France amounted to 

 *A P er cen *- on S 0 ^ an( * on silver. Adam Smith represents 

 it as much higher, but erroneously. At present the seignorage is 

 insufficient to cover the expense of coinage. It is not more than 

 J per cent, on gold and 1 \ on silver. 



We have seen that all civilised nations at a period of improve - 

 ment more or less advanced have employed gold and silver — and 

 most of them some third and cheaper metal as the material of 

 their currencies. But in the earlier stages of their civilisation 

 only one metal was used for that purpose ; and, as we have seen, 

 silver more generally than gold. The Hebrews, the Greeks, and 

 the peoples who succeeded to the Roman Empire on the European 

 continent employed for many centuries an exclusively silver cur- 

 rency. So the Italian and Roman coinage was exclusively of 

 bronze until a late period. I have pointed out the traces of this 



