POLI 12 Lecture Notes - Lecture 15: Seigniorage
Lecture 15:
Development: Causes of the Wealth and Poverty of Nations
Money:
Originally money wasn’t money, trade was done by bartering.
You traded one thing for another. The origin of money came in this process.
Trading things for other things wasn’t very convenient, so the human species convened upon
something that was universally wanted and easy to transport, like metals.
So people started using gold and silver to trade but there was one big drawback as they could be
diluted with other metals, and also every time you melted it down to assay it, you would lose a bit so
eventually, the governments started to track and verify the gold.
They started stamping the gold disks and regulated the
Seigniorage: If you own the transaction process, you can take some of the value out of it.
Governments print coins and decide the value of them, but if they were sketchy about it, they
wouldn’t be used by people anymore.
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