The Classic Gold Standard: 1870-1914
Debates on issues about the economy, growth, inequality, fiscal responsibility, and financial crises frequently reduce to debates about money. Moreover, debates about money often reduce to the soundness of money, meaning the ability of a unit of currency to retain its value. Eventually, discussions about soundness touch on the classic era of the gold standard. The aims of this note are to (1) describe the mechanism of the international monetary system known as the gold standard during the time that it had the greatest influence on the global economy; (2) place the gold standard in context with other systems that preceded and followed it; and (3) dispel some enduring misconceptions.