Commodity and token monies

Thomas J. Sargent

    Research output: Contribution to journalArticlepeer-review


    A government defines a dollar as a list of quantities of one or more precious metals. If issued in limited amounts, token money is a perfect substitute for precious metal money. Atemporal equilibrium conditions determine how quantities of precious metals and token monies affect an equilibrium price level. Within limits, a government can peg the relative price of two precious metals, confirming Fisher’s (1911) response to a classic criticism of bimetallism. Monometallism dominates bimetallism according to a natural welfare criterion.

    Original languageEnglish (US)
    Pages (from-to)1457-1476
    Number of pages20
    JournalEconomic Journal
    Issue number619
    StatePublished - Apr 1 2019

    ASJC Scopus subject areas

    • Economics and Econometrics


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