Non-Legal-Tender Paper Money: The Structure and Performance of Maryland's Bills of Credit, 1767-1775
Year: 2014
Type: report
Abstract: Maryland's non-legal-tender paper money emissions between 1765 and 1775 are reconstructed to determine the quantities outstanding and their redemption dates, providing a substantial correction to the literature.Over 80 percent of this paper money's current market value was expected real asset present value and under 20 percent was liquidity premium.It was primarily a real barter asset and not a fiat currency.The liquidity premium was positively related to the amount of paper money per capita in circulation.This paper money traded below face value only due to time-discounting and not depreciation.Past scholars have simply confused time-discounting with depreciation.
DOI: 10.3386/w20524
Authors: Jim Celia, Farley Grubb
Institutions: National Bureau of Economic Research, University of Delaware
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1533219286