The agricultural output of England and Wales 1925

Bibliographic data

Monograph

Identifikator:: 1757028552

URN:: urn:nbn:de:zbw-retromon-135495

Document type:: Monograph

Title:: The agricultural output of England and Wales 1925

Place of publication:: London

Publisher:: Stat. Off.

Year of publication:: 1927

Scope:: XV, 152 Seiten; graph. Darst., Kt.

Digitisation:: 2021

Collection:: Economics Books

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RECOVERY OF THE EXCHANGES 33 determined the variable import silver point in the exchange rate of the rupee, so that even at times when India had a surplus trade balance the exchange value of the rupee could not rise much above a rate given by the market value of the weight of fine metal which it contained.! The suspension of coinage, or rather of the system of free coinage, was therefore much more efficacious than the mere process of monetary contraction, since its effect was immediate. It acted directly on the exchange by abolishing the silver point limit, which may have been unstable, but prevented the rate of the rupee from rising above the value of its content of fine metal. The first effect of this measure was likely to be that the rate of the rupee would separate from that of silver ; and this is what in fact happened ; the exchange value of the rupee henceforward rose above a rate corresponding to the price of the metal which it contained. Thus in pursuing one object, viz., monetary contrac- tion, the Indian Government had attained another, and one which was much more to the point; they had de- stroyed the connecting link between the rate of the rupee and that of silver. Moreover, after closing the mints to the coinage of rupees, the Government of India was obliged to provide persons owing debts in the country with another method of discharging their obligations. It was decided to accept pounds sterling, giving in exchange silver or paper rupees at the rate of 15 rupees to the pound, i.e., 16 pence a rupee. This was therefore the new parity which, with the addition of the costs of transmitting gold coin, was to de- termine the import gold point, limiting the maximum value of the rupee to this rate whenever there was a sur- plus trade balance ; and this was in fact a first step towards stabilising at the desired rate of 16 pence the exchange 1 This shows that Walras need not have been concerned by the possible influence of internal causes on the value of the rupee, such as the number of rupees in circulation in India; for the rate of exchange was definitely bound up with that of silver for the reasons given, and depended on the world market for that metal. D

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