194 ECONOMIC PRINCIPLES

Before passing from the subject of paper currency, the
question of how such currency may secure a circulating
power requires consideration. It is almost{sufficient to say
that mere convenience secures the use of a medium of
exchange, and that this applies with full force to a medium
less cumbrous than metal would be. If the notes can
command the confidence of the people, or, in any other way,
can offer a sufficient assurance that the holder will have no
difficulty in getting them accepted as good payment, circulation
 is ensured. The confidence may be based on the
assurance that, whenever required, redemption in full-valued
money will be certain. Thus a redeemable currency, known
to be such, hardly needs any assistance from the government
 to commend it to the people. In many cases,
as, for example, in Scotland and in Canada, bank-notes
are not a legal tender, but that does not hamper their
circulation.
A government paper currency, as to which there is a
probability or a certainty that redemption in coin will not be
made when required, or a bank currency issued under government
 patronage, or for the convenience of the government,
in regard to which a like doubt of prompt redemption is
entertained, needs some aid to establish it in circulation.
The declaration that it is a legal tender for debt may be
made, or the government may, while not making it a universal
 legal tender, agree to accept it in payment of dues,
either or both of which methods may generally be relied on
to familiarise the public with the handling of a paper
currency and thus secure it a circulating power. Its use in
making payments by the government mav introduce it into
the circulation.
As to metallic money, the right of issuing coin is, in
modern times, regarded as a prerogative of the sovereign
power in any country, though it may not be exercised, or not
to the exclusion of coins made by others. Thus, in many parts
of the Far East, the circulation consists largely or wholly of
dollars coined by the Mexican government, while the Austrian
government regularly strikes Maria Theresa thalers, used
mainly in Africa and Arabia. As a rule, however, a govern-