16 MODERN MONETARY SYSTEMS 
hand, the system of free coinage as applied to both metals 
seemed likely to put each into free circulation and allow 
the value of each to be freely determined without the 
slightest interference by public authorities ; on the other, 
it might be inferred from the fixing of a legal ratio that the 
law had at least power to determine the value of one metal 
with regard to the other—a supposition which runs counter 
to a doctrine based on centuries of experience. Neverthe- 
less, bimetallism was adopted in a great many European 
and American countries and holds a predominant place in 
the monetary history of the first three quarters of the 19th 
century. But it should not be forgotten that it was set up 
in France empirically and with the idea that the legal ratio 
would have to be altered according to fluctuations in the 
commercial value of the two metals. 
Hence considerable variations were expected to occur 
in the ratio between the two metals, as a result of a rise or 
fall in the stocks of metals and thus of vicissitudes in their 
production. Now with regard to the 70 years which 
elapsed between the year XI and 1873, the striking fact is 
not that fluctuations should have occurred, but that they 
should have been so slight and that the exchange ratio be- 
tween the two metals should have been so nearly constant. 
This is a phenomenon which calls for the attention of 
economists and gives rise to some mistrust of the principles 
which guided the originators of our monetary system. 
§ 2. Bimetallism in operation during the first three quarters of 
the 19th century. Explanation of the slight fluctuations in 
the price of silver in monometallist countries. 
In the first place, let us rehearse the facts. Throughout 
the whole of this period the legal rates between gold and 
Desrotours, a man of practical experience in monetary affairs, declared that 
such fixing is possible internally, but he admitted that owing to the 
necessity of transactions with foreign countries a constant ratio could not 
be maintained; this was true at a time when the legal ratios often varied 
considerably as between different countries. Even in the 14th century the 
notions behind the classical theory are to be found in the works of Nicole 
Oresme. (See M. Bridrey’s scholarly work, “La théorie de la monnaie 
au XIVeme siécle,” Nicole Oresme, Giard et Bridre, Paris, 1906.)