Abstract

"Merchants and Financial Revolution: Interstate Trade, the Great Recoinage, and Shifting Scales of Money"

Ellen Nye, Harvard University (emnye@purdue.edu)

The end of the seventeenth century was a period of tension when increasingly assertive early modern states grasped at monetary sovereignty and longer-term public debt while also facing the power of global finance with merchants moving money more quickly and easily than ever before. This paper examines the connections between interstate private credit and domestic public finance through seventeenth-century Anglo-Ottoman trade. It examines how merchants who served as creditors and state financiers in the Ottoman Empire—England’s largest market for its prized woolen textiles—returned home to London where they assumed elite positions in the Bank of England and imperial bureaucracy governing money in the Atlantic, South Asia, and within England. In these positions they drew on their experiences with Ottoman finance and crafted polices that promoted the interests of metropolitan creditors through the “intrinsic value” theory of money, the idea that coins are equal to the value of their precious metals. Contrary to a longstanding Eurocentric emphasis on domestic developments, I show that their monetary thinking was formed abroad—particularly in the Ottoman Empire, debuted in the colonies, and then contributed to the English Great Recoinage of 1696, persistent hierarchies of imperial subjecthood, and the intellectual underpinnings of the later international gold standard.

The importance of the connections between private credit and public finance is often lost in the division between studies of long-distance trade and political economy. Studies of long-distance trade following in the tradition of Avner Greif often portray merchants as managing their transactions independent of any state. Studies of state public finance frequently adhere to national categories and present public finance as largely divorced from private interstate credit networks. By working between private credit and public finance, we see the personal inter-imperial entanglements at the heart of an emerging capitalist system.