TY  - JOUR
AU  - Grubb,Farley
TI  - Two Theories of Money Reconciled: The Colonial Puzzle Revisited with New Evidence
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 11784
PY  - 2005
Y2  - November 2005
UR  - http://www.nber.org/papers/w11784
L1  - http://www.nber.org/papers/w11784.pdf
N1  - Author contact info:
Farley Grubb
University of Delaware
Economics Department
Newark, DE  19716
Tel: 302/831-1905
Fax: 302/831-6968
E-Mail: grubbf@udel.edu
AB  - The purported failure of the classical quantity theory of money in the colonial economy is shown to be a failure of data and not a failure of theory. When new data on the quantity of specie in circulation is added to the current data on paper money and prices, and econometrically estimated in both short- and long-run monetary models, the long-debated anomaly regarding the performance of the classical quantity theory of money in the colonial economy disappears. How paper money was backed and could be exchanged for specie was important, but not in the way theorists assert.
ER  -