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Introduction:
The first country in the world to appear paper money is China, and the first region in China to appear paper money is Sichuan.
During the Northern Song Dynasty, the Sichuan region began to circulate Jiaozi, which was the earliest currency in Chinese history and even in the history of the world.
Its appearance reflected the prosperity of the economy of the Northern Song Dynasty, and only when the economy was developed and trade was frequent, the advantages of paper money as a general equivalent would be fully revealed.
The Jiaozi of the Northern Song Dynasty once became a tool for the imperial court to seize the fruits of the development of the civil economy, and gradually, the common people lost trust in the currency issued by the imperial court.
The emergence of the Southern Song Dynasty can no longer obtain the general recognition of the common people, and all this has a lot to do with the economic policy of the imperial court.
The transformation from the Northern Song Dynasty to the Southern Song Dynasty, and the evolution from Jiaozi to Huizi, reflect the direction and process of economic development in the Song Dynasty? What economic policies of the imperial court led to this shift?
Nationalized and widely used
The open civil society atmosphere of the Tang Dynasty laid a good foundation for the development of the commodity economy during the Song Dynasty.
Under the guidance of the policy of the ruling class to support commercial development, the commodity economy of the Song Dynasty ushered in an unprecedented golden age of development.
Radiating outward from the capital city of the Northern Song Dynasty, among all the regions and cities, the country of Tianfu is the most active area for the development of civil free economy.
There are abundant salt and iron resources, a variety of different varieties of tea, soft and skin-friendly silk, and a variety of delicacies. The goods produced by the Land of Heavenly Prefecture were loved by the rest of the country in a short period of time.
In order to trade commodities, the use of money is essential, and the essence of money is a general equivalent, which itself does not have any value and belongs to an intermediary tool for measuring the value of commodities.
Previously, people used barter, such as exchanging one sheep for ten chickens.
Later, people used shellfish money and bronze money, but the circulation class of money was only limited to the upper class, and after the emergence of metal money, all kinds of copper money, as well as gold and silver, were circulated throughout society.
Before the advent of Song Dynasty paper money, metal money was used in most parts of the country for exchange, and for some merchants with large commercial scales, the use of metal money was extremely inconvenient.
Metal money itself has a certain weight, every time before going out to do business, they will carry a large amount of metal currency, the weight generated by the currency, often cause an extremely heavy burden on their journey.
So some businessmen began to think, how to make commodity trading easier and more convenient?
Driven by this idea, the people began to circulate paper money.
In the beginning, banknotes were only circulated in a small area in Sichuan, and merchants from different industries formed a business district, and some people in the business district were responsible for formulating various rules related to the use of banknotes.
For example, how much value of goods can be measured in different denominations of banknotes, how large-denomination banknotes should be converted into small-denomination banknotes, and more regulations related to it.
In the business circle, all members reached a consensus and used paper money for transactions, so the paper money of the Song Dynasty was not the official currency at first, but a form of commodity trading circulated by the people.
In order to gain the widespread trust of the people, this part of the merchants also obtained permission from the government to issue paper money, and during the reign of Song Zhenzong, Jiaozi became a popular form of money among the people in Sichuan.
After Song Renzong succeeded to the throne, the ruling class found it profitable to issue jiaozi, and also found that with the development of the times, the public had certain doubts about privately issued banknotes.
In order to make a profit and solve the problem of trust, the government took all the banknote issuance business for itself.
From now on, only the jiaozi issued by the government can be circulated in the market, and the jiaozi issued by private organizations will be treated as counterfeit and shoddy currency.
Analogous to today's economic development, Jiaozi is like a renminbi issued by People's Bank of China uniformly, with official designation and uniqueness.
There are also illegal organizations in the private sector to counterfeit the renminbi, and the results they produce are counterfeit currency and cannot be circulated in the market.
In order to distinguish it from counterfeit and shoddy jiaozi, the government put a lot of effort into the materials and production of banknotes.
First of all, in terms of materials, the government uses paper that has been treated by special means, which has stronger toughness, is not easy to be damaged, and is easy to preserve than the original paper.
Special technologies and means have not been disclosed by the government, so it is not easy to forge the hand.
In terms of production, the government has also introduced a policy of upgrading.
Usually, the government launches a new batch of jiaozi every two to three years, and at the same time, all the old jiaozi on the market will be recycled into the hands of the government.
The ratio of value from issuance to recycling is always maintained at the level of 1:1.
In other words, if you have 100 old notes in your hand, you can take all the notes to the government office and exchange them for the same amount and denomination of new Jiaozi notes.
The imperial court often set a certain exchange period, which may be one to three months, and the maximum is not more than half a year.
After the expiration of the exchange period, all old banknotes cannot continue to circulate in the market, and ordinary merchants dare not accept old handies at will without the official recognition.
The government updates banknotes with a certain frequency, in addition to ensuring the property safety of the people, it is also because this matter is profitable.
In the face of merchants with a relatively mature commercial scale, the government will charge a certain percentage of the handling fee, according to the records of the Song history, for every thousand money exchanged, the parties need to pay a 3% handling fee to the government.
Don't underestimate the figure of 3%, under the condition of a huge number of exchanges, the government can obtain a large amount of profit income.
In addition, the "Song Penal System" has also kept pace with the times and made new regulations on the use of banknotes.
If someone violates the rules by counterfeiting banknotes, or circulating banknotes that are not officially recognized, he will be severely punished by the law, and in serious cases, he will even lose his life.
This is the early economic crime of ancient Chinese society, which shows that the law of the Song Dynasty attached great importance to the order of the economic market.
Massive issuance, currency depreciation
When the imperial court found that it was profitable to issue jiaozi, in order to collect cash as much as possible and maximize their own economic interests, they would issue paper money without any limit, so that they violated the laws of the market economy and committed acts that harmed the economic order.
The imperial court issued excessive paper money, not only because it was profitable, but also because state spending was increasing.
As we all know, the regime of the Northern Song Dynasty has not been very stable, and the cowardly Northern Song army has never been able to compete with the ethnic minorities in the north, and most of the time it is wrapped up in the battlefield, and military expenditure increases year by year.
In order to meet the needs of the northern army, the imperial court could only continue to issue currency, and wanted to stimulate social production and consumption by this means, thereby increasing the speed of economic circulation and increasing economic prosperity.
However, the opposite of the extreme of things is an objective law, and when the number of banknotes issued exceeds a certain scale, more terrible social phenomena occur.
When there are too many banknotes on the market, currency depreciation is an inevitable result.
In the past, a dollar could buy a pastry, but now everyone has paper money in their hands, and there are many of them, the value of a dollar will be infinitely reduced, and the same pastry may cost ten dollars to buy.
This is the principle of inflation, and in the Northern Song Dynasty, inflation has appeared on the market because of the excessive issuance of paper money.
Ordinary people have limited ability to create economic value, and in layman's terms, they simply cannot keep up with the speed of inflation and currency depreciation.
Farmers work in landlords' homes and receive a limited fixed salary a month.
In the past, this part of his salary could cover the basic financial expenses of the family, but when the value of money depreciated and the price of goods rose, the salary in his hands could no longer bear the cost of maintaining expenses.
The peasants' wages will not rise with inflation, but the landlord class will try to suppress and exploit the peasants, so the direct victim of inflation is the lowest peasant class in society.
Many people have been displaced because they cannot afford to live a heavy life.
To what extent did the paper money depreciate during the Northern Song Dynasty?
Taking the Song Zhezong period as an example, the new type of jiaozi issued during that period can be exchanged for five old jiaozi of the same denomination.
Money is no longer valuable, and the banknotes stored in the hands of ordinary people are like waste paper, which cannot produce greater economic value.
Because of inflation, the living standards of a large number of ordinary people have plummeted, some people cannot even guarantee their basic right to subsistence, social problems are increasing, the masses are full of grievances, and the political order of the ruling class has also been affected.
The common people had lost trust in the official government, so in the late Northern Song Dynasty, some people who were desperate even took out their family friends and set them on fire, and their behavior was very extreme.
As the economic pressure of the imperial court grew year by year, and the financial expenses increased day by day, they could not come up with more money as a guarantee.
In the absence of a security deposit, the credibility of the imperial court was greatly reduced, hundreds of people refused to use paper money for transactions, and metal money returned to the market, which was a serious economic regression.
The Song court not only failed to handle the crisis, but gave more officials room to disrupt the market order.
They used the currency they had hidden in their hands to forcibly transfer in and out of the market, resulting in a serious imbalance in the market order and causing many tragedies of family ruin.
The Jiaozi era of the Northern Song Dynasty also completely collapsed with the Northern Song regime.
Southern Song banknotes, aggravating the collapse
After the capital of the Northern Song Dynasty was occupied by the Jin people, Zhao Zhi, with the support of loyal courtiers, established the Southern Song regime in the south, competing with the ethnic minorities in the north.
At present, the Central Plains regime has not completely collapsed, and the Southern Song Dynasty is still a ruling feudal dynasty. In order to envelop the achievements of the world's economic development, the Southern Song Dynasty naturally issued official unified banknotes like the Northern Song Dynasty.
Unlike the Jiaozi of the Northern Song Dynasty, the banknotes issued by the Southern Song Dynasty were called Huizi.
The ruling class intended to adopt the economic development mode of the early Northern Song Dynasty, with the central court issuing paper money uniformly, distinguishing it from other forms of money circulating among the people.
The government uses its official dominance to endorse paper money and gain the trust of the people.
This is a good idea, but the ruling class overlooks the fact that the people have lost trust in the central court, and once that trust is lost, it is difficult to make up for it.
Moreover, due to the tight war in the north, the imperial court could no longer take money as a guarantee, and the people saw that the imperial court could not even show basic sincerity, let alone trust the imperial court and use the meeting.
By issuing paper money, the government further plundered the wealth of the people, at the cost of its own trust, in exchange for meager economic gains, and ultimately the gains outweighed the losses.
As the so-called water can carry a boat, it can also overturn it, losing the trust of the people and the driving force of economic development based on the masses, and the Southern Song Dynasty can only go to the established collapse end.
Epilogue:
The official unified issuance of currency is to forcibly intervene in the market economic order with the regime, which is a means of macro-control.
But the market itself has an invisible big hand, and when the macro-control means go against the laws of the market itself, the country's economic development will naturally go downhill.
No matter what the era, economic policy must conform to changes in the laws of the market.
Resources
History of Song
"Song Penal System"