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date: 09 December 2023

Monetary Flows and Currency Management in Ming-Qing Chinalocked

Monetary Flows and Currency Management in Ming-Qing Chinalocked

  • Arturo GiráldezArturo GiráldezUniversity of the Pacific


In 1571, colonists from the viceroyalty of New Spain founded Manila as capital of the Philippines and established a line of navigation between its port, Cavite, and the Mexican city of Acapulco. Their ships linked the rich mines of the viceroyalties of Perú and New Spain with the Ming and Qing Chinese empires, inaugurating a global economy based on silver from Latin America, and, to a lesser extent, Japan. The Chinese adopted silver as money in response to the high inflation of paper notes as a result of imperial expenditures. Merchants in the southern maritime provinces initiated the inflow of silver in the 15th century, and the central government soon began commuting taxes in grain to payments in silver. The purchasing power of silver in China rose precipitously relative to that of Europe and Japan, stimulating European and Japanese appetites to trade with the Chinese empire. The global silver economy could be divided in three periods: (a) the Potosí–Japan Silver Cycle (1540–1640), when Japanese and Peruvian (modern Bolivia) mines were the main producers of silver. The cycle ended with the equalization of the relative global prices of silver and gold about 1640; (b) a shorter Mexican Silver Cycle (1700–1750), when México was the main producer of silver; followed by (c) the Tea and Opium Cycle, initiated by the Battle of Plassey in 1757 that led to the British control of Bengal, the Opium War (1839–1842), and the presence of foreign powers in Chinese territories. Silver continued its journey into China but the high-profit markets were generated by Chinese tea and opium from India. These trade cycles are the origin of the modern globalized economy.


  • China

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