DP13501 A Silver Transformation: Chinese Monetary Integration in Times of Political Disintegration during 1898-1933

Author(s): Debin Ma, Liuyan Zhao
Publication Date: February 2019
Date Revised: February 2019
Programme Areas: Economic History, International Macroeconomics and Finance
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=13501

This paper provides the first systematic econometric study on the evolution of Chinese silver exchange and monetary regimes during 1898-1933. Using high quality data sets of monthly and daily prices of silver dollars, we apply the threshold autoregressive models to estimate the silver points between Shanghai and other seventeen cities in Northern and Central China. We find a dramatic improvement in monetary integration from the 1910s, consolidated throughout the 1920s and 1930s to rival the global standard. We supplement our analysis with new data sets on volumes and costs of silver flows and with an in-depth historical narrative. Our paper revaluates the efficiency of the silver regime and China's economic performance in the Republican era.