ABSTRACT
Gold coin in each country was given by law a determinate value in terms of the money of account and therefore of silver. But different countries were apt to adopt slightly different ratios between gold and silver, and endless troubles resulted. Gold was undervalued in terms of silver, in comparison with its value in the European market. The effect was to raise the ratio of gold to silver in that country to 15½. The effect of the revised ratio of gold to silver in France was to attract gold to that country in preference to silver, and so to cheapen silver in terms of gold in the European market. The bimetallic country is in the position of a dealer undertaking to buy and sell unlimited quantities of both metals at fixed prices. The export of gold was regarded as a signal for credit contraction in the country which suffered it.
