Some Doubts about the Economic Analysis of the Flow of Silver to China in 1550–1820

Abstract

The paper takes issue with the mainstream economic analysis of the enormous flow of silver into China in 1550–1820. First, I challenge the view that arbitrage between gold and silver in European trade with China was important except for one twenty-year spell. Next, I argue that had China imported gold, its history would have been much the same. I also dispute the idea that the persistence of the silver inflows from 1550 to 1820 implies any persistent disequilibrium, and I maintain that economic theory can easily accommodate the view that the inflow of silver into China sponsored growth in China.