Quarterly Journal of Austrian Economics

100 Percent Reserve Money: The Small Change Challenge

The Quarterly Journal of Austrian Economics

Volume 12, No. 1 (2009)


In a free market economy from which fiduciary media are excluded, economic progress will be limited, perhaps severely, by the high cost and correspondingly limited supply of small-denomination money—money that is needed to accomplish retail and other low-value exchanges. Historically, fiduciary token coins have proven to be the only practical means for addressing the small change problem, whether officially or unofficially. In partic-ular, privately-supplied, fiduciary token coins played a crucial part in Great Britain’s Industrial Revolution, which might not have been possible without them.



Selgin, George. “100 Percent Reserve Money: The Small Change Challenge.” The Quarterly Journal of Austrian Economics 12, No. 1 (2009): 3-16.

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