Currency And War In Southern Song Dynasty

Southern Song was the first Dynasty that took the paper money as the maincurrency; the main reason was the pressure of war.As the chasing of Jin Dynasty’s army, Zhao-gou established the government of theSouthern Sung Dynasty, so from beginning of establishment, this regime was at risk,because the tremendous financial pressure obviously. This pressure was that thebroken financial system and the huge military expenditure co-existed at the same time.The main reason of huge military expenditure was the mercenary system in SouthernSong. From the period of the Spring and Autumn and the Warring States to the Handynasty, the system of military service was recruiting, whose the Advantage was thepeople’s lesser taxes and corvee burden when war free. The mansion army systemmainly remained this character in early Tang. After that, the mercenary system wasput in force generally. In according to the regulation of the mansion army system, thegovernment of Song not only provided of all military goods concluded soldiers’commissariat and so on but also provided living expenses for soldiers’ family. Underthe military pressure of Jin and Yuan Dynasty, the number of Sothern Song’s armyremained100,000year in year out. If soldiers’ family courted, the Southern Songgovernment provided living expenses for nearly a million people, in addition, thehuge military expenditure, so it was obvious that the Southern Song was under greatfinancial pressure.In contrast with the huge military expenditure, the economy was destructedseriously, the Song government not only lost1/3land, also the rest of land was ofteninvaded. Under the huge military pressure, the Southern Song government had to takethe note issue as the important way to solve the financial deficit. Issuing notefrequently, lengthening the paper money using time, all of these produced negativeeffect.In the early period, Southern Song government was cautious to issuing note.Frequent war and huge military expenditure took the finance into dilemma. Lengthening the paper money using time, increasing the number of paper moneycaused the currency devaluation and led to rising prices.Frequent war took the issuing note into the vicious spiral. In order to raise thewar material, the government increased tax, while, the huge number of circulationtook the people’s living into the dilemma.