The Research Of The Interest Group And The Reform Of The Monetary System On Abolishing Silver Taels And Enforcing Silver Dollar Of The Republic Of China

Abolishing silver taels and enforcing silver dollar is the monetary system reform that is carried out throughout the country by the Nanjing nationalist government in1933.The main purpose is to abolish the sliver ingots and have the country establish the unified silvery currency system to achieve the unification of Chinese currency system.The main content is abrogating the right of casting and issuing of the provinces,banning the province mints,having the national government possess a unified jurisdiction and establishing national mints,and casting and issuing silver dollar as national currency in accordance with the unified standard;confirming the exchange standard between silver taels and silver dollar of each region and having the domestic financial institutions exchange the taels into silver dollar within a specific time limit;taking silver dollar as the international currency conversion standard and abolishing the standard based on silver taels.Modern Chinese social and economy structure has experienced a transformation from traditional agricultural economy to modern capitalist economy.After the Opium War,China has become a semi-feudal and semi-colonial modern society.Foreign goods and capital has flowed into the vast mainland countryside from the southeast coastal city.Under such impact,Chinese traditional agricultural economy of self-sufficiency has been gradually disintegrated;what's more,during the process,traditional Chinese currency system has been suffering from severe impact.In the late Qing Dynasty,the traditional concurrent silvery and copper system has been disintegrated due to the fierce impact of foreign silver dollar.Plentiful foreign silver dollars have flowed into China during the process of the input of foreign capital and international trade.Silver coins are quite convenient in daily trades and has circulated massively in the currency due to shortcoming of silver taels(tael has to be weighted,while silver dollar can be counted).In the development of the modern society,Chinese national industry and commerce has developed rapidly and has created and fastened the development of the market-based modern economy.The traditional narrow regional market of modern China has been broken up with the increasingly connection among regions.In commodity trading among regions,silver currency of different standards,of various countries and those casted bydifferent regions has led to chaos in modern Chinese currency system.The metallic currency in circulation at that time included silver taels,silver dollar,coppers and etc.Due to the difference in fineness and weighted standard in different regions,Silver tael,which is regarded as an out-of-date weighted currency,requires complicate identification and conversion before using.Due to the non-uniform of the pattern and standard in various regions,there are more than 10 kinds of silver dollar.During the period,domestic financial institutions have issued plentiful paper currency which can be used to be exchanged by any metallic currency at any time which has worsened the disordered Chinese currency system.Facing the disordered domestic currency system,successive governments and people with visions have to consider about ways to unify currency to bring the confusion to an end.Abolishing silver taels and enforcing silver dollar has become the scheme to achieve the unification of the domestic currency system.Any reform may influence the fundamental interest of different social groups,and those interest groups are of certain to be the main force to influence the reform process.Under the semi-feudal and semi-colonial social environment,three power interest groups emerged,which are old-style Chinese private bank,foreign bank and Chinese bank.Old-style Chinese private bank represents the force of the traditional financial capital,which plays fundamental roles in modern financial system;foreign bank is on behalf of the development of foreign currency in China,which plays leading role in modern financial system;Chinese bank stands for the strengths of modern Chinese financial capital and has risen rapidly in modern financial field.Abolishing silver taels and enforcing silver dollar has violated the fundamental interest of old-style Chinese private bank and foreign bank.They are both the vested interest groups under the silver tael currency system and the obstacles to reform,while Chinese bank,whose aim is to break through the traditional silver tael currency system,has become the crucial promoter during the reform.Old-style Chinese private bank,foreign bank and Chinese bank competed with each other based on “abolishing silver taels and enforcing silver dollar ”for the maximizing of the self-interest in the shifting financial system,which exerted influence in different stages on the launching and implementing of abolishing silver taels and enforcing silver dollar.From 1928 to 1929,the government initiated the reform of abolishing silver taels and enforcing silver dollar;however,due to the reason that the force of old-style Chinese private bank outweighed that of Chinese bank,the reform was blocked.Great changes has taken place in domestic and foreign political situation from 1930 to 1933 and exerted influence on domestic financial system.The comparison of the three financial interest groups has changed,and Chinese bank,which represent the strength of the reform rose rapidly.Ultimately,the reform succeeded and achieved the unification of modern Chinese currency system.Abolishing silver taels and enforcing silver dollar has exerted profound influence on the development of Chinese finance,commerce and market,and has provided a solid foundation for China to get involved into the world financial currency system.This reform has achieved the unification of the casting and issuing of silver dollar,the abolishing of the right to cast and issue currency of local government;the enforcement of the influence of the government to financial currency system.The reform has greatly reduced the trade expenditure,promoted the development of the commodity,weakened the monopoly of foreign bank to the import and export of Chinese silver and international currency conversion,provided safeguard for the development of Chinese modern economy and get well prepared for the 1935's currency reform.Based on the research of the relationship between interest groups and abolishing silver taels and enforcing silver dollar,it can be concluded that the parochialism of the interest groups has influenced the process of the reform of the monetary system on abolishing silver taels and enforcing silver dollar;while the decline of the conventional financial capital and the rise of the modern financial capital may certainly trigger the successful implement of the reform of the monetary system on abolishing silver taels and enforcing silver dollar.