Research On The Evolution Of Monetary System In Ming Dynasty

In the contemporary monetary credit system, our long-term goal is to achieve the stabilization and internationalization of China Yuan (CNY) especially when the appearance of new virtual currency disturbs the CNY circulation. Under this background, we investigated the history and found that the commercial development in Ming dynasty is similar with the current situation. Its monetary system is developed diversely with three periods: copper, silver and paper money system. This process experiences the depreciation of paper money and monetization of silver. This paper tries to explore the theoretical regularity from historical experiences. The author reviews historical facts, summarized advantages and disadvantages, summarizes regularities and applies them in the practice based on the historical failures.This article mainly discusses the development of monetary system in Ming dynastybased on the evidence from history. It mainly uses the historical analysis, comparison analysis, summarization and symbolicgraphic combination to investigate the copper, silver and paper money system in three dimensions: issuance, circulation and management.For the failure of paper money system, the main reasons are no preparation and limitation of issuance. For the copper money system, we conclude that only the money made from official government is legal. The supply and demand of silver shows the historical necessity of constructing silver money system. In fact, the appearance of Fei-qian in Tang,Jiao-zi in Song and Bao-chao in Ming facilitates the process of changing copper moneysystem because the monetization of silver ends this disordered system and keep the stabilization of Chinese money system in the level of precious metal.Based on this background, the article analyzes three types of money in two dimensions and finds following points: first, we explore the legality of virtual currency which iswidely applied as the tool financial settlement on the internet. By comparing it with themoney made from private agencies in Ming dynasty, we recommend that the government should inhibit the circulation of other types of money except sovereign currency. Second, the outflow of copper and inflow of silver shows that the formation of district usingcopper as currency is result of prosperous foreign trade. Therefore, the regional currency is the product of foreign commercial trade. Third, the contemporary situation is similar with Ming dynasty: the central government manages the politics issues and commercia l trade is well developed. Since the commercial revolution in Ming dynasty leads to thefinancial revolution, we expect that the similar financial revolution will occur soon: theInternet finance challenges the traditional finance.This paper gives insights about the currency circulation and management by analyzing the development of money system in Ming dynasty and summarizing the successfuland failing experiences.