Coin Production, Coin Circulation, and the Payment of Wages in Europe and China 1200-1900

Jan Lucassen, "Coin Production, Coin Circulation, and the Payment of Wages in Europe and China 1200-1900", in: Christine Moll-Murata, Song Jianze, and Hans-Ulrich Vogel (eds.), Chinese Handicraft Regulations of the Qing Dynasty: Theory and Application
München: Iudicium, 2005, 423-446.

Abstract: Monetary systems characterised by the large-scale production of small change have been known in both China and Europe for 2.5 millennia. If we concentrate on this small change, in which wage labourers were remunerated, taxes and rents were paid by the common man and woman and, finally, weekly and daily purchases were made, we may discern similarities and differences between the two extremes of the Eurasian land mass.
Similarities can be found in the way proletarianization took place and maybe also in the degree of proletarianization, i.e. in the degree to which income was derived from wage labour. However, differences can be observed in such matters as the number of coins received by the labourers, and especially in the discrepancy between wages agreed upon and the wages received. This has to do with the characteristics of what we might call mint production logistics.
In China from 200 BC until 1900 AD a monometallic and monodenominational system dominated, where basically only the so-called bronze, copper of brass "cash coins" were fabricated. This did not change after the expansion of the use of silver in China; as silver only circulated in the form of ingots. In times of high silver value and low cash value it was very likely that payments would be demanded by the seller in silver- even in the case of small payments, as these could be transacted in silver pieces and fragments weighed with a balance.
Silver, circulating as bullion, normally was of no use for the payment of wage labourers, except for elite soldiers and high state officials. In Europe, West- and South-Asia on the contrary, multidenominational and multimetallic monetary systems dominated. This means that in Europe and India wages as a rule were paid in small silver coins or in big copper coins. The consequences of these two systems for the wages of the common workers are discussed.