And according to the law of value, things are rare. When the supply of a commodity exceeds the demand, it will inevitably depreciate. Therefore, if the Ming Dynasty imported a lot of silver, the silver in the Ming Dynasty would definitely depreciate. However, in history, the value of silver has been relatively stable. What happened?
In the Ming dynasty, with the first globalization movement in the world, the influence of the era of great navigation. World trade has entered a new period of prosperity. Western adventurers have come to Asia to establish colonies and gain huge wealth through trade and plunder. In this kind of trade, trade with the Ming Dynasty accounted for a large proportion.
Some people joke about that era. China's predecessors pinched something with mud and burned it, or picked some leaves from trees, raised some bugs, twisted them into a ball and sold them directly to foreigners for a lot of money. Although this statement is a bit exaggerated, it reflects some facts of that year.
At that time, Spaniards, Portuguese and Dutch all came to the Pacific region, and trade with China was their main purpose. At that time, the Ming dynasty, although still in a state of sea ban, was caught in the tide of global trade.
In foreign trade, besides spices, merchants in the Ming Dynasty mainly worked as cashiers. Due to China's unparalleled manufacturing and export of silk and porcelain, its trade with any country is in surplus. This forced those foreign businessmen to trade with China businessmen with silver. This makes China a silver superpower.
Among these inflows, silver from Japan and Spain is the main source. According to Frank, an American scholar, from16th century to17th century, the amount of silver flowing into China is roughly as follows:
At that time, the United States produced 30,000 tons of silver and Japan produced 8,000 tons of silver, totaling 38,000 tons. Among these silver, 7000 to 10000 tons of silver finally flowed into China.
In other words, at that time, China's silver production accounted for a quarter to a third of the world's, and the algorithm converted to China was that about 320 million silver flowed into China.
Arguably, the influx of such a large amount of silver into China will definitely lead to the flooding of silver and make it depreciate. However, we can see that the value of silver has been fluctuating in a relatively stable range. What's going on here?
This is because silver is in China. It not only represents commodities, but also plays the role of money. In China, silver and brass are both poor minerals. Due to the shortage of physical objects, money circulated in the form of paper money in the early Ming Dynasty. We can see how much money was used at that time. Although this kind of paper money is officially issued, it has no precious metal as collateral, and of course its credit is extremely poor.
The inflow of silver just made up for this defect. With the popularization of silver, a precious metal with value preservation function, it naturally plays the role of currency. Because of this advantage, it was later implemented in the Ming Dynasty? A whip? Law, which established the status of silver standard system in Ming Dynasty. Silver became the common currency of the Ming Dynasty.
In the huge Ming empire, it is a huge amount to replace those junk paper money with silver. This requires a lot of silver imports. Coupled with taxation, trade and other aspects, more silver is needed.
In this way, the inflow of foreign silver just fills this huge gap. For example, the amount of silver imported earlier was exactly the sum of the state treasury's tax revenue at that time. There are some profound meanings behind this.
As the currency of the country, the country needs to have a basic regulation on the price of silver supported by the state machine. For example, in the national laws and regulations, the value equivalent to the tax paid becomes the national guiding price for the value of silver. This also helps to stabilize the value of silver.
In this way, there is a delicate balance between government intervention and market demand, plus the annual silver surplus and the total output value of social growth. All these make silver maintain a relatively stable value in China.