(^28) Chapter Two
prices, state revenue could readily be enlarged. The decision of 1083
thus represented a reversion to old, well-established patterns of taxa
tion,^9 though one may readily believe that resulting high prices may
have inhibited the expansion of private, civilian uses for iron and steel,
and thereby helped to check any further growth of production.
Hartwell has not tried to estimate the end uses to which Chinese
iron and steel were put in the eleventh century. Only scattered data
survive. A single order for 19,000 tons of iron to make currency
pieces, and a mention of two government arsenals in which 32,000
suits of armor were produced each year, give a glimpse of the scale of
government operations in K’ai-feng in the late eleventh century when
iron from the new foundries was pouring into the capital at an ever
increasing rate. But such information does not permit any estimate of
how much went into armaments as against coinage, construction, and
the decorative arts.^10 How much iron and steel escaped governmental
manufactories and entered the private sector also remains unknow
able, though Hartwell believes some did.
Even if the decision in 1083 to monopolize the sale of agricultural
implements made of iron resulted in restricted production, it is worth
pointing out that official management of the economy in medieval
China had attained a good deal of self-consciousness and sophistica
tion. The theory was concisely expressed by Po Chü-i (ca. 801) as
follows:
Grain and cloth are produced by the agricultural class, natural
resources are transformed by the artisan class, wealth and goods
are circulated by the merchant class, and money is managed by
the ruler. The ruler manages one of these four in order to regu
late the other three.^11
Currency management took on modern characteristics. Paper
money had been introduced in parts of China as early as 1024; later,
by 1107, the practice was extended to the capital region itself.^12 A
- Cf. Esson M. Gale, Discourse on Salt and Iron (Leiden, 1931).
10. Iron and steel were used in bridges, pagodas, and statues. Cf. Needham, Iron and
Steel Technology, pp. 19–22; Hartwell, “A Cycle of Economic Change,” pp. 123–45;
Hartwell, “Markets, Technology and the Structure of Enterprise, pp. 37–39. - Hartwell, “Financial Expertise,” p. 304.
- Yang Lien-sheng, Money and Credit in China: A Short History (Cambridge, Mass.,
1952), p. 53. Robert Hartwell, “The Evolution of the Early Northern Sung Monetary
System, A.D. 960–1025,” Journal of the American Oriental Society 87 (1967): 280–89.
Paper money was, initially, backed by silver. “If there was the slightest impediment in
the flow of paper money, the authorities would unload silver and accept paper money as
payment for it. If any loss of popular confidence was feared, then not a cash’s worth of