932 FINANCIAL REFORM AND THE ECONOMY
short-term minting only to provide humanitarian relief in the face of desperate
famine conditions. Nevertheless, the cash supply in the capital and other urban
areas had grown too large and cash had become so cheap that people melted it
down either to obtain raw copper or make utensils because it was more valu-
able that way. Even though specific figures for copper imports from Japan are
not available for these years, total Japanese copper exports increased from approx-
imately 430,000 hin a year in 1691 and 1692, to close to 700,000 kun in 1693
and 1694, dropped to 327,252 kun in 1695, rose to 628,348 kun in 1696, and
pcaked to r -4 million kun in 1697. What percentage of that total was shipped to
Korea is not known, but the sum presumably exceeded the 300,000 kun mark
mentioned in r693. For that reason, in the eighth month of 1696 Sukchong
accepted the proposal of the Fourth Inspector of the Office of the Inspector-Gen-
eral, Song Ching'un, to end all special permission for short-term minting oper-
ations by government agencies when the current limits on such loans expired
in the third lunar month of 1697. This decision brought all government-autho-
rized and legal minting of cash to an end for over twenty years. q
THE SECOND CYCLE: DEFLATION, 1697-1731
Ban on Minting and Deflation, 1697-1724
Sukchong's suspension of all government minting aided tremendously in revers-
ing the tide of cash surplus and price inflation in the markets, especially since
the use of cash and the production and sale of nonagricultural goods in markets
continued to spread geographically, and created more demand for cash. In the
ensuing twenty years the cash supply could not keep up with the rising demand
for its use, and the value of cash was driven so high that it became almost as
valuable as silver.
Licensed VS. Unlicensed Merchants. The demand for cash increased with the
expansion of commercial activity, and the growth of unlicensed merchants
(nanji5n). At the beginning of the dynasty the commercial activities of the licensed
capital shopkeepers (sijon) were restricted to supplying the palace and central
government with their material needs and marketing whatever surpluses were
left in the state treasuries, but by the end of the fifteenth century the population
of the capital was increased by the migration of peasants whose land had been
taken over by landlords. Many of them became merchants and set up shops around
the city, and King Chungjong in the early sixteenth century tolerated their pres-
ence to enable them to support themselves.
As these unlicensed merchants (nanji5n) became more prosperous by the end
of the century, the licensed capital merchants began to demand government per-
mission to ban competitors and grants of monopoly privileges for a wider range
of commercial activities than they previously enjoyed, especially since taxes on
licensed merchants had increased considerably after Hideyoshi's invasions. The
government was now constrained to comply with their request since it faced a