900 FINANCIAL REFORM AND THE ECONOMYments of exchange, bills, drafts, or more modem banking arrangements. Curi-
ously, even though his own country had experimented with paper money unsuc-
cessfully for the better part of the fifteenth century, and kings like T'aejong and
Sejong had led the way in the effort to introduce it, he neither studied nor ana-
lyzed the reasons for that failure, but merely assumed that the failure of paper
money to last into the Ming era must have proved that it was flawed as a medium
of exchange. In that respect, one suspects that his attitude toward money was
perhaps more conservative than those aforementioned kings ofthe early Choson
dynasty!
THE WISDOM OF CHINESE MONETARY EXPERIENCE
Yu concluded his essay on the history of money in China with Ch'iu Chlin's bit-
ing critique of paper money in the Sung and Ylian because he was convinced
that Chiu's analysis was correct and should be kept in mind in planning a cur-
rency policy for Korea in the mid-seventeenth century. Whereas previous writ-
ers had distinguished between products of utility like grain and cloth because
they could be consumed with some benefit to the consumer, Ch'iu shifted the
focus of value to the role of labor and skill in the act of production. Presumably
he meant that only metallic cash, which required both effort and skill in the mint-
ing process, could constitute something of value that could then function as a
medium of exchange.
Was there, however, any justification for Ch'iu Chlin's bias against both mul-
tiple denomination metallic cash and paper money specifically on the grounds
that issuing money at a far greater nominal value than the cost of the raw mate-
rials, labor, and skill required to make the money itself constituted a profiteer-
ing and exploitative deception of an unwitting general population? Ch'iu
believed that money had a proper function as a medium of exchange to lubri-
cate the flow of goods, but that it should never be used by either private citizens
or rulers to make profits. He thought that past experience had demonstrated that
the public lost confidence in both multiple denomination cash and paper money,
and as a result the value of the money deteriorated along with rampant inflation
in prices.
Some traditional experts on money like Liu Chih ofT'ang times had realized
that there was or might have been some connection between the volume of money
in circulation and the amount of commodities for sale in the market, and some
had in fact asked whether changes in the value of money or fluctuation in com-
modity prices were caused by demand or supply. It had become common knowl-
edge that no matter what the media of exchange, prices of agricultural goods
shifted markedly between periods of glut and scarcity caused by changing
weather conditions. Some observers had noted that from the T'ang period on
there were periods when the value of cash increased not only as a result of a
surplus of agricultural production, but also because of a shortage of the supply
of cash itself, and merchants and other private individuals had no difficulty in