912 FINANCIAL REFORM AND THE ECONOMYsuccessful circulation throughout the country, and he estimated the optimum
volume of cash according to the total annual revenues from total or annual taxes,
which he concluded was approximately four or five million kok (40-50 million
mal because his kok consisted of ro mal, or 2.7-3.3 million contemporary sam
of grain). Unfortunately, he did not explain the basis for his estimate of total
standard tax revenue, but in his chapter on government expenditures for the sup-
port of the government after he had cut several costs from the current budget,
he estimated a total expenditure of 1,248,267 sam, or 18,724,005 mal (at 15 mal
per sam).5^1 This amount also had to represent the total tax revenue in his reformed
system of government, but the estimate of 40-50 million mal (2.7-3.3 million
contemporary sam) in this chapter was over twice his estimate for total national
expenditures.
A rough estimate of contemporary national revenues might yield a figure closer
to his estimate of regular national tax income. If a liberal 300,000 sam per annum
were estimated for the land tax, and another five times that amount for the tae-
dong tribute tax and all illict surcharges, it would total 1.8 million sam. If the
equivalent of the cloth support tax for military service was estimated at I mil-
lion p'il of cloth (presumably 2 p'i/ on the average for 500,000 taxpayers), at
Yu's proposed exchange rate of 6 mal/p 'il, the amount would come to 3,000,000
mal or 200,000 sam, bringing the national total to 2. I million sam, still 28 to
33 percent less than his estimate.
In any case, he believed that roo,ooo to 200,000 strings of cash (roo to 200
million coins at 1,000 coins per string) would supply enough cash for the econ-
omy, and if 7 to 8 million strings (7 to 8 billion coins) could be minted, there
would never ever be any further need to mint more cashY If his estimate of 40
to 50 million mal for national tax revenues was correct, it would require 800
million to I billion coins (at a conversion rate of 20 munlmal). He only hoped,
however, to convert one-third tax revenues to cash, and at the beginning of the
campaign he would have settled for ro or 20 percent. In other words, he would
have settled for either 80 to 100 million or 160 to 200 million coins at the ini-
tial stage, and 267 million coins eventually, to convert one-third tax revenues to
cash payments. Therefore, his call for roo to 200 million coins would in fact
have matched hi s goal for converting 10 to 20 percent of his estimated national
tax revenues to cash, but his figure of 7 to 8 billion coins for total conversion of
all taxes to cash was exaggerated by a factor of three decimal points, possibly
a typographical error in the texts^3
If he had also estimated the velocity of cash transactions, he might have been
able to reduce the money supply necessary for the successful introduction of
cash into the economy to some fraction of 800 million to I billion coins. In fact,
his estimate of replacing one-third national tax revenues, or 267 million coins
by his figures, might in fact have represented an optimum amount.
Kwon Yong'ik has justifiably concluded that Yu's estimate of 7 to 8 million
strings for the money supply was astronomical by comparison with the money
supply/GNP ratio he found in South Korea in 1974. Both he and Won Yuhan