Working Paper: CEPR ID: DP14023
Authors: Jacques Melitz; Anthony Edo
Abstract: We perform the first econometric test to date of the influences of inflows of precious metals and population growth on the “Great Inflation” in Europe following the discov-ery of the New World. The English evidence strongly supports the near-equivalent im-portance of both influences. For 1500-1700, silver is the only relevant precious metal in the estimates. The study controls for urbanization, government spending, mortality crises and climatic changes. The series for inflows of the precious metals into Europe from America and European mining are newly constructed based on the secondary sources.
Keywords: The Great Inflation; Demography; Precious Metals; European Economic History 1500-1700
JEL Codes: E31; F00; J10; N13; N33
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| inflows of precious metals (N13) | inflation (E31) |
| population growth (J11) | inflation (E31) |
| inflows of precious metals and population growth (N11) | inflation (E31) |
| urbanization (R11) | inflation (E31) |
| government spending (H59) | inflation (E31) |
| mortality crises (H12) | inflation (E31) |
| climatic changes (Q54) | inflation (E31) |