Money, Economy, and Polity in the Daoguang-Era Paper Currency Debates

Over the course of the Daoguang reign, the Qing Empire experienced a net outflow of between one and one-and-a-half million yuanof silver due to its maritime trade with the West, largely in payment for opium. The results included destabilization of the domestic currency market, a general deflation of commodity prices, declines in production, increased unemployment, displacement of the labor force, rising land tax burdens, and, some argue, a rapid spike in economic inequality. These problems, and their connection to the outflow of silver, were widely recognized by scholars of the day.

In the 1830s an otherwise obscure Jiangnanliteratus named Wang Liu energetically circulated a series of draft proposals to resolve this problem through the issuance of paper currency, eventually publishing his detailed ideas on this subject in an 1837 book Qianbichuyan(Modest Proposals on Coin and Currency). Despite what most contemporaries took to be the disastrous history of such experiments in the empire’s past, Wang’s proposals elicited considerable debate among a wide circle of politicallyactive scholars, including most importantly the venerated “statecraft” polymath BaoShichen.

This paper seeks, through close reading of Wang’s and Bao’s writings on this subject, to explore Daoguang-era thinking on such questions as the operation of the economy, the possibility of shaping that economy through government policy, the role of maritime trade and relations with European trade partners, and the nature of the Qing polity itself.