OF

POLITICAL ECONOMY

WITH

SOME OF THEIR APPLICATIONS TO SOCIAL PHILOSOPHY,

BY

JOHN STUART MILL.

IN TWO VOLUMES.

VOL. II.

FROM THE FIFTH LONDON EDITION.

NEW YORK:

D. APPLETON AND COMPANY,

1, 3, AND 5 BOND STREET.

1882.

HARVARD UNIVERSITY LIBRARY

CONTENTS

OF THE SECOND VOLUME.

BOOK III.

EXCHANGE.-(Continued.)

CHAPTER VII. Of Money.

1. Purposes of a Circulating Medium,

2. Gold and Silver, why fitted for those purposes,

3. Money a mere contrivance for facilitating exchanges, which

does not affect the laws of Value,

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CHAPTER VIII. Of the Value of Money, as dependent on

Demand and Supply.

1. Value of Money, an ambiguous expression, .

2. The Value of Money depends, cæteris paribus, on its quantity,

3.

together with the rapidity of circulation,

4. Explanations and limitations of this principle,

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26

31

33

CHAPTER IX. Of the Value of Money, as dependent on

Cost of Production.

1. The Value of money, in a state of freedom, conforms to the

value of the bullion contained in it, .

2. which is determined by the cost of production,

3. This law, how related to the principle laid down in the pre-

ceding chapter,

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40

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CHAPTER X. Of a Double Standard, and Subsidiary Coins.

1. Objections to a double standard,

2. The use of the two metals as money, how obtained without

making both of them legal tender,

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CHAPTER XI. Of Credit, as a Substitute for Money.

§ 1. Credit not a creation but a transfer of the means of produc-

tion,.

2. In what manner it assists production,

3. Function of credit in economizing the use of money,

4. Bills of exchange, .

5. Promissory notes,.

6. Deposits and cheques,

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51

53

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60

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CHAPTER XII. Influence of Credit on Prices.

1. The influence of bank notes, bills, and cheques, on price, a
part of the influence of Credit, .

2. Credit a purchasing power similar to money,

3. Effects of great extensions and contractions of credit. Phe-
nomena of a commercial crisis analyzed,

4. Bills a more powerful instrument for acting on prices than
book credits, and bank notes than bills,

5. the distinction of little practical importance,

-

ful with bank notes,.

6. Cheques an instrument for acting on prices, equally power-

7. Are bank notes money?

8. No generic distinction between bank notes and other forms

of credit,

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CHAPTER XIII. Of an Inconvertible Paper Currency.

1. The value of an inconvertible paper, depending on its quan-
tity, is a matter of arbitrary regulation,

2. If regulated by the price of bullion, an inconvertible cur-
rency might be safe, but not expedient,

3. Examination of the doctrine that an inconvertible currency
is safe if representing actual property,