THE SILVER STANDARD AND THE DISLOCATION OF ITS PARITY 405
argument from relative over-supply sufficient to account for the fall in the gold value of silver ? On the face of it, the explanation has the plausibility of a simple proposition. It is one of the elementary theorems of political economy that the value of a thing varies inversely with its supply, and if the supply of silver had largely increased, what could be more natural than that its value in terms of gold should fall ? The following were the relevant facts which formed the basis of the argument:—
TABLE X
G OLD AND S ILVER -
R ELATIVE P RODUCTION AND R ELATIVE V ALUE
| Period | Ratio of Produc- tion (by Weight) of Gold to Silver As 1 Grain to: | Ratio of value of Gold to Silver As 1 Grain to | Index Number for the Ratio of Produc- tion | Index Number for the Ratio of Value | Correlation between Relative Production and Relative Value | Col7 |
|---|---|---|---|---|---|---|
| Relative Produc- tion of Silver Falls — Rises+ | Relative Value of Silver Falls — Rises+ | |||||
| 1681-1700 1701-1720 1721-1740 1741-1760 1761-1780 1781-1800 1801-1810 1811-1820 1821-1830 1831-1840 1841-1850 1851-1855 1856-1860 1861-1865 1866-1870 1871-1875 1876-1880 1881-1886 1886-1890 1891-1895 | 31.8 27.7 22.6 21.7 31.5 49.4 50.3 47.2 32.4 29.4 14.2 4.4 4.5 5.9 6.9 11.3 13.2 17.3 19.9 20.0 | 14.95 15.21 15.10 14.70 14.40 15.08 15.67 15.68 15.82 15.77 15.81 15.45 15.28 15.42 15.52 16,10 17.79 18.81 20.98 26.75 | 100 87 71 67 99 155.6 158.0 148.0 101.9 92.4 44.6 13.8 14.0 18.55 21.7 35.5 41.5 54.4 62.6 62.9 | 100 101.7 101 98.3 96.3 100.8 104.8 104.9 105.8 105.4 105.8 103.3 102.2 103.1 103.8 107.6 119.0 125.8 140.3 178.9 | . . . –13 – 29 –33 – 1 +55.6 +58.0 +48.0 +1.9 –7.6 –55.4 –86.2 –86.0 –81.5 –78.3 –64.5 –58.5 –45.6 –37.4 –37.1 | . . . –1.7 –1.0 +1.7 +3.7 –.8 –4.8 –4.9 –5.8 –5.4 –5.8 –3.3 –2.2 –3.1 –3.8 –7.6 –19.0 – 25.8 –40.3 –78.9 |
- The table is based on figures of M. de Foville of the French Mint, as given by Mr. F. B. Forbes in The Bimetallist of July, 1897, pp. 125-28.