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Variable Measurement Units and Flexibility

August 3rd, 2011
history, money  [html]

In feudal france everything was sticky. Wages, tithes, and the price of bread were all fixed by tradition, and changing amounts was politically impossible. Instead, when for various reasons (market fluctuations, wars, greed) people wanted to change amounts, they would alter units of measurement. For example if flour became more expensive, bakers knew they could not adjust the price of a loaf of bread without provoking a riot, but they could make the loaves lighter and make them bigger and fluffier to compensate. This was hugely political and controversial, with people generally being aware of what was going on, but it was common. It was probably the main force leading to varying definitions of measurement units by the same name in different places.

The introduction of standardized measurement units was politically unpopular at the local level because it removed this flexibility. Once the size of a bushel was fixed, a lord could no longer increase tithes by requiring payment in larger baskets. [1] I think this is partly why greece is in such a bad position now. They accepted a more standardized measurement unit for money, the euro, and now when they are in a crisis where the traditional response is to use inflation to decrease debts they don't have that option.

When measurement units became inflexible, after a period of adjustment people learned that prices and amounts needed to be flexible. Bread could become more expensive, taxes could be cut or raised. Perhaps we need to learn to do this with money. We really don't like it when people don't pay back money borrowed, but inflating away debts is basically the same thing. So maybe we need to be more open to debt modification somehow?

[1] this all comes from p27-29 of "seeing like a state" by james scott

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