Money, Banks and Finance in Economic Thought

Walter Bagehot's 'Depreciation of Silver': a pamphlet on currency and India

Biets Jordan, Université Lumière Lyon 2

Depreciation of Silver is a collection of seventeen articles written by the British economist Walter Bagehot (1826-1877) and published in The Economist between February and December 1876. Written at the height of Bagehot’s notoriety, they remain unnoticed by the literature while they reveal his interest for the question of silver and the debate for changing the Indian monetary regime in 1876. The reading of the Depreciation of Silver, which Bagehot agreed to consider as a pamphlet, provides valuable insights into his monetary thought and his perception of the Indian colony. Emphasising the silver crisis context of the year 1876, the present paper proposes an interpretation of Bagehot's rhetoric in The Economist, with peculiar attention to India. The analysis of his pro-silver and anti-gold arguments for the colony highlights two salient features: on the one hand it uncovers Bagehot’s faithful advocacy of the British monetary orthodoxy of the 1870s; on the other hand, it reveals his singular "anti-imperial" view. These two counter-intuitive interpretations find their explanation in British stakes tied up with the Indian monetary system of that time. In examining this pamphlet, I defend the idea that, during a crucial time of India’s monetary history, Bagehot’s editorship of The Economist embodied an anti-gold lobby for the colony in order to defend the stability of the British economy.


Keywords: silver question, India, Walter Bagehot, The Economist, imperialism

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