Editing Monetary policy (section)

=== Issuing coin===
Monetary policy has evolved over the centuries, along with the development of a money economy. Historians, economists, anthropologists and numismatics do not agree on the origins of money. In the West the common point of view is that coins were first used in [[ancient Lydia]] in the 8th century BCE, whereas some date the origins to [[ancient China]]. The earliest predecessors to monetary policy seem to be those of [[debasement]], where the government would melt coins down and mix them with cheaper metals. The practice was widespread in the late [[Roman Empire]], but reached its perfection in western Europe in the late [[Middle Ages]].<ref>Bordo, M.D. (2018). Monetary Policy, History of. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. Retrieved August 15, 2023.</ref>

For many centuries there were only two forms of monetary policy: altering coinage or the printing of [[paper money]]. [[Interest rates]], while now thought of as part of [[monetary authority]], were not generally coordinated with the other forms of monetary policy during this time. Monetary policy was considered as an executive decision, and was generally implemented by the authority with [[seigniorage]] (the power to coin). With the advent of larger trading networks came the ability to define the currency value in terms of gold or silver, and the price of the local currency in terms of foreign currencies. This official price could be enforced by law, even if it varied from the market price.
[[File:Hue-tzu (Song Dynasty government issue), 1023 - John E. Sandrock.jpg|left|thumb|Reproduction of a [[Song dynasty]] note, possibly a [[Jiaozi (currency)|Jiaozi]], redeemable for 770 ''mò'']]
Paper money originated from [[promissory notes]] termed "[[Jiaozi (currency)|jiaozi]]" in 7th-century [[China]]. Jiaozi did not replace metallic currency, and were used alongside the copper coins. The succeeding [[Yuan dynasty]] was the first government to use paper currency as the predominant circulating medium. In the later course of the dynasty, facing massive shortages of specie to fund war and maintain their rule, they began printing paper money without restrictions, resulting in [[hyperinflation]].