The 1520-1640 "great inflation": an early case of controversy on the nature of money

The causes of the "great inflation" of the sixteenth century have long been the subject of controversy. Since some major work in the 1930s, historians have argued over a "monetary" and a "real" interpretation. What we show in this paper is, first, that there was a dissenting opinion even then; second, that recent scholarship shows that the dissenters' view of events was probably the more accurate as to fact; third, that the monetary interpretation of the day drew intellectual support from a flawed source; and finally that the dissenters were mounting the earliest argument for the endogenous origins of money.