International bimetallism and silver absorption in Singapore, 1840–73

This study reveals the mechanism underlying the silver trade in Singapore during the third quarter of the nineteenth century by analysing banking business and bullion arbitrage. After 1849, the California Gold Rush induced gold depreciation and silver appreciation in Singapore's bullion market,...

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Bibliographic Details
Published inThe Economic history review Vol. 72; no. 2; pp. 595 - 617
Main Author Kobayashi, Atsushi
Format Journal Article
LanguageEnglish
Published Oxford Blackwell Publishing Ltd 01.05.2019
Subjects
19th century
Absorption
Appreciation
Arbitrage
Bullion
Commodities trading
Economic history
Foreign exchange rates
Imports
Profits
Silver
United Kingdom > UK
Netherlands
Singapore
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Summary:This study reveals the mechanism underlying the silver trade in Singapore during the third quarter of the nineteenth century by analysing banking business and bullion arbitrage. After 1849, the California Gold Rush induced gold depreciation and silver appreciation in Singapore's bullion market, and arbitrage profits for silver imports from Britain emerged. At the same time, the expansion of banking business by eastern exchange banks enhanced the connectivity of Singapore's exchange market with London, and enabled bullion arbitrage between the two distant cities. As a result, there was an influx of silver from Britain. In addition, Dutch silver, which was exported to Java by the Netherlands after 1854, flowed into Singapore due to the unfavourable exchange policy of the Dutch government.
Bibliography:This research was supported by Grant‐in‐Aid for JSPS Fellows 269047 and Suntory Foundation Research Support for Young Scholars 2014. The author owes thanks to three anonymous referees for many helpful comments and suggestions. The author is also very grateful to Kaoru Sugihara and Alejandra Irigoin for many helpful comments. The author is responsible for any errors.
ISSN:0013-0117
1468-0289
DOI:10.1111/ehr.12662