The gradual depreciation of national currencies in pursuit of fiscal and monetary goals, a practice inherited from the late medieval period, was a key feature of monetary policies so often pursued by states in early-modern Europe. Recent studies have highlighted the decisive importance of monetary objectives for these decisions. In 1988, Glassman and Redish, citing the experiences of England and France, contended that the successive depreciations carried out in early-modern Europe – either through enhancements or physical debasements of the currency – were designed to avoid the difficulties and costs generated by progressive undervaluations of the coinage. Meanwhile, the shortage of legal gold, silver and billon money itself created the conditions for this process, encouraging the parallel use of counterfeit and clipped coins. More recently, Sargent and Velde have argued that medieval and early-modern coinage debasements were essentially a rational defensive policy to remedy periodic shortages of ‘small change’, especially when circulating coins became worn over time. Given the need for petty coins in everyday transactions, these debasements were absolutely necessary to avoid economically damaging price deflation.

Both of these arguments implicitly assume the emergence of an ever more coherent monetary policy in the leading European states of this era. However, these states were still in the process of formation, and the authority of the monarch and government differed widely in the various territories under their control. The limited nature of royal power is revealed in the coexistence of two kinds of coins in many seventeenth-century states. Thus, the monarchy would usually issue the principal coinage associated with the state in the regions that were more directly under its control, and from which it obtained the majority of its tax revenues. Other subordinate regions, however, enjoyed greater political autonomy and a separate institutional framework, so that they conserved the right to issue their own domestic coinage, which usually coexisted in the market alongside the principal currency. In these states and regions, the monarchy had to negotiate its monetary policies, as it did its fiscal policies (taxes) with the local public institutions.