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I would like to build a graph for the price of a loaf of bread based on exchange of silver. My research has shown that some items or commodities have remained very consistent when priced against other commodities. A cow ready for slaughter for one ounce of gold, for example. Obviously there are some historical aberrations to this but usually because of other influences, war, famine or drought as examples. But otherwise these relations hold long term. The reason or need for this graph is to show that only fiat or paper currency suffers from inflation, with the only exception that I know of being Spain, a gold and silver based economy, after conquering the "new world" and bringing home too much gold. Ultimately what I am looking for are historical quotes for the amount paid with dates and, hopefully location. Thanks in advance.

Semaphore
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Coffee House Philosopher
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  • The price of bread where? This is more an economics questions than history. – Tyler Durden Mar 16 '15 at 04:05
  • It is probably better to limit this question a little geographically. Also, commodity money suffered from inflation all the time too - just lower and punctuated with great short term fluctuations in prices. – Semaphore Mar 16 '15 at 04:07
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    You may be interested in reading my answer to the question at http://history.stackexchange.com/questions/14847/how-can-prices-be-compared-over-time/14849#14849 – Tyler Durden Mar 16 '15 at 04:07
  • Another exception might be California during the Gold Rush, when various commodities were expensive compared to gold. (Locally, of course: the price of something in New York or Chicago could be much different than in San Francisco.) Or you could look at the fluctuations in gold prices over the last 20-30 years. – jamesqf Mar 16 '15 at 05:09
  • I don't think the question itself worths -1. Probably it would need a little bit of improvement. Silver with Gold may not be the best measure for costs, but since it was used as currency all over the world, it can lead somewhere. Of course there are flaws, measuring everything in Silver alone isn't accurate, but might be good enough if you know an another factor, for example knowing how much did an uneducated worker earned in the era? That would help out, since Silver as a currency in the same time was commodity too, if it is plentiful, it worths less. – CsBalazsHungary Mar 16 '15 at 09:31
  • Further notice: As I already said, maybe a good guess would be to find out "how much bread could be bought out of a month's work of an uneducated worker". Probably both data could be obtained, both salaries and cost of bread too through ages and continents. – CsBalazsHungary Mar 16 '15 at 09:43
  • Coffee House Philosopher: I am interested in the question anyways, I wanted to research it myself too, if you want, please drop me a mail: csbalazs (at) online-factory (point) net – CsBalazsHungary Mar 16 '15 at 09:47
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    This is really just extremely broad. There's good data for, say, the price of bread in Britain for the last 500 years, but throughout all history, anywhere? There wouldn't even be any similarity between European and Chinese bread prices. As interesting as the topic is, H.SE questions should be reasonably scoped. – Semaphore Mar 16 '15 at 09:54
  • @Semaphore agree, it is very broad, and I would say you have a missed out point mentioning China: they didn't really eat bread, but rice back in time. So the topic is really valid, but needs big amout of research and summarization of data. – CsBalazsHungary Mar 16 '15 at 09:59
  • @CsBalazsHungary I know they ate rice, but that was the point - there's huge disparity across regions and even time periods due to cultural habits. The topic is valid, but the question is not precisely because it asks for too much. – Semaphore Mar 16 '15 at 10:43
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    When you finish this proof, can you prove that the sun orbits the earth? H:SE should not be used to support theories that have been conclusively disproven. – MCW Mar 16 '15 at 10:58
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    The purchasing power of silver will always be a function of 1) the supply of silver and 2) the productive capacities of civilization. To posit a 1-to-1 relationship between silver and cows is to posit some magical relationship between the two, as if the supply of silver were somehow sympathetically linked to the demand for cows. – two sheds Mar 16 '15 at 11:54
  • @MarkC.Wallace I don't see the proof of the opposite, I would appreciate to see a link on that. I mean Silver and Gold were currency for thousands of years, they sort of defined the value of a given thing in each era and geographical place. It can't be debated, however the accuracy can, and also extreme circumstances as mentioned: age of discovery, gold fever. – CsBalazsHungary Mar 16 '15 at 12:47
  • Every time that coinage was debased, specie currency was inflated. The fact that a foolish thing was done for thousands of years before it was known to be foolish is very weak evidence that a thing is not foolish. – MCW Mar 16 '15 at 13:34
  • @CsBalazsHungary: I agree that gold and silver defined the value of commodities in many eras and regions. But I don't think it follows from that fact that gold and silver serve as an absolute measure of value that allows for comparisons across eras and regions. – two sheds Mar 16 '15 at 14:05
  • @MarkC.Wallace Obviously the coinage was inflated, but if you check the historical examples, in late Roman empire for example silver coins were valuable, and started to have a price when the silver content of the regular coins decreased to few percent. I would never measure one silver coin to an another, but the silver content, and adding up silver availability. It is more complex topic, which could and maybe should be researched. – CsBalazsHungary Mar 16 '15 at 14:32
  • @twosheds comparasions are valid only if we know the available precious metal suppy, and other factors. For example a sample of earnings from each era. I suspect the amount of silver for a workday was somewhat similar to a late republican roman citizen and late empire citizen. The difference was that late empire citizen earned 60-70 relatively worthless coins each day, while late republican earned one, high silver content coin a day. – CsBalazsHungary Mar 16 '15 at 14:36
  • @CsBalazsHungary: IMO it's more complicated than that. Prices are emergent properties that measure the relative value of commodities actually exchangeable because they exist within the same market system. Comparing prices across market systems is nonsensical, because you'd have to imagine the two market systems merging and reaching a new equilibrium. Very limited comparisons are reasonable: e.g. how many cows could the average wage buy in 1860 Kansas vs. 1900 Kansas? These comparisons are meaningful, but so limited that we shouldn't mistake them as telling us much about the market in general – two sheds Mar 16 '15 at 14:48
  • ...and inasmuch as silver is another commodity exchangeable for goods, we can ask "how many cows does silver buy in 1860 Kansas versus 17th century France?"--but this cow/silver ratio won't be generally revealing about the French and Kansan price systems, only about the relative value of silver and cows in those eras and regions. – two sheds Mar 16 '15 at 14:50
  • @twosheds valid points, I had similar notifications here. That's why I am on the opinion it might be possible to determine the prices over ages, but it requires huge amount of research work. – CsBalazsHungary Mar 16 '15 at 14:59

1 Answers1

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This question is unanswerable:

1) Silver is not a useful measure on the scale required: money did not exist to purchase commodities for most of the desired time scale

2) Adequate wage/price series only become available in the mid 19th century, inadequate wage/price series only become available in the early 19th century

2a) Wage/price series are important because silver itself has a price, as discovered in the 19th century by a variety of political economics, Ricardo obviously, Marx gives a useful snapshot of the debate in Grundriesse's chapter on money. To establish some measure of stability, time series are constructed out of measures that appear to have some value over time: %GDP, GDP/capita, or "consumption bundles." Consumption bundles come down to wages through the relatively stable assumptions: workers consume their entire wages immediately or in deferred forms, the social expectations of waged consumption represent a social measure of "acceptable" living. Consumption bundles then give reference to prices in terms of a reflection on the socially accepted standard of living for people who worked for a living. This is fairly useful in that dietary habits don't actually change during crises (Hammond and Hammond's labourers series on the bread / oatmeal / potato consumption habits), which means that price rises in bread become apparent. Not useful in terms of dealing with fiat money, because again, our 19th century political economist friends identified that the paper money supply is a capital, not a domestic wage labourer, consumed commodity.

3) Bread was not bought for money for the vast majority of humanity through-out history, which gives a "no sensible answer" result

Samuel Russell
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  • I see no specific "desired time scale" in the question. 2) How is this objection relevant? 3) So what? Still such examples will be interesting for the places and times where bread could be bought with silver. Like the cities of ancient Greece and Roman empire. On my opinion, this is reasonable and interesting question.
    • – Alex Mar 16 '15 at 20:49
  • It is obviously "all of it." 2) I have amended the answer. 3) A society where bread isn't consumed as a commodity won't have a stable price. Athens was always its hinterland, Rome was always the latifunda and Egyptian fields.
    • – Samuel Russell Mar 16 '15 at 21:17