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'''Flying cash''' ({{zh|t=飛錢}}), or '''''Feipiao''''', was a type of paper [[negotiable instrument]] used during China's [[Tang dynasty]] invented by merchants but adopted by the state. Its name came from their ability to transfer cash across vast distances without physically transporting it.<ref name="Yang">{{cite book |last1=Yang |first1=Lien-sheng |title=Money and Credit in China |date=1971 |publisher=Harvard University Press |location=Cambridge, Massachusetts |isbn=0-674-58300-0 |pages=51–52 |edition=2nd |ref=Yang}}</ref> It is a precursor to true [[banknotes]] which appeared during the [[Economy of the Song dynasty#Innovations in commerce|Song dynasty]].
'''Flying cash''' ({{zh|t=飛錢}}), or '''''Feipiao''''', was a type of paper [[negotiable instrument]] used during China's [[Tang dynasty]] invented by merchants but adopted by the state. Its name came from their ability to transfer cash across vast distances without physically transporting it.<ref name="Yang">{{cite book |last1=Yang |first1=Lien-sheng |title=Money and Credit in China |date=1971 |publisher=Harvard University Press |location=Cambridge, Massachusetts |isbn=0-674-58300-0 |pages=51–52 |edition=2nd |ref=Yang}}</ref> It is a precursor to true [[banknotes]] which appeared during the [[Economy of the Song dynasty#Innovations in commerce|Song dynasty]].


According to the ''[[New Book of Tang]]'', in the year 804, merchants were using flying cash.<ref name="Inner Mongolian">{{cite book |last1=Inner Mongolian Numismatic Research Institute |title=A Compilation of Pictures of Chinese Ancient Paper Money |date=1992 |publisher=The China Finance Publishing House |location=Beijing |isbn=7-5049-0861-4 |page=3 |edition=Bilingual |ref=Inner Mongolian}}</ref><ref>{{cite web |last1=Ouyang |first1=Xiu |title=New Book of Tang |url=http://chinesenotes.com/xintangshu/xintangshu054.html |website=Chinese Notes |access-date=31 July 2019}}</ref> Between 805 and 820 there was a shortage of [[Cash (Chinese coin)|copper cash coins]] which proved to be a hindrance for daily business transactions in the Tang dynasty. The creation of the flying cash happened after a tax reform that allowed for the partial acceptance of taxes in money, which had increased the demand for currency which scared the government that merchants would remove cash coins from the capital to circulate so they ordered the local governments to set up monetary systems based on silk, other fabrics, and daily items akin to [[barter]] which hampered long-distance trade in the Tang dynasty and harmed the national economy. The people that had the largest benefit from the introduction of flying cash were tea merchants and these merchant helped improve the trade between the capital and the regions.
According to the ''[[New Book of Tang]]'', in the year 804, merchants were using flying cash.<ref name="Inner Mongolian">{{cite book |last1=Inner Mongolian Numismatic Research Institute |title=A Compilation of Pictures of Chinese Ancient Paper Money |date=1992 |publisher=The China Finance Publishing House |location=Beijing |isbn=7-5049-0861-4 |page=3 |edition=Bilingual |ref=Inner Mongolian}}</ref><ref>{{cite web |last1=Ouyang |first1=Xiu |title=New Book of Tang |url=http://chinesenotes.com/xintangshu/xintangshu054.html |website=Chinese Notes |access-date=31 July 2019}}</ref> Between 805 and 820 there was a shortage of [[Cash (Chinese coin)|copper cash coins]] which proved to be a hindrance for daily business transactions in the Tang dynasty. The creation of the flying cash happened after a tax reform that allowed for the partial acceptance of taxes in money, which had increased the demand for currency which scared the government that merchants would remove cash coins from the capital to circulate so they ordered the local governments to set up monetary systems based on silk, other fabrics, and daily items akin to [[barter]] which hampered long-distance trade in the Tang dynasty and harmed the national economy. The people that had the largest benefit from the introduction of flying cash were tea merchants and these merchants helped improve the trade between the capital and the regions.


Originally the government of the Tang dynasty was less than receptive to the idea of bills of exchange and had attempted banning them on multiple occasions, but in 812 flying cash were officially accepted as a valid means of exchange. After the government had accepted these bills the supervision of flying cash was handled by the [[Ministry of Revenue (imperial China)|Ministry of Revenue (戶部)]], the Tax Bureau (度支司), and the [[Salt Commission|Salt Monopoly Bureau (鹽錢司)]]. The state began printing their own notes. Flying cash would remain in use until the early period of the [[Song dynasty]].<ref name=Theobald>{{cite encyclopedia|url= http://chinaknowledge.de/History/Terms/feiqian.html|title= feiqian 飛錢, bills of exchange.|date= 10 May 2016|access-date=6 February 2018|encyclopedia= 2000 ff. © Ulrich Theobald - ChinaKnowledge.de - An Encyclopaedia on Chinese History, Literature and Art|language=en}}</ref>
Originally the government of the Tang dynasty was less than receptive to the idea of bills of exchange and had attempted banning them on multiple occasions, but in 812 flying cash were officially accepted as a valid means of exchange. After the government had accepted these bills the supervision of flying cash was handled by the [[Ministry of Revenue (imperial China)|Ministry of Revenue (戶部)]], the Tax Bureau (度支司), and the [[Salt Commission|Salt Monopoly Bureau (鹽錢司)]]. The state began printing their own notes. Flying cash would remain in use until the early period of the [[Song dynasty]].<ref name=Theobald>{{cite encyclopedia|url= http://chinaknowledge.de/History/Terms/feiqian.html|title= feiqian 飛錢, bills of exchange.|date= 10 May 2016|access-date=6 February 2018|encyclopedia= 2000 ff. © Ulrich Theobald - ChinaKnowledge.de - An Encyclopaedia on Chinese History, Literature and Art|language=en}}</ref>


== Origin ==
== Origin ==
Between the years 618 and 758 the [[Salt in Chinese history|Chinese salt monopoly]] was controlled by local governments as opposed to the imperial government, this system was known as the ''Kaizhong policy'', the local governments didn't produce the salt themselves but taxed it.<ref name="AcademiaPiaohaoMorckYang">{{cite web|url= https://www.academia.edu/11901191|title= The Shanxi Banks.|date=12 April 2010|access-date=31 October 2019|author= Randall Morck ([[University of Alberta]] - Department of Finance and Statistical Analysis; National Bureau of Economic Research (NBER); European Corporate Governance Institute; Asian Bureau of Finance and Economic Research) & Fan Yang ([[University of Saskatchewan]])|publisher= [[Academia.edu]]|language=en}}</ref> In the year 758 the government official [[Liu Yan (Tang dynasty)|Liu Yan]] had convinced the imperial government to actively enforce its salt monopoly again. This was known as the ''Zhece policy''.<ref name="AcademiaPiaohaoMorckYang"/> Under the ''Zhece policy'' Chinese merchants were paid in salt certificates in exchange for supplying the [[Military history of the Sui–Tang dynasties|frontier armies]] directly as opposed to transporting government provisions to them.<ref name="AcademiaPiaohaoMorckYang"/> During the reign of the [[Emperor Xianzong of Tang|Emperor Xianzong]] the supply of [[Cash (Chinese coin)|cash coins]] in circulation was scarce and when Chinese merchants would travel to the capital city, the merchants would entrust their money to the representative offices of their local governments, to the various armies of the Tang dynasty, government commissioners, and local rich families.<ref name="AcademiaPiaohaoMorckYang"/> The merchants did this to lighten their traveling burdens as they would hurry away in all directions.<ref name="AcademiaPiaohaoMorckYang"/> When the tallies were matched at a local office, they could withdraw their money.<ref name="AcademiaPiaohaoMorckYang"/>
Between the years 618 and 758 the [[Salt in Chinese history|Chinese salt monopoly]] was controlled by local governments as opposed to the imperial government, this system was known as the ''Kaizhong policy'', the local governments didn't produce the salt themselves but taxed it.<ref name="AcademiaPiaohaoMorckYang">{{cite web|url= https://www.academia.edu/11901191|title= The Shanxi Banks.|date=12 April 2010|access-date=31 October 2019|author= Randall Morck ([[University of Alberta]] - Department of Finance and Statistical Analysis; National Bureau of Economic Research (NBER); European Corporate Governance Institute; Asian Bureau of Finance and Economic Research) & Fan Yang ([[University of Saskatchewan]])|publisher= [[Academia.edu]]|language=en}}</ref> In the year 758 the government official [[Liu Yan (Tang dynasty)|Liu Yan]] had convinced the imperial government to actively enforce its salt monopoly again. This was known as the ''Zhece policy''.<ref name="AcademiaPiaohaoMorckYang"/> Under the ''Zhece policy'' Chinese merchants were paid in salt certificates in exchange for supplying the [[Military history of the Tang dynasty|frontier armies]] directly as opposed to transporting government provisions to them.<ref name="AcademiaPiaohaoMorckYang"/> During the reign of the [[Emperor Xianzong of Tang|Emperor Xianzong]] the supply of [[Cash (Chinese coin)|cash coins]] in circulation was scarce and when Chinese merchants would travel to the capital city, the merchants would entrust their money to the representative offices of their local governments, to the various armies of the Tang dynasty, government commissioners, and local rich families.<ref name="AcademiaPiaohaoMorckYang"/> The merchants did this to lighten their traveling burdens as they would hurry away in all directions.<ref name="AcademiaPiaohaoMorckYang"/> When the tallies were matched at a local office, they could withdraw their money.<ref name="AcademiaPiaohaoMorckYang"/>


== Use ==
== Use ==


Flying cash was never originally meant to be used as [[legal tender]] and, therefore, their circulation was limited. However, since they could be exchanged for hard currency at the capital with an exchange fee of 100 ''[[Chinese cash (currency unit)|wén]]'' per 1000 ''wén'', they were traded amongst merchants as if they were currency. Flying cash continued to be used in the Five Dynasties era into the beginning of the Song Dynasty in 960.<ref>
Flying cash was never originally meant to be used as [[legal tender]] and, therefore, their circulation was limited. However, since they could be exchanged for hard currency at the capital with an exchange fee of 100 ''[[Chinese cash (currency unit)|wén]]'' per 1000 ''wén'', they were traded amongst merchants as if they were currency. Flying cash continued to be used in the [[Five Dynasties and Ten Kingdoms period|Five Dynasties]] era into the beginning of the Song Dynasty in 960.{{cn|date=November 2022}}
https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.673.8833&rep=rep1&type=pdf
</ref>


It was not until the [[Song dynasty]] and subsequent [[Jin dynasty (1115–1234)|Jin]] occupation that paper money was officially established as a legal tender. Eventually, the Song Dynasty began to issue more notes to pay its bills- a practice that ultimately contributed to runaway inflation.<ref name=":0">{{Cite book|title = Worlds Together Worlds Apart|last = Pollard|first = Elizabeth|publisher = W.W. Norton & Company|year = 2015|isbn = 978-0-393-92207-3|pages = 352}}</ref>
It was not until the [[Song dynasty]] and subsequent [[Jin dynasty (1115–1234)|Jin]] occupation that paper money was officially established as a legal tender. Eventually, the Song Dynasty began to issue more notes to pay its bills- a practice that ultimately contributed to runaway inflation.<ref name=":0">{{Cite book|title = Worlds Together Worlds Apart|last = Pollard|first = Elizabeth|publisher = W.W. Norton & Company|year = 2015|isbn = 978-0-393-92207-3|pages = 352}}</ref>

Latest revision as of 03:20, 15 February 2024

Flying cash (Chinese: 飛錢), or Feipiao, was a type of paper negotiable instrument used during China's Tang dynasty invented by merchants but adopted by the state. Its name came from their ability to transfer cash across vast distances without physically transporting it.[1] It is a precursor to true banknotes which appeared during the Song dynasty.

According to the New Book of Tang, in the year 804, merchants were using flying cash.[2][3] Between 805 and 820 there was a shortage of copper cash coins which proved to be a hindrance for daily business transactions in the Tang dynasty. The creation of the flying cash happened after a tax reform that allowed for the partial acceptance of taxes in money, which had increased the demand for currency which scared the government that merchants would remove cash coins from the capital to circulate so they ordered the local governments to set up monetary systems based on silk, other fabrics, and daily items akin to barter which hampered long-distance trade in the Tang dynasty and harmed the national economy. The people that had the largest benefit from the introduction of flying cash were tea merchants and these merchants helped improve the trade between the capital and the regions.

Originally the government of the Tang dynasty was less than receptive to the idea of bills of exchange and had attempted banning them on multiple occasions, but in 812 flying cash were officially accepted as a valid means of exchange. After the government had accepted these bills the supervision of flying cash was handled by the Ministry of Revenue (戶部), the Tax Bureau (度支司), and the Salt Monopoly Bureau (鹽錢司). The state began printing their own notes. Flying cash would remain in use until the early period of the Song dynasty.[4]

Origin

[edit]

Between the years 618 and 758 the Chinese salt monopoly was controlled by local governments as opposed to the imperial government, this system was known as the Kaizhong policy, the local governments didn't produce the salt themselves but taxed it.[5] In the year 758 the government official Liu Yan had convinced the imperial government to actively enforce its salt monopoly again. This was known as the Zhece policy.[5] Under the Zhece policy Chinese merchants were paid in salt certificates in exchange for supplying the frontier armies directly as opposed to transporting government provisions to them.[5] During the reign of the Emperor Xianzong the supply of cash coins in circulation was scarce and when Chinese merchants would travel to the capital city, the merchants would entrust their money to the representative offices of their local governments, to the various armies of the Tang dynasty, government commissioners, and local rich families.[5] The merchants did this to lighten their traveling burdens as they would hurry away in all directions.[5] When the tallies were matched at a local office, they could withdraw their money.[5]

Use

[edit]

Flying cash was never originally meant to be used as legal tender and, therefore, their circulation was limited. However, since they could be exchanged for hard currency at the capital with an exchange fee of 100 wén per 1000 wén, they were traded amongst merchants as if they were currency. Flying cash continued to be used in the Five Dynasties era into the beginning of the Song Dynasty in 960.[citation needed]

It was not until the Song dynasty and subsequent Jin occupation that paper money was officially established as a legal tender. Eventually, the Song Dynasty began to issue more notes to pay its bills- a practice that ultimately contributed to runaway inflation.[6]

See also

[edit]

References

[edit]
  1. ^ Yang, Lien-sheng (1971). Money and Credit in China (2nd ed.). Cambridge, Massachusetts: Harvard University Press. pp. 51–52. ISBN 0-674-58300-0.
  2. ^ Inner Mongolian Numismatic Research Institute (1992). A Compilation of Pictures of Chinese Ancient Paper Money (Bilingual ed.). Beijing: The China Finance Publishing House. p. 3. ISBN 7-5049-0861-4.
  3. ^ Ouyang, Xiu. "New Book of Tang". Chinese Notes. Retrieved 31 July 2019.
  4. ^ "feiqian 飛錢, bills of exchange.". 2000 ff. © Ulrich Theobald - ChinaKnowledge.de - An Encyclopaedia on Chinese History, Literature and Art. 10 May 2016. Retrieved 6 February 2018.
  5. ^ a b c d e f Randall Morck (University of Alberta - Department of Finance and Statistical Analysis; National Bureau of Economic Research (NBER); European Corporate Governance Institute; Asian Bureau of Finance and Economic Research) & Fan Yang (University of Saskatchewan) (12 April 2010). "The Shanxi Banks". Academia.edu. Retrieved 31 October 2019.{{cite web}}: CS1 maint: multiple names: authors list (link)
  6. ^ Pollard, Elizabeth (2015). Worlds Together Worlds Apart. W.W. Norton & Company. p. 352. ISBN 978-0-393-92207-3.

Sources

[edit]
  • Kang Guohong (康國宏) (1997). "Feiqian (飛錢)", in Men Kui (門巋), Zhang Yanqin (張燕瑾), ed. Zhonghua guocui da cidian (中華國粹大辭典) (Xianggang: Guoji wenhua chuban gongsi), 104. (in Chinese)
  • Yao Enquan (姚恩權) (1993). "Feiqian (飛錢)", in Shi Quanchang 石泉長, ed. Zhonghua baike yaolan (中華百科要覽) (Shenyang: Liaoning renmin chubanshe), 85. (in Chinese)
  • Zhou Fazeng (周發增), Chen Longtao (陳隆濤), Qi Jixiang (齊吉祥), ed. (1998). Zhongguo gudai zhengzhi zhidu shi cidian (中國古代政治制度史辭典) (Beijing: Shoudu shifan daxue chubanshe), 362. (in Chinese)
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