De-Monetisation of Copper
Never mind the supposed ‘re-monetisation’ of gold, what about the de-monetisation of copper. The price of copper is now so high that the copper content of small denomination coins may now exceed their face value. Larry White points to the case of Korea, which is suffering from reverse seignorage:
The production cost of a W10 coin is about W40, W14 of that for copper and zinc alone.
Australian coins are 75-92% copper, although we wisely took smaller denomination coins out of circulation years ago.
posted on 10 February 2006 by skirchner in Economics
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