177.  Every person in a civilized country requires, according to his station in life, the use of a certain quantity of money, to make the ordinary purchases of the articles which he consumes.  The same individual pieces of coin, it is true, circulate again and again, in the same district:  the identical piece of silver, received by the workman on Saturday night, passing through the hands of the butcher, the baker, and the small tradesman, is, perhaps, given by the latter to the manufacturer in exchange for his check, and is again paid into the hands of the workman at the end of the succeeding week.  Any deficiency in this supply of money is attended with considerable inconvenience to all parties.  If it be only in the smaller coins, the first effect is a difficulty in procuring small change; then a disposition in the shopkeepers to refuse change unless a purchase to a certain amount be made; and, finally, a premium in money will be given for changing the larger denominations of coin.

Thus money itself varies in price, when measured by other money in larger masses:  and this effect takes place whether the circulating medium is metallic or of paper.  These effects have constantly occurred, and particularly during the late war; and, in order to relieve it, silver tokens for various sums were issued by the Bank of England.

The inconvenience and loss arising from a deficiency of small money fall with greatest weight on the classes whose means are least; for the wealthier buyers can readily procure credit for their small purchases, until their bill amounts to one of the larger coins.

178.  As money, when kept in a drawer, produces nothing, few people, in any situation of life, will keep, either in coin or in notes, more than is immediately necessary for their use; when, therefore, there are no profitable modes of employing money, a superabundance of paper will return to the source from whence it issued, and an excess of coin will be converted into bullion and exported.

179.  Since the worth of all property is measured by money, it is obviously conducive to the general welfare of the community, that fluctuations in its value should be rendered as small and as gradual as possible.

The evils which result from sudden changes in the value of money will perhaps become more sensible, if we trace their effects in particular instances.  Assuming, as we are quite at liberty to do, an extreme case, let us suppose three persons, each possessing a hundred pounds:  one of these, a widow advanced in years, and who, by the advice of her friends, purchases with that sum an annuity of twenty pounds a year during her life:  and let the two others be workmen, who, by industry and economy, have each saved a hundred pounds out of their wages; both these latter persons proposing to procure machines for calendering, and to commence that business.  One of these invests his money in a savings’ bank; intending to make