Jean Bodin (1530-1596) (19 abr 1530 ano – 19 abr 1596 ano)

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LIFE & CONTRIBUTIONS:
Jean Bodin was a French jurist and political theorist who is better known for his political theories. In economics, Bodin’s fame comes from being associated with the discovery of the quantity theory of money (although as mentioned earlier Copernicus had described the quantity theory of money in a letter written in 1522, and various other thinkers had also described the theory prior to Bodin’s work). Bodin lays out his version of the quantity theory of money in A Reply to the Paradoxes of M. Malestroit (1568). You can also find the theory reiterated in his Republic (aka The Six Books of the Commonwealth)(1576).

At the time of Bodin’s Reply…, prices across Europe were rising in a period of inflation now called the Price Revolution (the actual inflation rate during this period was around 1.5% per year, but this was very high for the time). Jean d. Malestroit (who was the official of Royal Accounts in France) had published his work, Paradoxes…, as an investigation into the general increase in prices, which he submitted to Charles IX. In this report, Malestroit provides a peculiar explanation. He claims that the value of coined money has changed due to debasement, but that the underlying relative value of all metals and commodities had not changed in 300 years. Malestroit asserted that this apparent paradox would seem a mystery to the general public, because monetary theory addresses obscure phenomena that few are able to decipher. Needless to say, Malestroit’s explanation was unsatisfactory for Bodin. In his response, Bodin recognizes that debasement can induce higher prices, but argues that debasement alone couldn’t explain the price phenomena they were witnessing. He then goes on to site five phenomena that could induce higher prices: monopoly, a relative scarcity of goods, debasement, wasteful spending by monarchs and nobility, and finally, a relative abundance of metal. The final cause is Bodin’s key insight. He suggests the chief cause of inflation is a relative abundance of the gold and silver people use to trade. Indeed, in 16th and 17th century Europe there had been a huge influx of metals from the Americas by way of Spain.

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