monetary system in which the standard economic unit of account is based on a fixed quantity of gold
A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold.
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- Belief in the gold standard was the faith of the age. With some it was a naive, with some a critical, with others a satanistic creed implying acceptance in the flesh and rejection in the spirit. Yet the belief itself was the same, namely, that banknotes have value because they represent gold. Whether the gold itself has value for the reason that it embodies labor, as the socialists held, or for the reason that it is useful and scarce, as the orthodox doctrine ran, made for once no difference.
- Karl Polanyi, The Great Transformation (1944), Ch. 2 : Conservative Twenties, Revolutionary Thirties