Author Topic: Denomination systems  (Read 31261 times)

0 Members and 1 Guest are viewing this topic.

Online Figleaf

  • Administrator
  • Honorary Member
  • *****
  • Posts: 31 539
Denomination systems
« on: March 21, 2012, 09:35:20 AM »
Are there 12 pence in a shilling?

In Britain there are.

Why did Britain issue Florins AND Half Crowns? Why did the U.S. issue 20 and 25 cent pieces?......

Half crowns go back to Henry VIII who had them for his wives, but the florin is mostly a Victorian invention. It was part of a futile attempt to decimalize, since a florin was 1/10th of a pound.

US coins copied the Spanish system, also used in their colonies, where 8 reales was called a peso. The peso became the dollar, making halves (4 bits) and quarters (2 bits) inevitable and calling for a 12-1/2 cents piece (1 bit). The influence of the French revolution brought the cent instead. In a decimal system, a 1-2-5 system of denominations is more logical, so coins of 1-2-5-10-20-50-100 cents are called for (compare euro denominations.) However, the Americans couldn't make up their minds, so they applied the Spanish system until the quarter and the French system below, with the 20 (a French quarter ;)) being an experiment to shift the border between the two systems. Even today, you will find "quarter" on the coins, but not "25 cents".

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Offline chrisild

  • Moderator
  • Honorary Member
  • *****
  • Posts: 8 771
  • NW · DE · EU
Re: Denomination systems
« Reply #1 on: March 21, 2012, 12:51:14 PM »
Even today, you will find "quarter" on the coins, but not "25 cents".

Interestingly, in Canada, where they actually use digits to indicate the face value, the quarters say "25 cents". In the US, where all the coin denominations except the unpopular $1 piece have the value in words, they use "quarter dollar" instead of "twenty-five cents".

What I find a little peculiar is that both Canada and the US use a "25" denomination when it comes to coins but a "20" when it comes to paper money. French or Spanish influence?

Christian

Offline Prosit

  • Moderator
  • Honorary Member
  • *****
  • Posts: 4 073
Re: Denomination systems
« Reply #2 on: March 21, 2012, 12:55:43 PM »
Maybe neither? Maybe a commercial concession. I think the first US 20 note was 1862 which should have been long after the French or Spanish
could have an influence other than what had already been established as historical precesedent.
Dale


What I find a little peculiar is that both Canada and the US use a "25" denomination when it comes to coins but a "20" when it comes to paper money. French or Spanish influence?

Christian

Offline villa66

  • Meritorious Member
  • ****
  • Posts: 718
Re: Denomination systems
« Reply #3 on: March 21, 2012, 02:33:43 PM »
...What I find a little peculiar is that both Canada and the US use a "25" denomination when it comes to coins but a "20" when it comes to paper money. French or Spanish influence?

It's just common sense--and the practical difference between using units and sub-units. Order your pizzas (units) by any number you want, say by the "20," which is more decimally useful than "25." But when it comes to the cutting (sub-units), it's much easier to get four (25) equal pieces than it is five (20).

 ;) v.

Offline villa66

  • Meritorious Member
  • ****
  • Posts: 718
Re: Denomination systems
« Reply #4 on: March 21, 2012, 02:45:04 PM »
...US coins copied the Spanish system, also used in their colonies, where 8 reales was called a peso. The peso became the dollar, making halves (4 bits) and quarters (2 bits) inevitable and calling for a 12-1/2 cents piece (1 bit). The influence of the French revolution brought the cent instead. In a decimal system, a 1-2-5 system of denominations is more logical, so coins of 1-2-5-10-20-50-100 cents are called for (compare euro denominations.) However, the Americans couldn't make up their minds, so they applied the Spanish system until the quarter and the French system below, with the 20 (a French quarter ;)) being an experiment to shift the border between the two systems. Even today, you will find "quarter" on the coins, but not "25 cents".
No, no, and no--again. (Really, check the dates, and lose a long-cherished notion or two. ;)) But I will agree that the euro 1-2-5-10-20-50 sub-units are "more logical," just less practical.

 :) v.

Online FosseWay

  • Moderator
  • Honorary Member
  • *****
  • Posts: 3 452
  • Göteborg, Sverige
Re: Denomination systems
« Reply #5 on: March 21, 2012, 03:40:02 PM »
I don't really get how either the 20 system or the 25 system is more or less logical or more or less practical than the other. But it's definitely less practical to have a currency that misses out a step, resulting in an overload of one particular coin. The US does this three times: no 2c, no 50c and no $2 (in normal circulation), resulting in large numbers of pennies, quarters and $1 bills being carried around. Pre-euro Germany did it by lacking either a 20pf or 25pf coin. Sweden has no 2 or 200 kronor. The UK does it by default rather than design by not distributing enough £5 notes, even though they exist and are eagerly accepted by the population, so you end up with handfuls of £1 and £2 coins in change.

Offline chrisild

  • Moderator
  • Honorary Member
  • *****
  • Posts: 8 771
  • NW · DE · EU
Re: Denomination systems
« Reply #6 on: March 21, 2012, 04:03:19 PM »
I don't really get how either the 20 system or the 25 system is more or less logical or more or less practical than the other.

I find setups easy to use where each denomination is "x" times the next (smaller) denomination, with "x" being a non-fractional figure. So that would be 1-5-10-50...  However, since you don't want too many "1" or "10" pieces, it makes sense to have gap fillers. If you add "2.5" and "25" pieces, you cannot simply use the next/smaller denomination: Something costs 30 umthings? OK, that would be a 25 umthing piece, then grab the next one which is a 10, nah, I have a 5 etc. etc.  Admittedly much of this simply boils down to what one is used to. :)

Quote
Pre-euro Germany did it by lacking either a 20pf or 25pf coin. Sweden has no 2 or 200 kronor.

As for Germany, interestingly the Federal Republic had a 0.02 coin but not a 0.20 until the euro cash came - the GDR (until 1990) did it the other way round. As for Sweden, wait until 2015 (?) when both of those missing denominations should come ...

Christian

Offline villa66

  • Meritorious Member
  • ****
  • Posts: 718
Re: Denomination systems
« Reply #7 on: March 21, 2012, 05:22:46 PM »
A question I've long wanted an answer to, and why not here? Was the German 25-pfennig of 1909 introduced because of theory, or was there some particular purpose the coin was intended for (a rise in streetcar fares...whatever)? The coin didn't take, of course, but why?

I note that there were contemporary European attempts at a 25-subunit coin--the Italian coin of 1902 didn't take either, but for reasons unrelated to the 20/25 question. The French did make a go of their own 25-subunit piece, finally persevering, but then of course let decimal theology (20!) get the better of them when they introduced the new franc in 1960.

Germany's short-lived 25-pfennig? Any one know?

 :) v.

Offline chrisild

  • Moderator
  • Honorary Member
  • *****
  • Posts: 8 771
  • NW · DE · EU
Re: Denomination systems
« Reply #8 on: March 21, 2012, 06:54:52 PM »
Germany's short-lived 25-pfennig? Any one know?

Not sure why it was introduced at all. It did not really replace the previous 20 Pfennig coin (that one was last made in 1892). According to the Jaeger catalog the 25 pf piece had been much criticized even before it was designed and issued. People did not use it, and the catalog quotes from a report dated 1911 which said that the coins were hardly popular and kept coming back to the banks. Consequence: Public banks should use them as much as possible.  :-\ Except that even that did not help - the "quarter", first issued in 1909, was last made in 1912.

The 20 Pfennig coin from the GDR was first issued in 1969, by the way, and in use until mid-1991. And in 2002 the 20 cent coin became legal tender of course.

The Netherlands heavily relied on "quarters", but at least ;) at all levels so to say: They had a 2 1/2 cent coin until the 1940s, plus (until the end of the NLG years) 25 cent coins, 2 1/2 gulden coins, 25 gulden notes and (short-lived) 250 gulden notes. Takes a while to get used to if you're used to 2, 20, etc. ...

Christian

Offline villa66

  • Meritorious Member
  • ****
  • Posts: 718
Re: Denomination systems
« Reply #9 on: March 21, 2012, 07:13:53 PM »
...The 20 Pfennig coin from the GDR was first issued in 1969, by the way, and in use until mid-1991...

Thanks for the info on the '09 25-pfennig. Any additional input on the puzzle is most welcome. Since production ended in '12, I suppose the coin was being actively withdrawn even before the outbreak of WWI and the consequent demand for its pure nickel.

About the DDR 20-pfennig, the only thing that surprises me about it was that it took so long to appear. I've read that the DDR authorities were extraordinarily proud that they had been able to keep the streetcar fare at the old-time 20pf. So the '69 issue always seemed to me like a practical coin with a particular purpose.

 :) v.


Online FosseWay

  • Moderator
  • Honorary Member
  • *****
  • Posts: 3 452
  • Göteborg, Sverige
Re: Denomination systems
« Reply #10 on: March 21, 2012, 07:40:45 PM »
The French did make a go of their own 25-subunit piece, finally persevering, but then of course let decimal theology (20!) get the better of them when they introduced the new franc in 1960.

The French introduced the 20 centime coin earlier than that -- there's a Vichy issue of that denomination from the early 1940s.

As to the DDR 20 pfennig, I seem to remember that the reason it alone among circulating coins was made of a metal other than aluminium was that it was the standard fee for a phone call from a call box, and that aluminium coins weren't heavy enough to activate the mechanism in the phone.

Offline villa66

  • Meritorious Member
  • ****
  • Posts: 718
Re: Denomination systems
« Reply #11 on: March 21, 2012, 08:04:50 PM »
Yes, I've heard that also about the 20pf needing to be a heavier piece so as to navigate various coin-boxes. And true enough about the Vichy 20-c. Of course it's really only a footnote, disappearing almost as quickly as it arrived. But speaking of the French, we could also talk about 20-c and competing 1/4-franc of the 19th century. Looks like they may have had alternating theories of utility, or simply different practical requirements.

 :) v.
« Last Edit: March 21, 2012, 09:55:56 PM by villa66 »

Online Figleaf

  • Administrator
  • Honorary Member
  • *****
  • Posts: 31 539
Re: Denomination systems
« Reply #12 on: March 21, 2012, 08:31:42 PM »
I don't really get how either the 20 system or the 25 system is more or less logical or more or less practical than the other.

My source is research from the Dutch Central Bank. They calculated how many coins would be necessary for payment of all amounts between 1 and 100 with several combinations of coins, both with and without change given. the conclusion was that the 1-2-3-5 series (the Soviet Russian system) was the most efficient, though followed very closely by 1-2-5 and 1-3-5, so cost restrictions would favour the 1-2-5 solution. The combination 1-2.5-5 (the Dutch system at the time) was found to be significantly less efficient. Indeed, leaving out a step (there was neither a half cent, nor a 2-1/2 cent at the time) makes the system less efficient. The study did not lead to action, unsurprisingly, in view of the bank's conservatism.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Offline villa66

  • Meritorious Member
  • ****
  • Posts: 718
Re: Denomination systems
« Reply #13 on: March 22, 2012, 03:53:07 AM »
...US coins copied the Spanish system, also used in their colonies, where 8 reales was called a peso. The peso became the dollar, making halves (4 bits) and quarters (2 bits) inevitable and calling for a 12-1/2 cents piece (1 bit). The influence of the French revolution brought the cent instead....

Nothing like watching history being rewritten...but why?

 ;D v.

Offline chrisild

  • Moderator
  • Honorary Member
  • *****
  • Posts: 8 771
  • NW · DE · EU
Re: Denomination systems
« Reply #14 on: March 22, 2012, 11:02:58 AM »
Don't want to play those "I think you're wrong but I won't say why" games once again, so ...

(...) Spanish dollar and other 8-reales coins. The term peso was used in Spanish to refer to this denomination (...)
http://en.wikipedia.org/wiki/Spanish_dollar

(...) The choice of 25¢ as a denomination, as opposed to 20¢ which is more common in other parts of the world, originated with the practice of dividing Spanish Milled Dollars into eight wedge shaped segments; at one time "two bits", i.e. two reales, was a common nickname for a quarter (...)
http://en.wikipedia.org/wiki/Quarter_(United_States_coin)

Christian