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In contrast to the monetary system, the currency system is here defined as the totality of all the institutional arrangements which serve to shape the monetary relationships to foreign currency areas, and to determine the value of a currency. The most important elements are the exchange-rate system and the complex of currency convertibility, as well as participation in supranational regulatory systems such as the gold or silver standard, or the Bretton-Woods system. In China, right up to the recent past, the stability of the real exchange ratio between goods produce…

The balance of payments (BOP) is a value table for all economic transactions conducted within a certain period of time (usually one year) between residents and foreigners (flow figures). It is divided into various balance sheets: The current account records the import and export of goods, services, and unilateral transfers. The capital account lists changes in foreign ownership of domestic assets. The reserve account reflects changes in the central bank's stock of foreign assets (gold, foreign e…

There is only scant information on the volumes and structures of the budgets of the Chinese dynasties. It is likely that, over an extended period of time, the most important source of revenue was taxation, levied on agricultural products. It is known that revenues during the late Tang dynasty were largely characterized by state monopolies on salt, alcohol, and tea. Such state monopolies continued to play a significant role during the Song dynasty, along with trade tariffs. During the Ming and Qi…

The oldest and until fairly recently common forms of levies in China were the provision of manpower and military service. The origins of the tax system can be traced back to the 7th century BCE, when a salt tax was raised for the first time. It was raised until 1973 and has been one of the most important sources of revenue for the state for long periods of time. Soon, the first forms of an agricultural tax were introduced. On the basis of a system which made peasants pay one tenth of their harve…