I would like to study China’s 1935 Currency Reform to investigate the central-provincial relations. After graduating from Stony Brook University, I worked at a business firm where I found that the current European debt crisis shares some similarities with Chinese economy of the 1930s. One of the most crucial issues of the euro crisis is the legitimacy of the European Central Bank. Some members, like Greece, argue that the monetary policy of euro only considers Germany’s interests, but neglects the interests of other member states. The early Republic of China experienced similar problems. At the beginning of the Nanjing decade, China was military unified, but was economical fragmented. Some KMT officers such as T.V Soong believed that in order
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First, I want to examine the debate on regulating local currencies in late imperial China. Studying this intellectual debate can explain why the Qing government did not regulate local currencies. Second, I will review the decision making process of currency reform. The way the KMT thought about the local interests was critical to the central-provincial relations. Third, I want to know how the currency reform impacted the provinces’ understanding of the nation and nationalism. The local currencies were not backed by any central institutions, but by local governments or local banks. When the new national currency was introduced to the market, the reform not only affected the economy, but the way the nation or nationalism was understood at the provincial level. Examining these changes can demonstrate how Chinese nationalism was understood in the 1930s. Finally, I am interested in the effects of currency reform on local fiscal policies. During the warlord period, local governments already knew how to use monetary policy such as increasing money supply to lower budget deficits. Once central government controlled monetary policy, local governments could theoretically not use this tool anymore. In the 1940s, the central government increased the money supply to fund the Sino-Japanese War and the Chinese Civil War. I am interested in how fiscal policy of local governments responded to hyperinflation caused by the KMT’s monetary
First, I want to examine the debate on regulating local currencies in late imperial China. Studying this intellectual debate can explain why the Qing government did not regulate local currencies. Second, I will review the decision making process of currency reform. The way the KMT thought about the local interests was critical to the central-provincial relations. Third, I want to know how the currency reform impacted the provinces’ understanding of the nation and nationalism. The local currencies were not backed by any central institutions, but by local governments or local banks. When the new national currency was introduced to the market, the reform not only affected the economy, but the way the nation or nationalism was understood at the provincial level. Examining these changes can demonstrate how Chinese nationalism was understood in the 1930s. Finally, I am interested in the effects of currency reform on local fiscal policies. During the warlord period, local governments already knew how to use monetary policy such as increasing money supply to lower budget deficits. Once central government controlled monetary policy, local governments could theoretically not use this tool anymore. In the 1940s, the central government increased the money supply to fund the Sino-Japanese War and the Chinese Civil War. I am interested in how fiscal policy of local governments responded to hyperinflation caused by the KMT’s monetary