The Effects of Inflation and Deflation in Revolutionary France

Revolutionary France from 1789 onwards experienced large political and economic upheavals. 1789 marked the beginning of the Revolution over an already crumbling monarchy, in London lay stored away the greater part of the world's stock of gold and silver, and, as after the Seven Years' War nearly every country in Europe had to borrow from London, the basis of European economic structure was changed from wealth to debt. Among these nations France became the more heavily involved, as she was compelled to borrow large sums in order to pay for British colonial imports and her own share of the cost of the war of the American Rebellion . Soon she was reduced to borrow in order to pay interest on former loans, this worsening of the economic situation partly led to the collapse of the Ancien regime. After 1789, the French experienced acute inflation and in the first part of this essay I will be detailing what inflation is and will explain how it came about and its effect in Revolutionary France in the period 1789-1796. …