The role of reputational incentives in an international currency union: Greek monetary institutions in the classical and Hellenistic periods

Abstract In the Hellenistic era, there was widespread convergence to the Attic standard and a similar narrowing of coin types in terms of aesthetics. The competition between issuers resulted in an equilibrium in which improvements to the consistency and quality of money were sought after. This institutional foundation resulted in the creation of an incentive structure that fortified adherence to international monetary standards and discouraged entropy due to debasement and the pursuit of short-sighted fiscal gains. This paper explores the role of reputational incentives faced by issuers when determining coinage standards and aesthetic types, as well as the benefits that the attainment of reputational value conferred to both the issuers and users of coinage. I argue that the economic openness and competitive nature of coin issuance in the period created a framework in which the imputation of fiduciary value to coinage stemmed from the generation of reputational quality.