Token Money

TOKEN MONEY, the term employed originally to describe the counters or " tokens " issued by traders to meet the lack of small change. It has now been appropriated by economists and officials to denote the smaller currency that circulates at a nominal value higher than its cost. It is contrasted with standard " money, and is limited in its amount by state authority. Its power of discharging debts is also limited: in England, e.g., silver is legal tender only up to 403., copper to 1 2 pence. Various substances have been utilized for the manufacture of token coinage — silver at a lower degree of fineness, copper in different alloys, and nickel. The French term monnaie divisionnaire has much the same meaning; so has the German Scheidemiinze. A currency, restricted in amount, but with full legal tender power — such as the Indian rupees and the French 5-franc pieces — is midway between token and standard money. Representative money also bears some analogy to token coinage. (See MONEY and SEIGNIORAGE.) (C. F. B.)