The dual-currency economy of the Danelaw

Cowrie shell money issued in late 18th century West Africa.

The co-existence of two or more distinct currencies is a common phenomenon throughout history. In ancient Greece, silver bullion circulated alongside coin. In medieval Scandinavia, weighed silver, cattle and grain were common forms of payment, even within the same transaction. French francs and local cowry shell money were concurrent currencies in nineteenth-century West Africa – one of many examples where ‘state’ or ‘colonial’ moneys were introduced to societies with pre-existing, ‘local’ or ‘indigenous’ currencies. 

As I argue in a new Antiquity paper, a dual-currency economy also operated in the Danelaw region of eastern England, where the Vikings settled, following a period of raiding activity, in the late ninth century. Here, a wealth of new archaeological evidence indicates that the Vikings introduced a bullion currency based on weighed and tested precious metal. Over the last few years, I’ve documented evidence for hundreds of single finds of Scandinavian silver ingots, chopped up bits of ring and foreign coin, as well as standardised weights, all presumably lost by accident in areas where they were in frequent use. Yet it’s clear that this bullion economy coincided with a second silver currency, namely coinage, some of it minted by the Vikings themselves. Critically, bullion and coin circulated at the same time and in the same areas for 60 years or so (roughly 870-930 AD): a good two generations by the standards of the day.

In the Danelaw area of northern and eastern England, bullion and coin co-existed in a dual-currency economy

How did this work in practice? Was the use of coin and bullion split down ethnic or cultural lines (those using bullion and coin having little to do with each other)? Or did Scandinavian settlers use coin in addition to bullion, perhaps using different media for different monetary purposes?  One interesting pattern is that locally minted coins -the official Danelaw currency- are rarely treated as bullion in Viking-settled areas.  They are rarely tested or cut, although they could of course have been weighed – a treatment that would leave no physical trace. This suggests to me that the Viking settlers used coinage, alongside bullion, perhaps preserving coin for use in towns where exchange was closely monitored and bullion finds rare. The purse of a Scandinavian trader likely contained bullion as well as local coin, the duality of payment media ensuring that she was prepared for all exchange eventualities.

Why preserve bullion, when coinage was widely available? Underlying this question is the assumption that coinage is somehow ‘better’ than other forms of money: more sophisticated than crude weighed silver currency because it (unlike bullion) requires authentication and regulation by a state, and more convenient because it reduces the number of ‘transaction costs’.

A silver ingot from Yorkshire weighing nearly 20 grams.  Ingots such as this were arguably more suitable than coinage for use in large-value transactions. Copyright PAS.

But there were many advantages in using bullion.  It was better suited than coin for large transactions (no need to count out 100 pennies when a single ingot would do the job). It was also easier to exchange with international trade partners, since raw silver, unlike coinage, was acceptable across national frontiers. Silver bullion was easy to test for quality (via nicking), whereas contemporary coins could be a bit dodgy, with frequently low silver contents, running the risk that they might not be accepted by your trading partner. Whereas coins were periodically called in for reminting (and thus, one’s coin stock was effectively taxed), silver bullion was not regulated, and in this way retained its value over time. It is also possible that the performance of a bullion transaction was tied to Scandinavian identity in England. Maintaining a bullion economy may have been a means by which Viking settlers marked themselves out as different from the local Anglo-Saxons.