“Good Money: Birmingham Button Makers, the Royal Mint, and the Beginnings of Modern Coinage, 1775-1821” by George A. Selgin offers a deep dive into the history of private coinage and its role in the British economy during the Industrial Revolution. The book reveals how Birmingham manufacturers, particularly button makers, played a pivotal role in providing a solution to the nation’s chronic coin shortage. With a blend of economic theory and historical narrative, Selgin illustrates how this “unofficial” money contributed to the growth of commerce and shaped modern monetary practices.

One of the book’s central themes is how private entrepreneurship filled a governmental void, creating a currency that was both functional and widely accepted in an era when the Royal Mint could not meet demand. This lesser-known piece of financial history has far-reaching implications for how we think about the origins of money, its regulation, and the balance between public and private control over currencies.

The book opens by describing the severe shortage of small denomination coins in Britain during the late 18th century. This shortage, caused by a combination of the Royal Mint’s inefficiency and the increasing demands of industrialization, crippled everyday commerce. Selgin explores how this shortage disproportionately affected the working class, who relied on small change for wages and day-to-day purchases. Without adequate coinage, the economy was on the verge of collapse.

In this environment, private businesses, particularly in Birmingham, stepped in to mint their own coins. As Selgin explains, these businesses were primarily button makers, who had the machinery and metalworking expertise to manufacture coins. One of the most prominent figures in this movement was Matthew Boulton, a well-known industrialist who would later revolutionize coinage by producing high-quality copper coins.

This quote encapsulates the central problem faced by the British economy and the innovative response from Birmingham’s entrepreneurs.

Selgin dedicates significant portions of “Good Money” to examining the key players in Birmingham who spearheaded the private coinage initiative. Birmingham, known for its manufacturing prowess, was home to a range of button makers who saw an opportunity in the coin shortage. These manufacturers began to mint copper coins that quickly gained acceptance as currency throughout the country.

The coins produced were not only practical but often beautifully designed, showcasing the innovation and craftsmanship of Birmingham’s industrial base. Selgin highlights how these coins gained popularity because of their reliability, standing in stark contrast to the subpar coins minted by the Royal Mint.

One of the key figures mentioned is Thomas Williams, an industrialist who saw the minting of private coins as a way to establish greater control over his workers and ensure steady payments. By doing so, he gained a reputation for his efficient and effective coinage.

This quote highlights the transition from traditional industries to the creation of a new financial system led by private entrepreneurship.

Despite the success of Birmingham’s private coinage, the Royal Mint and government officials were not thrilled with the idea of currency being produced by private hands. Selgin explores the tension between the state and private entrepreneurs, who had stepped in where the government had failed. The Royal Mint’s inability to meet the growing demand for coins, coupled with the superior quality of private issues, put immense pressure on the government to reform.

The book describes several government efforts to regulate or suppress private coinage, including threats of legal action and new legislation. However, as Selgin shows, these efforts were largely ineffective. The public had come to rely on the private coins, and their widespread use made it difficult for the government to simply outlaw them.

In this context, Matthew Boulton emerges as a central figure, negotiating with the government to supply coins on an official basis. Boulton’s Soho Mint became the first private enterprise contracted by the Royal Mint to produce coins, leading to a transformation in how currency was produced in Britain.

A major turning point in the book is Matthew Boulton’s involvement with the Royal Mint. His Soho Mint, already known for producing high-quality tokens, was approached by the government to help solve the coin shortage. Boulton’s solution was to use steam-powered machinery to mass-produce high-quality, counterfeit-proof coins.

Selgin provides detailed accounts of how Boulton’s innovations revolutionized coinage not just in Britain but around the world. His coins, minted with precision and uniformity, set a new standard for currency production. The Soho Mint’s coins became the backbone of the British monetary system, eventually leading to a broader overhaul of the Royal Mint itself.

One key anecdote in this section involves Boulton’s insistence on producing coins that were difficult to counterfeit, a problem that had plagued earlier efforts by both the Royal Mint and private manufacturers. His innovative designs included detailed engravings and complex patterns that made counterfeiting nearly impossible.

This quote underscores how Boulton’s innovations went beyond simple monetary solutions and reflected the broader industrial spirit of the era.

In the final chapters of “Good Money,” Selgin examines the long-term impact of Birmingham’s private coinage on modern monetary systems. The success of private entrepreneurs in addressing the coin shortage led to a reevaluation of the government’s role in currency production. The reforms that followed—including the modernization of the Royal Mint—were directly influenced by the innovations of private manufacturers like Boulton.

Selgin also touches on the broader implications of this historical episode for modern monetary theory. He argues that the success of private coinage challenges the notion that only governments can issue viable currency. The Birmingham button makers demonstrated that under the right conditions, private enterprise could step in to provide a crucial public good.

This historical narrative has contemporary relevance, as debates about private currencies—such as cryptocurrencies—continue to shape discussions about the future of money. Selgin draws clear parallels between the private coinage of the 18th century and modern-day efforts to create alternative forms of currency.

“Good Money: Birmingham Button Makers, the Royal Mint, and the Beginnings of Modern Coinage, 1775-1821” by George A. Selgin offers a fascinating account of how private entrepreneurship filled a governmental void in Britain’s monetary system. Through detailed research and engaging narrative, Selgin highlights the ingenuity of Birmingham’s button makers and their lasting impact on modern coinage.

Selgin’s work challenges conventional views on money, showing that private individuals can effectively create and manage currency. The book is not only a valuable resource for historians and economists but also for anyone interested in the ongoing debates about the future of money and the role of the state in economic systems.

By blending economic theory with rich historical anecdotes, Selgin delivers a thought-provoking exploration of one of the most critical yet overlooked periods in the history of modern coinage.

This final quote encapsulates the essence of the book and leaves readers reflecting on the broader implications of the historical events Selgin so expertly details.