Assignat
Encyclopedia
Assignat was the type of a monetary instrument used during the time of the French Revolution
, and the French Revolutionary Wars
.
Assignats were paper money issued by the National Assembly
in France during the French Revolution
. The assignats were issued after the confiscation of church properties in 1790 because the government was bankrupt. The government thought that the financial problems could be solved by printing certificates representing the value of church properties. These church lands became known as biens nationaux
(“national goods”). Assignats were used to successfully retire a significant portion of the national debt
as they were accepted as legitimate payment by domestic and international creditors. Certain precautions not taken concerning their excessive reissue and comingling with general currency in circulation caused hyperinflation.
Originally meant as bonds
, they evolved into a currency used as legal tender
. As there was no control over the amount to be printed, the value of the assignats exceeded that of the confiscated properties. This caused massive hyperinflation
. In the beginning of 1792, they had lost most of their nominal value. In 1796, the Directoire
issued Mandats
, a currency in the form of land warrants to replace the assignats, although these too quickly failed.
This hyperinflation was stirred up by repeated food shortages. Instead of solving the financial problems, the assignats became a catalyst for (food) riots. Instability continued after the abolition of the monarchy, exacerbated by the wars France faced. This situation impeded the implementation of good financial policies that would reduce debt
s. Bills such as the Maximum Price Act of 1793 aimed to regulate inflation.
When the Directoire
came into power in 1795 the Maximum Price Act was lifted. Hyperinflation reemerged and in the next four years Paris was the stage of yet more riots.
The inflation was finally solved by Napoleon
in 1803 by introducing the franc
as the new currency. By this time, the assignats were basically worthless.
established the Roman Republic
, which also issued assignats (Italian: assegnati). They were issued by the law of 23 Fructidor
VI (14 Sept 1798). The currency used was paolo or giulio, the older currency of the Papal States
. Roman Republic also issued coins denominated in baiocco and scudo.
) was used in Russia from 1769 until 1 January 1849. This had no connection to the French Revolution.
French Revolution
The French Revolution , sometimes distinguished as the 'Great French Revolution' , was a period of radical social and political upheaval in France and Europe. The absolute monarchy that had ruled France for centuries collapsed in three years...
, and the French Revolutionary Wars
French Revolutionary Wars
The French Revolutionary Wars were a series of major conflicts, from 1792 until 1802, fought between the French Revolutionary government and several European states...
.
France
National Assembly
National Assembly is either a legislature, or the lower house of a bicameral legislature in some countries. The best known National Assembly, and the first legislature to be known by this title, was that established during the French Revolution in 1789, known as the Assemblée nationale...
in France during the French Revolution
French Revolution
The French Revolution , sometimes distinguished as the 'Great French Revolution' , was a period of radical social and political upheaval in France and Europe. The absolute monarchy that had ruled France for centuries collapsed in three years...
. The assignats were issued after the confiscation of church properties in 1790 because the government was bankrupt. The government thought that the financial problems could be solved by printing certificates representing the value of church properties. These church lands became known as biens nationaux
Biens nationaux
Biens nationaux, or "national property", was a concept in French history. During the French Revolution, the possessions of the Roman Catholic Church were declared national property by the decree of November 2, 1789. These were sold to resolve the financial crisis that caused the Revolution...
(“national goods”). Assignats were used to successfully retire a significant portion of the national debt
Government debt
Government debt is money owed by a central government. In the US, "government debt" may also refer to the debt of a municipal or local government...
as they were accepted as legitimate payment by domestic and international creditors. Certain precautions not taken concerning their excessive reissue and comingling with general currency in circulation caused hyperinflation.
Originally meant as bonds
Bond (finance)
In finance, a bond is a debt security, in which the authorized issuer owes the holders a debt and, depending on the terms of the bond, is obliged to pay interest to use and/or to repay the principal at a later date, termed maturity...
, they evolved into a currency used as legal tender
Legal tender
Legal tender is a medium of payment allowed by law or recognized by a legal system to be valid for meeting a financial obligation. Paper currency is a common form of legal tender in many countries....
. As there was no control over the amount to be printed, the value of the assignats exceeded that of the confiscated properties. This caused massive hyperinflation
Hyperinflation
In economics, hyperinflation is inflation that is very high or out of control. While the real values of the specific economic items generally stay the same in terms of relatively stable foreign currencies, in hyperinflationary conditions the general price level within a specific economy increases...
. In the beginning of 1792, they had lost most of their nominal value. In 1796, the Directoire
French Directory
The Directory was a body of five Directors that held executive power in France following the Convention and preceding the Consulate...
issued Mandats
Mandats territoriaux
Mandats territoriaux were a paper bank notes issued as currency by the French Directory in 1796 to replace the assignats which had become virtually worthless. They were land-warrants supposedly redeemable in the lands confiscated from royalty, the clergy and the church after the outbreak of the...
, a currency in the form of land warrants to replace the assignats, although these too quickly failed.
This hyperinflation was stirred up by repeated food shortages. Instead of solving the financial problems, the assignats became a catalyst for (food) riots. Instability continued after the abolition of the monarchy, exacerbated by the wars France faced. This situation impeded the implementation of good financial policies that would reduce debt
Debt
A debt is an obligation owed by one party to a second party, the creditor; usually this refers to assets granted by the creditor to the debtor, but the term can also be used metaphorically to cover moral obligations and other interactions not based on economic value.A debt is created when a...
s. Bills such as the Maximum Price Act of 1793 aimed to regulate inflation.
When the Directoire
French Directory
The Directory was a body of five Directors that held executive power in France following the Convention and preceding the Consulate...
came into power in 1795 the Maximum Price Act was lifted. Hyperinflation reemerged and in the next four years Paris was the stage of yet more riots.
The inflation was finally solved by Napoleon
Napoleon I of France
Napoleon Bonaparte was a French military and political leader during the latter stages of the French Revolution.As Napoleon I, he was Emperor of the French from 1804 to 1815...
in 1803 by introducing the franc
Franc
The franc is the name of several currency units, most notably the Swiss franc, still a major world currency today due to the prominence of Swiss financial institutions and the former currency of France, the French franc until the Euro was adopted in 1999...
as the new currency. By this time, the assignats were basically worthless.
Italy
Between 1798 and 1799, the revolutionary French forcesFrench Revolutionary Wars
The French Revolutionary Wars were a series of major conflicts, from 1792 until 1802, fought between the French Revolutionary government and several European states...
established the Roman Republic
Roman Republic (18th century)
The Roman Republic was proclaimed on February 15, 1798 after Louis Alexandre Berthier, a general of Napoleon, had invaded the city of Rome on February 10....
, which also issued assignats (Italian: assegnati). They were issued by the law of 23 Fructidor
Fructidor
Fructidor is the twelfth month in the French Republican Calendar. The month was named after the Latin word fructus, which means "fruit".Fructidor is the third month of the summer quarter . By the Gregorian calendar, Fructidor starts on either August 18 or August 19 and ends exactly thirty days...
VI (14 Sept 1798). The currency used was paolo or giulio, the older currency of the Papal States
Papal States scudo
The Roman scudo was the currency of the Papal States until 1866. It was subdivided into 100 baiocchi , each of 5 quattrini...
. Roman Republic also issued coins denominated in baiocco and scudo.
Russia
The term assignat is similar to the Russian word assignatsia which means "banknote". Assignatsionny rubl (assignation rubleAssignation ruble
Assignation ruble was the first paper currency of Russia. It was used from 1769 until 1849. Assignation ruble had a parallel circulation with the silver ruble; there was an ongoing market exchange rate for these two currencies...
) was used in Russia from 1769 until 1 January 1849. This had no connection to the French Revolution.