• Corpus ID: 152684659

Nominal Contracts in a Bimetallic Standard

@article{Garber1986NominalCI,
  title={Nominal Contracts in a Bimetallic Standard},
  author={Peter M. Garber},
  journal={The American Economic Review},
  year={1986},
  volume={76},
  pages={1012-1030}
}
As its central feature, a bimetallic standard grants nominal debtors an option to deliver either of two metals. With results from the option pricing literature,construction of a formula to evaluate the bimetallic option in debt instruments is straightforward. With this formula, one can compute the option value in a wide range of nineteenth-century U.S. Treasury securities. Posession of the option values permits an adjustment of the yields on U.S. securities to make them comparable to yields on… 

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