European Financial Crisis of 1763

Abstract

Introduction. The financial factor had its full effect during the next major pan-European conflict – the Seven Years’ War (1756–1763). The Seven Years’ War can be considered as the “zero” World War of the 18th century. Its fighting took place in all parts of the world and oceans known then. All the major Christian powers of that time were drawn into it. In terms of the level of militarization, this war surpassed all previous coalition wars. The financial crisis caused by the Seven Years’ War was also very different from the previous ones and had a pan-European effect. The purpose of the article is to study the causes of the financial crisis of 1763. Materials and Methods. Comparative-historical, chronological and genealogical research methods were used, the principles of objectivity and historicism were observed. Results. The crisis was led by the confidence of some banks and financial firms in a win-win business related to the supply of military operations. Discussion and Conclusion. After Frederick II began defacing coins, according to the Copernicus – Gresham law, degraded money is forced out of circulation by full-weight ones, so the German princes, who were neighbors of Prussia, were forced to voluntarily lower the silver content in their coins. There was nothing left but to start the debasing process. This leads to the financial crisis of 1763.